Finkelstein, Thompson & Loughran Filed Securities Fraud Class Action Against DaimlerChrysler AG, Daimler-Benz, and Jurgen Schrempp In Michigan Federal Court
6 December 2000
Finkelstein, Thompson & Loughran Filed Securities Fraud Class Action Against DaimlerChrysler AG, Daimler-Benz, and Jurgen Schrempp In Michigan Federal Court
WASHINGTON, Dec. 6 On November 30, 2000 Finkelstein,
Thompson & Loughran filed a securities class action lawsuit in the United
States District Court for the Eastern District of Michigan on behalf of
investors who
* purchased DaimlerChrysler AG stock between November 14, 1998 and
October 29, 2000 (the "Section 10(b) Class")(10(b) Class Period);
* owned Chrysler Corporation stock as of July 20, 1998, the record date
for the merger vote, and who suffered damages as a result (the "Proxy
Fraud Class");
* received DaimlerChrysler AG stock in exchange for Chrysler Corporation
stock as a result of the merger, and were damaged thereby (the "1933
Act Class").
The complaint alleges that DaimlerChrysler AG, Daimler-Benz and its top
officer, Jurgen Schrempp misrepresented the true nature of the business
combination by repeatedly claiming it to be a "merger of equals." Defendants
falsely told Chrysler and its shareholders that DaimlerChrysler would operate
as two equal companies with Chrysler's management continuing to run U.S.
operations and having parity in all respects with Daimler-Benz's management,
including equal representation on the management team of the combined
companies. Defendants' promises and assurances were the cornerstone of
Chrysler's board and shareholder decisions to vote in favor of the business
combination.
However, as admitted by Schrempp in a Financial Times interview, their
true intention always was to acquire Chrysler Corporation and relegate it to
the status of a "division" and to replace Chrysler's management with
executives from Daimler-Benz's headquarters in Stuttgart, Germany. Once the
merger was approved and implemented, defendants systematically began
"downsizing" and eliminating positions -- Chrysler positions in
DaimlerChrysler. The elimination of a Chrysler presence in DaimlerChrysler
was culminated on November 17, 2000 when Schrempp fired James P. Holden, the
chief executive officer of Chrysler's North American operation. Schrempp
replaced this last Chrysler executive with Dieter Zetsche and Wolfgang
Bernhard, two of his former Daimler-Benz associates.
Since the filing of this and other actions, Schrempp and DaimlerChrysler
have backpedaled from the statements in the Financial Times. Moreover, they
attempted to draw fire and attention to former Chrysler executives by blaming
those executives for Chrysler's financial woes and by accusing former Chrysler
executives of misleading Daimler-Benz in connection with the merger.
The defendants denied Chrysler's shareholders their right to an informed
vote on the merger and denied them their rightful acquisition premium.
Plaintiff asks the Court to order that the defendants relinquish control of
DaimlerChrysler's management, to award damages including the acquisition
premium and rescissory damages under Sections 11 and 12(a)(2) of the
Securities Act of 1933; to award compensatory and punitive damages, and to
unwind the transaction in order to allow Chrysler once again to exist as an
independent corporation owned by Chrysler's shareholders and to return all
value, including distributions, which DaimlerChrysler caused Chrysler to
transfer since the merger, under Section 14(a) of the Securities Exchange Act
of 1934.
Plaintiff seeks to recover these awards on behalf of all investors
described in the classes above who suffered damages as a result of defendants'
wrongful conduct. Plaintiff is represented by the law firm of Finkelstein,
Thompson & Loughran, of Washington, DC, among others. Finkelstein, Thompson &
Loughran has over thirty years of securities litigation experience, has broad
experience in representing defrauded investors in shareholder class actions,
and has been appointed to lead positions in many such actions in federal and
state courts throughout the United States.
If you are a member of the Classes described above, and if you meet
certain other legal requirements, you may, not later than January 29, 2001,
move the Court to serve as a lead plaintiff. If you wish to discuss this
action or have any questions concerning this notice or your rights or
interests, please contact Tracy D. Rezvani with Finkelstein, Thompson &
Loughran, toll-free at 888-333-4409, or at 202-337-8000, or by e-mail at
tdr@ftllaw.com. If you wish to learn more about Finkelstein, Thompson &
Loughran, please visit their Web page at http://www.ftllaw.com.