| Company: | ITT Educational Services, Inc. |
| Ticker Symbol: | NYSE: ESI |
| Class Period: | April 17, 2003 to February 25, 2004 |
| Court: | Southern District, IN |
| Date Filed: | Mar-04-04 |
| Lead Plaintiff Deadline: | Apr-26-04 |
| Allegations: |
A class action suit has been filed in the United States District Court for the Southern District of Indiana on behalf of purchasers of ITT Educational Services, Inc. (NYSE: ESI - News; "ITT/ESI" or the "Company") publicly traded securities during the period between April 17, 2003 and February 25, 2004, inclusive (the "Class Period").
The complaint charges ITT/ESI, Rene R. Champagne and Kevin M. Modany with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that throughout the Class Period, ITT/ESI issued multiple press releases highlighting the Company's increasing financial performance and the continued robust demand for its educational programs. The Company also disclosed in its filings with the Securities & Exchange Commission ("SEC") during the Class Period that a substantial portion of the tuition paid by its students comes from federal education aid programs, which the Company's schools are authorized to offer. These statements, however, were materially false and misleading because they failed to disclose: (1) that the statistics that the Company provided to the government in order to continue its eligibility in offering Title IV programs were inaccurate; (2) that defendants' actions would result in reputational harm to the Company's schools and possible disqualification of the Company's students from future participation in federal education aid programs; and (3) that as a result, defendants' positive statements concerning the Company's future prospects were lacking in a reasonable basis when made.
As defendants continued to issue positive statements about the Company and its future prospects, shares of the Company's stock steadily increased. Throughout this period, ITT/ESI insiders took advantage of the artificial inflation in the Company's stock and sold approximately $8,455,385 of their personally held shares to the unsuspecting public at artificially inflated prices.
On February 25, 2004, ITT/ESI shocked the market when it announced that federal agents had raided the Company's corporate headquarters in Indianapolis. The agents carried search warrants that were issued from a grand jury probe by the Southern District of Texas. According to the Company, the investigation involved grand jury subpoenas of records concerning student placement, retention, graduation, attendance, recruitment, grades, graduates' salaries and transfers of students' credits to other colleges.
Trading was halted throughout the morning. When trading resumed, shares of the Company's stock fell to $38.50 per share, a decline of $18.90 per share, or approximately 33%, on extremely high trading volume.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
The complaint charges ITT/ESI, Rene R. Champagne and Kevin M. Modany with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that throughout the Class Period, ITT/ESI issued multiple press releases highlighting the Company's increasing financial performance and the continued robust demand for its educational programs. The Company also disclosed in its filings with the Securities & Exchange Commission ("SEC") during the Class Period that a substantial portion of the tuition paid by its students comes from federal education aid programs, which the Company's schools are authorized to offer. These statements, however, were materially false and misleading because they failed to disclose: (1) that the statistics that the Company provided to the government in order to continue its eligibility in offering Title IV programs were inaccurate; (2) that defendants' actions would result in reputational harm to the Company's schools and possible disqualification of the Company's students from future participation in federal education aid programs; and (3) that as a result, defendants' positive statements concerning the Company's future prospects were lacking in a reasonable basis when made.
As defendants continued to issue positive statements about the Company and its future prospects, shares of the Company's stock steadily increased. Throughout this period, ITT/ESI insiders took advantage of the artificial inflation in the Company's stock and sold approximately $8,455,385 of their personally held shares to the unsuspecting public at artificially inflated prices.
On February 25, 2004, ITT/ESI shocked the market when it announced that federal agents had raided the Company's corporate headquarters in Indianapolis. The agents carried search warrants that were issued from a grand jury probe by the Southern District of Texas. According to the Company, the investigation involved grand jury subpoenas of records concerning student placement, retention, graduation, attendance, recruitment, grades, graduates' salaries and transfers of students' credits to other colleges.
Trading was halted throughout the morning. When trading resumed, shares of the Company's stock fell to $38.50 per share, a decline of $18.90 per share, or approximately 33%, on extremely high trading volume.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
If you feel you qualify for damages or remedies that might be awarded in this class action please fill in our form on the right to submit your complaint.
If your injustice does not match the complaint described above, please use this form to register your complaint. Thank you.
