| Company: | Sea Containers Ltd. |
| Ticker Symbol: | NYSE: SCR-A |
| Class Period: | March 24, 2003 to June 13, 2006 |
| Date Filed: | Aug-08-06 |
| Lead Plaintiff Deadline: | Oct-09-06 |
| Court: | Southern District, NY |
| Allegations: |
A class action suit has been filed on behalf of all purchasers or acquirers of the following series of notes of Sea Containers Ltd. (NYSE:SCR-A) ("SCL" or the "Company") between March 24, 2003 and June 13, 2006, both dates inclusive (the "Class Period").
The action, entitled Tartikoff v. Sea Containers Ltd, et al., Index No. 06 CV 5655 (SWK), is pending in the United States District Court for the Southern District of New York and names as defendants the Company, James Sherwood (former CEO, President and Chair), Ian C. Durant (CFO), and Daniel J. O'Sullivan (former CFO).
The Complaint alleges that throughout the Class Period SCL disseminated press releases and SEC filings that were materially false and misleading because, among other things: (1) defendants failed to record, in a timely manner, half a billion dollars' worth of impairments to the value of certain assets in SCL's ferry and container business segments; (2) SCL overstated its earnings and exaggerated its profit from the sale of its equity interest in Orient-Express Hotels Ltd. ("OEH"), an unconsolidated company of which SCL owned 42% as of April 2004, which coincided with the registration and issuance of the Company's 10.5% Notes; (3) the Company lacked adequate internal controls and was therefore unable to ascertain its true financial condition; and (4) as a result, the value of SCL's net income and financial results were materially overstated at all relevant times.
On March 24, 2006, prior to the market's opening, SCL disclosed it would discontinue its ferry business, record a $500 million impairment of certain assets and restate its 2005 interim financial results. With respect to the $500 million impairment charge, of which $415 million related to assets in the ferry operations division, the Company stated that it would recognize the charge during the fourth quarter of 2005. As of September 30, 2005, the Company reported the value of those assets as more than $1 billion. The Company further disclosed that, as a result of the substantial write-down, it violated debt covenants with certain lenders and would restate its 2005 financial statements. The Company attributed the overstatement to the $10.3 million-gain from the March 2005 sale of a portion of its equity investment in OEH, chalking it up to an accounting error in its foreign currency exchange reserves.
On June 13, 2006, SCL issued a press release announcing that "it may be in default on its bonds." The press release emphasized that the Company "was unsure if it would repay a bond due in October follow(ing) a default by French auto logistics company GAL -- the first European default since February 2005." The rating agencies contemporaneously predicted that "default rates (would) rise from very low levels." On June 13th, upon hearing of this news, SCL's stock price dropped $0.60 cents per share. The price has continued along a downward slope through the date of the filing of this action and, as a result of the foregoing, the Notes have lost millions of dollars in value.
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 action, entitled Tartikoff v. Sea Containers Ltd, et al., Index No. 06 CV 5655 (SWK), is pending in the United States District Court for the Southern District of New York and names as defendants the Company, James Sherwood (former CEO, President and Chair), Ian C. Durant (CFO), and Daniel J. O'Sullivan (former CFO).
The Complaint alleges that throughout the Class Period SCL disseminated press releases and SEC filings that were materially false and misleading because, among other things: (1) defendants failed to record, in a timely manner, half a billion dollars' worth of impairments to the value of certain assets in SCL's ferry and container business segments; (2) SCL overstated its earnings and exaggerated its profit from the sale of its equity interest in Orient-Express Hotels Ltd. ("OEH"), an unconsolidated company of which SCL owned 42% as of April 2004, which coincided with the registration and issuance of the Company's 10.5% Notes; (3) the Company lacked adequate internal controls and was therefore unable to ascertain its true financial condition; and (4) as a result, the value of SCL's net income and financial results were materially overstated at all relevant times.
On March 24, 2006, prior to the market's opening, SCL disclosed it would discontinue its ferry business, record a $500 million impairment of certain assets and restate its 2005 interim financial results. With respect to the $500 million impairment charge, of which $415 million related to assets in the ferry operations division, the Company stated that it would recognize the charge during the fourth quarter of 2005. As of September 30, 2005, the Company reported the value of those assets as more than $1 billion. The Company further disclosed that, as a result of the substantial write-down, it violated debt covenants with certain lenders and would restate its 2005 financial statements. The Company attributed the overstatement to the $10.3 million-gain from the March 2005 sale of a portion of its equity investment in OEH, chalking it up to an accounting error in its foreign currency exchange reserves.
On June 13, 2006, SCL issued a press release announcing that "it may be in default on its bonds." The press release emphasized that the Company "was unsure if it would repay a bond due in October follow(ing) a default by French auto logistics company GAL -- the first European default since February 2005." The rating agencies contemporaneously predicted that "default rates (would) rise from very low levels." On June 13th, upon hearing of this news, SCL's stock price dropped $0.60 cents per share. The price has continued along a downward slope through the date of the filing of this action and, as a result of the foregoing, the Notes have lost millions of dollars in value.
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.
