In May, some of the individual defendants in the AOL/Time Warner securities class action were dismissed from the case. According to a report in yesterday’s Washington Post, however, Judge Kram of the S.D.N.Y. has reinstated the case against most of these defendants (including former AOL Chairman Steve Case) based on the plaintiffs’ second amended complaint.
Quote of note: “The opinion said: ‘According to the second amended complaint, on October 17, 2000, Case said, ‘I do not think people generally are concerned about Internet advertising. Our results show that there’s no reason to be concerned when it comes to AOL.’ In light of Case’s alleged knowledge as early as November 1999 that the advertising revenue was facing a ‘stark reversal of fortune,’ the above statement may form the basis of a [securities fraud] claim against Case.'”