IN THE UNITED STAT ISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
I
DIANE PILGRIM, individually and on
behalf of all others similarly situated, Civil Action No.
Plaintiff,
CLASS ACTION COMPLAINT
V.
MERRILL LYNCH & CO., INC., and
HENRY BLODGET -- JURY TRIAL DEMANDED
Defendants.
Plaintiff, through her attorneys, alleges the following upon information
except as to the allegations which pertain to the Plaintiff and her counsel, which
upon personal knowledge. Plaintiffs information and belief is based,
investigation made by and through his attorneys.
INTRODUCTION
1. This is a federal securities class action brought against the Defendant
Lynch & Co. ("Merrill Lynch"), and its former primary internet company analyst, Henry
Blodget ("Blodget"), on behalf of a class (the "Class") consisting of all persons or
who purchased, or otherwise acquired, the common stock of 24/7 Real Media, Inc. ("24/7"
or "the Company") from May 12, 1999 through November 9, 2000,
Period"). Plaintiff seeks to recover damages caused to the Class by Defendants'
of Section IO(b) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule
lob-5 promulgated thereunder, and Section 20(a) of the Exchange Act.
SNIPPETS:
except as to the allegations which pertain to the Plaintiff and her counsel,
Lynch & Co. ("Merrill Lynch"), and its former primary internet company analyst, Henry
Blodget, on behalf of a class consisting of all persons or entities
Plaintiff seeks to recover damages caused to the Class by Defendants' violations
of Section IOof the Securities Exchange Act of 1934 and Rule
Furthermore, when issuing their 2417 reports, the Defendants failed to disclose significant,
material conflicts of interest which they had, in light of their use of Blodget's reputation
On April 8,2002, the Office of the Attorney General of the State of New York
"Dinallo Affidavit" or "Dinallo Aff.").
National Market System, a national securities exchange.
Plaintiff Diane Pilgrim purchased shares of 2417 common stock,
Lynch and was Merrill Lynch's primary analyst for Internet companies.
Post in an article entitled "Analyst With a Knack for Shaking up Net Stocks; Henry Blodget
Two months earlier Blodget had put a 12-month price target of $150 on it.
"Our job is not to be stock pickers, but to be correct on trends, and help investors pick
In its June 29, 1999 issue, the Wall Street Journal named Henry Blodget as
One veteran portfolio manager puts its more bluntly: "These guys are selling their souls for
and television media was reported in the June 5,200O issue of The industry Standard, The
It slid to $6.125 in a month, when Mr. Blodget initiated coverage with a prediction that
July 13,200O analyst report statedthat the Defendants expected very strong results for the
of that report, Internet Capital Group closed at $29.4375 per share, up $2.6875 from the
companies and Merrill Lynch's investment banking business is seen by the choices the
Defendants' awareness of the conflicts of interest which that created and the fact that they
(Dinallo Affidavit at 20 - 21, underline emphasis in original, bold emphasis added).
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