UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
________________________________________________
JENNIFER J. FADEM, X
on behalf of herself and all others : No.
similarly situated, :
: CLASS ACTION
Plaintiff, : COMPLAINT
:
AOL TIME WARNER, INC., :
STEPHEN M. CASE, WAYNE :
H. PACE, J. MICHAEL KELLY, :
and ERNST & YOUNG, LLP, : JURY TRIAL DEMANDED
:
Defendants. :
________________________________________________X
Plaintiff, by her undersigned attorneys, individually and on behalf of the Class described
below, upon information and belief, based upon, inter alia, the investigation of counsel, which
includes, among other things, a review of public announcements made by defendants, Securities and
Exchange Commission ("SEC") filings made by defendants, press releases, reports of securities
analysts, and media reports, except as to the paragraph applicable to the named plaintiff which is
alleged upon personal knowledge, brings this Complaint (the "Complaint") against defendants
named herein, and alleges as follows:
SUMMARY OF ALLEGATIONS
1. This is a securities class action on behalf of all persons who purchased, converted,
exchanged or otherwise acquired the common stock of America Online, Inc. ("AOL") between July
SNIPPETS:
SOUTHERN DISTRICT OF NEW YORK
Plaintiff, by her undersigned attorneys, individually and on behalf of the Class described
Exchange Commission filings made by defendants, press releases, reports of securities
analysts, and media reports, except as to the paragraph applicable to the named plaintiff
exchanged or otherwise acquired the common stock of America Online,
acquired the common stock of AOL Time Warner, Inc.
C Failing to disclose that AOL's online advertising revenues were almost certain to
in connection with the termination of contracts for online advertising;
C Artificially inflating AOL Time Warner's revenues from online advertising sales by
Defendant Ernst & Young, LLP violated the federal securities laws by
certifying AOL Time Warner's financial statements as incorporated in AOL Time Warner's Annual
stock dropped to as low as $11.75, down from its Class Period high of $58.51.
the Securities Exchange Act of 1934 and 28 U.S.C. § 1331.
materially false and misleading financial statements during the Class Period,
and misleading opinions with respect to such financial statements,
commentators began to question the viability of the online advertising business model.
Such Auditor's Report was materially misleading by virtue of the facts set forth
Young provided unqualified audit opinions relating to the above-referenced financial
Defendants made public misrepresentations or failed to disclose material
substantially participated or acquiesced in the issuance and/or dissemination of such
untrue statements of material fact and/or omitted to state material facts necessary to make
recklessly and for the purpose and effect of artificially inflating the market price of AOL
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