Tut Systems reaches settlement in shareholder lawsuits, agreeing to pay $10M

January 5, 2004

1 Min Read

PLEASANTON, Calif. -- Tut Systems, Inc. (Nasdaq: TUTS) announced today that it has reached settlements of the class action securities lawsuits that were brought in United States District Court for the Northern District of California on behalf of persons who purchased Tut Systems ("Company") securities between July 20, 2000 and January 31, 2001 and that subsequently were consolidated as In re Tut Systems, Inc. Securities Litigation, Master File No. C 01-2659 CW. The Company also announced that it has reached a settlement of the derivative lawsuit entitled Lefkowitz v. D'Auria, et al., No. RG03087467, that was brought in the Superior Court of the State of California, County of Alameda.

Subject to approval by the District Court, Tut Systems has agreed to pay $10 million to settle the consolidated class action lawsuits, which will be paid by the Company’s insurance company. Subject to approval by the Superior Court, the derivative lawsuit settlement involves the Company’s adoption of certain corporate governance measures and payment of attorneys’ fees and expenses to the derivative plaintiff’s counsel, which also will be paid by the Company’s insurance company. Both settlements include releases of all defendants.

"We’re pleased to be resolving these matters," stated Sal D’Auria, president, CEO and chairman of Tut Systems. "Settlement allows us to increase our focus on the future growth of the Company and avoid the time and resources required of litigation." Because the settlements are subject to court approval, there is no guarantee these settlements will become final.

Tut Systems Inc.

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