XO Communications Faces Lawsuit

Law firm alleges shareholder equity was "destroyed" in exchange for $800m cash infusion on Nov 29, 2001

December 10, 2001

2 Min Read

The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Eastern District of Virginia on behalf of all purchasers of the common stock of XO Communications (Nasdaq: XOXO) from April 4, 2001 through November 29, 2001, inclusive (the "Class Period"). If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Stuart L. Berman, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at [email protected]. The Complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5 by, among other things, issuing false and misleading statements regarding XO's financial condition as well as its present and future business operations. In particular, the Complaint alleges that defendants misled the investing public concerning the Company's ability to finance its business operations until it becomes cash- flow positive. Throughout the Class Period, defendants stated that XO had sufficient cash to survive at least into mid 2003 without the need for further financing. These statements were false, and on November 29, 2001, defendants announced a transaction where the shareholders' equity was destroyed in exchange for a cash infusion of $800 million. Trading in the Company's stock was immediately halted. Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, LLP, who has significant experience and expertise prosecuting class actions on behalf of investors and shareholders. For more information on Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com. If you are a member of the class described above, you may, not later than February 4, 2002, move the Court to serve as lead plaintiff of the class, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements.

Schiffrin & Barroway, LLP

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