UNITED STATES DISTRICT COURT DISTRICT OF CONNECTICUT X SOLOMON EISENBERG, ) CIVIL ACTION NO. On Behalf of Himself and All Others ) cics CU 1-5 n Similarly Situated, ) ) (.2 Plaintiff, ) CLASS ACTION COMPLAINT (i VS. ) FOR THE VIOLATION OF ) FEDERAL SECURITIES LAWS ) ROBERT P. KRASS, ROBERT J. HART, ) PETER B. MANCINO, WILLIAM P. WEIMELS,) FRED C. WOLF, R. EUGENE CARTLEDGE, ) JOHN R. HALL, GLENN H. HUTCHINS, ) ROBERT D. KENNEDY, HOWARD A. LIPSON, ) PETER G. PETERSON, STEPHEN A. ) SCHWARZMAN, DAVID A. STOCKMAN ) and UCAR INTERNATIONAL, INC., ) JURY TRIAL DEMANDED ) Defendants. ) X APRIL 1, 1998 Plaintiff alleges the following, upon information and belief, based upon the investigation of his counsel, which included a review of the SEC filings of defendant UCAR International, Inc. ("UCAR" or the "Company"), securities analyst reports about the Company, press releases issued by the Company, and media reports about the Company, and court filings, and believes that substantial evidentiary support will exist for the allegations set forth in this complaint after a reasonable opportunity for complete discovery. OVERVIEW OF THE ACTION 1. Plaintiff brings this action on behalf of all persons who purchased the common stock of UCAR from August 15, 1995, the date of the initial public offering of UCAR stock, through March
13, 1998 (the "Class Period"), to recover damages resulting from defendants material misrepresentations and omissions which caused the price of UCAR stock to be artificially inflated. 2. Since the beginning of the Class Period, defendants have materially misrepresented the earnings of UCAR. Defendants materially inflated UCAR's earnings by concealing from plaintiff, class members and the investing public defendants' participation in an illegal, price-fixing conspiracy that was designed to and did cause the market price of graphite electrodes to become and remain unlawfully inflated enabling the Company to report inflated earnings. In particular, throughout the Class Period, defendants continuously participated in a series of meetings held in the Far East, Europe and the United States during which UCAR and its co-conspirators agreed to increase prices, eliminate discounts and set production volumes for graphite electrodes in violation of federal and state antitrust laws. Statements disseminated by the Company concerning UCAR's financial performance thus were materially false and misleading, as these statements were predicated upon revenue and earnings reported by the Company which were based upon prices which were illegally maintained at high levels. 3. As a result of defendants' deceptive and illegal conduct, plaintiff and other class members purchased their UCAR shares at grossly inflated prices. Had plaintiff and the other class members been aware of the true condition of UCAR, they -2-
would not have purchased their UCAR shares at the inflated prices they paid. JURISDICTION AND VENUE 4. Jurisdiction exists pursuant to Section 27 of the Securities Exchange Act of 1934 ("Exchange Act"), 15 U.S.C. 78aa, and 28 U.S.C. 1331 and 1337. The claims asserted herein arise under Sections 10(b) and 20(a) of the Exchange Act, 15 U.S.C. 78j(b), 78t(a) and 78t-1, and Rule 10b-5 promulgated by the Securities and Exchange Commission and under state law. 5. Venue is proper in this District pursuant to Section 27 of the Exchange Act and 28 U.S.C. 1391(b). Many of the acts giving rise to the violations complained of occurred in this District, and UCAR's principal executive offices are located in this District. 6. In connection with the wrongs complained of, defendants used the instrumentalities of interstate commerce, including the U.S. mails and the facilities of the national securities markets. PARTIES 7. Plaintiff Solomon Eisenberg purchased 1000 shares of UCAR common stock during the Class Period and has suffered damages thereby. 8. Defendant UCAR is a corporation duly organized and existing under the laws of the State of Delaware. The Company's principal executive offices are located at 39 Old Ridgebury Road, Danbury, Connecticut 06817. The Company is the world's largest manufacturer of graphite and carbon electrodes. The graphite -3-
electrodes manufactured by the Company are primarily used to produce steel from scrap metal in electric-arc furnaces, minimills and ladle furnaces. 9. Defendant Robert P. Krass ("Krass") served at relevant times during the Class Period as the Chairman of the Board of Directors, Chief Executive Officer and President of UCAR until March 13, 1998, when he suddenly retired, effective immediately, without any warning or explanation. During the Class Period, Defendant Krass sold 55,000 shares of UCAR common stock while in possession of materially adverse non-public information concerning UCAR and realized proceeds totaling approximately $1,945,900. Upon information and belief, because of defendant Krass's position with the Company, he participated in the illegal price-fixing scheme and he knew the adverse non-public information about its business, finances and business prospects via his access to internal corporate documents (including the Company's operating plans, budgets and forecasts and reports of actual operations compared thereto), conversations and connections with other corporate officers and employees, conversations with other Chief Executive Officers or other representatives of other companies conspiring in the price-fixing scheme, attendance at management and Board of Directors' meetings and committees thereof and via reports and other information provided to him in connection therewith. 10. Defendant Robert J. Hart ("Hart") at relevant times during the Class Period served as senior Vice President, Chief -4-
Operating Officer and General Manager (North and South America) of UCAR until March 13, 1998, when he suddenly retired, effective immediately, without any warning or explanation. During the Class Period, defendant Hart sold 57,000 shares of UCAR common stock while in possession of materially adverse non-public information concerning UCAR and realized proceeds totaling approximately $2,493,000. Upon information and belief, because of defendant Hart's positions with the Company, he knew the adverse non-public information about its business, finances, products, markets and business prospects via his access to internal corporate documents (including the Company's operating plans, budgets and forecasts and reports of actual operations compared thereto), conversations and connections with other corporate officers and employees, attendance at management and Board of Directors' meetings and committees thereof and via reports and other information provided to him in connection therewith. 11. Defendant Peter B. Mancino ("Mancino") has served as Vice President, General Counsel and Secretary of UCAR at relevant times during the Class Period. During the Class Period, defendant Mancino sold 45,000 shares of UCAR common stock while in possession of materially adverse non-public information concerning UCAR and realized proceeds totaling approximately $2,086,580. 12. Defendant William P. Wiemels ("Wiemels") has served as Vice President, Chief Financial Officer and Treasurer of UCAR at -5-
relevant times during the Class Period. During the Class Period, defendant Wiemels sold 30,000 shares of UCAR common stock while in possession of materially adverse non-public information concerning UCAR and realized proceeds totaling approximately $1,425,600. 13. Defendant Fred C. Wolf ("Wolf") has served as Vice President, Administration and Strate g ic Projects, of UCAR at relevant times during the Class Period. During the Class Period, defendant Wolf sold 75,000 shares of UCAR common stock while in possession of materially adverse non-public information concerning UCAR and realized proceeds totaling approximately $3,443,750. 14. Defendant R. Eugene Cartledge ("Cartledge") has served as a Director of UCAR at relevant times during the Class Period. 15. Defendant John R. Hall ("Hall") has served as a Director of UCAR at relevant times during the Class Period. 16. Defendant Glenn H. Hutchins ("Hutchins") has served as a Director of UCAR at relevant times during the Class Period. 17. Defendant Robert D. Kennedy ("Kennedy") has served as a Director of UCAR at relevant times during the Class Period. 18. Defendant Howard A. Lipson ("Lipson") has served as a Director of UCAR at relevant times during the Class Period. 19. Defendant Peter G. Peterson ("Peterson") has served as a Director of UCAR at relevant times during the Class Period. -6-
20. Defendant Stephen A. Schwarzman ("Schwarzman") has served as a Director of UCAR at relevant times during the Class Period. 21. Defendant David A. Stockman ("Stockman") has served as a Director of UCAR at relevant times during the Class Period. 22. Each of defendants Hutchins, Lipson, Peterson, Schwarzman, and Stockman were the beneficial owners of 7,711,227 shares of UCAR stock which was sold in April 1997 for proceeds of approximately $282,076,683 while such defendants were in possession of materially adverse non-public information concerning UCAR. 23. Each of the foregoing individual defendants are collectively sometimes hereinafter referred to as the "Individual Defendants." 24. During the Class Period, by reason of their senior management positions and day-to-day operation of the activities of UCAR, or by membership on the Board of Directors of UCAR, the Individual Defendants were controlling persons of UCAR within the meaning of Section 20 of the Exchange Act and each exercised the power and influence to cause, and did cause, UCAR to engage in the unlawful conduct complained of herein. Each of the Individual Defendants is sued as a direct participant in the wrongdoing as alleged herein and in his capacity as a controlling person of UCAR. These defendants, because of their positions of control, were able to and did, directly or indirectly, control the business of UCAR, as well as the contents of the annual and -7-
quarterly financial reports of UCAR, other SEC filings, public statements and press releases. Each of the defendants knew, or in reckless disregard of the facts should have known, that a significant portion of UCAR's revenues and growth depended on the Company's price-fixing and other anti-competitive practices. As senior officers and/or directors of a publicly-held company whose stock is registered with the SEC under the Securities Act of 1933, these defendants had a duty to promptly disseminate accurate and truthful information with respect to the operations, earnings performance, management and business prospects of UCAR, and to correct any previously issued statements that had become untrue, so that the market price of the securities of UCAR would be based on truthful and accurate information. 25. Notwithstanding their duty, the Individual Defendants participated in the alleged wrongdoing, in part, to artificially inflate the market price of UCAR common stock by prolonging the illusion of UCAR's continued growth and success, inflating UCAR's publicly reported revenue, earnings, assets and net worth, and concealing the adverse facts which impacted the business and financial condition of UCAR, which were unknown to the investing public, in order to artificially inflate the market price of UCAR common stock. The Individual Defendants made the material misrepresentations, omissions and misleading statements alleged herein so that they could, among other things, increase the market price of their shares of UCAR, which many of the Individual Defendants sold at a substantial profit, protect their -8-
executive and/or directorship positions through which they received large salaries, and conceal and cover up their own prior and current misconduct and avoid being held responsible therefor. CLASS ALLEGATIONS 26. Plaintiff brings this action as a class action pursuant to Federal Rules of Civil Procedure 23 (a) and 23(b)(3) on behalf of all persons who purchased the common stock of UCAR during the Class Period, except defendants, members of their immediate families and any entity in which a defendant has a controlling interest (the "Class"). 27. The members of the Class are so numerous that joinder of all members is impracticable. UCAR has more than 47 million shares of stock outstanding. During the Class Period, millions of shares of UCAR stock were purchased by at least hundreds of persons who were damaged thereby. Plaintiff's claims are typical of the claims of the Class because plaintiff and the Class members sustained damages arising from and proximately caused by defendants' wrongful conduct. 28. Plaintiff will adequately protect the interests of the Class. Plaintiff has retained counsel experienced and competent in class action securities litigation. Plaintiff has no interests which are in conflict with those of the Class. 29. A class action is superior to other available methods for the fair and efficient adjudication of this controversy. -9-
30. Common questions of law and fact predominate over questions which affect only individual members. Among the questions of law and fact common to the Class are: (a) Whether the federal securities laws were violated by defendants acts; (b) Whether defendants' statements during the Class Period misrepresented and/or omitted material facts; (c) Whether defendants pursued the fraudulent scheme and course of conduct complained of; (d) Whether the press releases, SEC filings and other public statements disseminated by defendants omitted material facts about the Company's price-fixing and other anti-competitive activities; (e) Whether defendants acted intentionally or recklessly; (f) Whether the market price of the Company's stock was inflated due to the activities complained of; and (g) The extent and measure of damage sustained by the Class. 31. A class action is superior to other available methods for the fair and efficient adjudication of this controversy. The Class is so numerous and geographically dispersed that it would be impracticable for each member of the Class to bring a separate action or to be joined in an individual action. The individual damages of any member of the Class may be relatively small when measured against the potential costs of bringing this action, and - 10 -
thus make the expense and burden of this litigation unjustifiable for individual actions. In this class action, the Court can determine the rights of all members of the Class with judicial economy. 32. There will be no difficulty in the management of this litigation which would preclude its maintenance as a class action. The names and addresses of the record owners of the shares of the Company's common stock purchased during the Class Period are available from the Company's transfer agent. Notice can be provided to such record owners and all Class Members by a combination of published notice and first-class mail, using techniques and a form of notice similar to those customarily used in class actions arising under the federal securities laws. SUBSTANTIVE ALLEGATIONS 33. UCAR is one of the world's leading producers of graphite and carbon products for industrial applications in a diverse array of industries. The Company's products include graphite and carbon electrodes, graphite specialties, carbon specialties, cathode blocks, and grafoil, and are manufactured on four continents and sold in over 70 countries around the world. 34. UCAR is the world's largest manufacturer of graphite electrodes. Graphite electrodes are large carbon columns used by steel "mini-mills" to melt scrap steel in electric arc furnaces and to refine steel in ladle furnaces. Because of the intense - 11 -
heat involved in this process, the graphite electrodes used in these furnaces are constantly being consumed. As a result, steel manufacturers are constantly purchasing new graphite electrodes in order to replace the electrodes consumed in the steel making process. 35. Upon information and belief, during the period 1993 through January 1997, UCAR, acting in concert with its coconspirators, participated in a series of meetings held in the Far East, Europe and the United States during which UCAR and its co-conspirators agreed to increase prices, eliminate discounts and set production volumes for graphite electrodes in violation of federal and state antitrust laws. 36. In addition, upon information and belief, during this same period, UCAR and its co-conspirators, including Showa Denko Carbon, Inc., SGL Carbon AG, and Carbide/Graphite Group, Inc., also illegally agreed to allocate the world market for graphite electrodes amongst themselves and, acting in furtherance of this agreement, allocated control of specific geographic regions amongst the co-conspirators, fixed prices in these regions as agreed among the co-conspirators, and restricted access of geographic electrode makers not involved in the conspiracy. 37. On June 5, 1997, UCAR's offices were raided by agents of the Federal Bureau of Investigation with search warrants and subpoenas, seeking documents and records regarding the Company's graphite electrode activities, to be used in connection with their investigation of UCAR's anti-competitive activities. - 12 -
38. In an effort to downplay the event, on that same date, the Company announced over the PR Newswire that: [']t has been served with a subpoena issued by a grand jury empaneled by the United States District Court for the Eastern District of Pennsylvania and a related search warrant. Counsel for the Company has been informed by members of the Federal Bureau of investigation that attorneys for the Antitrust Division of the United States Department of Justice and the grand jury are investigating price fixing by producers of graphite electrodes. The Company, through its counsel, is cooperating with the government in the investigation. At this time, as far as the Company is aware, the government has not made a finding that any person or company violated the law. 39. Reacting to this news, the Company's stock price dropped $6 3/8 to close at $41 7/8 on June 5, 1997. 40. On June 16, 1997, the Company announced over the PR Newswire that it had been served with a complaint commencing a class action lawsuit seeking damages on behalf of steel makers consuming graphite electrodes. In another effort to mitigate this bad news, the Company stated that: "The complaint does not contain any specific factual allegations of wrongdoing, and appears to be based on the existence of the previously announced governmental investigation." 41. The market, reacting to this news, caused the stock to close the next day at $41, a $3 1/8 drop from the previous day. 42. On July 17, 1997, the Company reassured investors by reporting record earnings. In the Company's announcement over the PR Newswire, the Company made no mention of the Department of - 13 -
Justice ("DOJ") investigation nor of the antitrust class action lawsuit pending against the Company. 43. On November 4, 1997, the Company filed with the SEC its report of financial results for the period ending September 30, 1997 on Form 10-Q. In the section of the Company's 10-Q entitled "Legal Proceedings," the Company summarized the investigation of the Department of Justice, and the antitrust class action lawsuit filed on June 17, 1997. It then continued: Subsequently through October 30, 1997, the Company has been served with four additional complaints commencing similar lawsuits in the District Court.... In each complaint, the plaintiffs allege that the defendants violated Federal antitrust laws. None of the complaints contains any specific allegations of the factual basis underlying such violations, and all of the complaints appear to be based on the existence of the previously announced grand jury investigation. On October 10, 1997, the District Court ordered a nine-month stay of certain formal discovery proceedings. 44. Once again, as a result of the Company downplaying the investigation, the market did not fully react to the information, and the Company's stock price did not falter, and even increased slightly over the next few weeks. THE TRUTH BEGINS TO BE REVEALED 45. On February 23, 1998, Showa Denko Carbon, Inc., a U.S. subsidiary of a Japanese company and one of the targets of the federal grand jury probe, agreed to plead guilty to having participated in a worldwide conspiracy to fix prices for graphite electrodes in violation of federal antitrust laws. It also agreed to pay a fine in the amount of $29 million -- the fourth - 14 -
largest fine ever levied by the DOJ antitrust division. In making the announcement, Justice Department officials made clear that the probe would continue against other co-conspirators, including UCAR. 46. On that same day, Credit Suisse First Boston Corporation ("First Boston") downgraded the Company's stock from Buy to Hold in light of the adverse news. The analyst covering the stock, Thomas M. Van Leeuwen ("Van Leeuwen"), stated: The major implication for UCAR is that potential damages could be much greater than we expected. Conversations with the company's outside counsel had previously led us to believe that a DOJ fine, in the event of a finding of wrongdoing, would amount to a maximum of 810 million, the statutory maximum for corporations convicted of violating the Sherman Antitrust Act. Yet, according to the DOJ press release, penalties can be increased to twice the amount of any gain to the conspirators (or twice the loss to customers) if that amount exceeds the $10 million statutory fine. This appears to have been the case with Showa Denko. While we believe the electrode industry structure provides producer pricing power, in the event that the DOJ did find against UCAR, its greater market share... would likely produce a criminal liability much higher than Showa Denko's -- perhaps as much as $50 million. Given Showa Denko's plea, the market may assume a worst case scenario for UCAR. A $50 million... potential criminal fine could remain discounted in UCAR's stock price until the company's innocence is proven.... Potential civil damages are also likely to remain discounted in UCAR shares.... Using its worst-case discount, the market is likely to assume that any civil damages could be substantial.... In all, it would seem that the liabilities for UCAR could total as much as $125 million - 8200 million, or about 82.65-$4.24 per share pretax. (Emphasis added.) - 15 -
47. In light of the adverse news about the Company, the market reacted swiftly and the Company's shares fell $5.88, or 13%, to end at $34 on volume of over 4.7 million shares, compared with an average daily turnover of 144,500 shares. 48. On February 25, 1998, the Company responded over the PR Newswire to the plea agreement. Mancino attempted to reassure investors by stating that: Neither UCAR nor any officer of UCAR has been charged in the... investigation.... The Company is continuing to cooperate with the government in its investigation and the Company intends to continue to vigorously defend against the related civil suit. We are continuing to evaluate the DOJ announcement. It is our policy, however, not to comment on specific developments relating to the investigation or the civil suit. 49. On March 13, 1998, the Company further shocked the market by announcing that Krass and Hart suddenly retired, effective immediately. The Company stated that it refused to comment on this event because of its policy not to comment on specifics of personnel matters or developments in any ongoing investigations or litigation. stated: 50. In its analyst report on March 13, 1998, First Boston We believe the abrupt retirements of chairman and CEO Robert Krass and COO Robert Hart... may point to difficulties ahead for the company with respect to the... investigation. * * * The language used by the DOJ in its case against Showa Denko and in a subsequent speech leads us to conclude that the DOJ believes it can prove other companies were involved in the - 16 -
conspiracy and that their fines for such activity would be substantial. 51. In addition, on March 16, 1998, First Boston announced: We believe the sudden CEO and COO retirements point to troubles ahead. Further, potential fines against UCAR... could be significantly greater than we had previously estimated. We now envision a worst case scenario for U.S. DOJ, U.S. class action, and Western European penalties of more than $400 million, double our previous $200 million worst case estimate. 52. News of the breadth of the investigation and the nature of the downturn of the Company stunned the investment community as the price of UCAR's stock plummeted on March 16, 1997 by $4.438 to close at $27.50, its lowest since UCAR became a publicly traded company in 1995. 53. Following the Class Period, on March 31, 1998, UCAR announced that it was recording a charge of $340 million for potential liabilities arising out of the antitrust investigations in the United States and Europe as well as associated civil antitrust lawsuits and claims and legal costs, and that the Company was restating its previously reported results for the fourth quarter of 1997 and for the entire 1997 year. The restatement resulted in a net loss of $160 million (rather than a profit of $147 million) for 1997 and a net loss of $276 million (rather than a profit of $31 million) for the fourth quarter of 1997. 54. The Company, through its officers and directors, committed a series of fraudulent acts upon the market. These acts included (i) the dissemination of materially false and - 17 -
misleading earnings and statements to the public through the Company's SEC filings throughout the Class Period, including the Company's Registration Statement and Prospectus filed in connection with its initial public offering in August 1995 and all quarterly and annual filings with the SEC thereafter, and in press releases and statements to analysts regarding the Company's role and involvement in the worldwide conspiracy to engage in the price-fixing of the graphite electrode products and (ii) the failure to disclose in the Registration Statement and the quarterly and annual SEC filings that the revenues and earnings of UCAR were inflated through the illegally fixed prices of its products. These acts were committed during the class period in order to inflate the price of the common stock and to inflate the revenues, financial condition and business prospects of the Company. SCIENTER ALLEGATIONS 55. As alleged herein, defendants acted with scienter in that the Individual Defendants knew or recklessly disregarded that the public documents and statements issued or disseminated in the name of UCAR were materially false and misleading; knew that such statements or documents would be issued or disseminated to the investing public; and knowingly or recklessly substantially participated or acquiesced in the issuance or dissemination of such statements or documents as primary violators of the federal securities laws. As set forth elsewhere herein in detail, defendants, by virtue of their receipt of - 18 -
information reflecting the true facts regarding UCAR, their control over, and/or receipt and/or modification of UCAR's allegedly materially misleading misstatements and/or their associations with UCAR's which made them privy to confidential proprietary information concerning UCAR, directly participated in the fraudulent scheme alleged herein. Defendants knew and/or recklessly disregarded the falsity and misleading nature of the information which they caused to be disseminated to the investing public. 56. The Individual Defendants engaged in such a scheme to inflate the price of UCAR securities in order to enhance the value of their personal UCAR securities, including large amounts of UCAR stock which they sold during the Class Period, and to ensure the success of the initial public offering of UCAR stock. 57. The Individual Defendants were further motivated to commit the wrongs alleged herein in order to maintain the substantial compensation and prestige they obtained from their positions with the Company. - 19 -
COUNT I Section 10(b) Of The Exchange Act And Rule 10b-5 58. Plaintiff incorporates each and every allegation set forth above as if fully set forth below. 59. During the Class Period, the defendants engaged in a course of conduct, described above, pursuant to which they knowingly or recklessly engaged in acts, transactions, practices, and a course of business which operated as a fraud upon plaintiff and the other members of the Class; made various untrue statements of material facts and omitted to state material facts necessary to make statements made, in light of the circumstances under which they were made, not misleading to plaintiff and the other Class members; and employed manipulative and deceptive devices and contrivances in connection with the purchase of UCAR securities. 60. The purpose and effect of the defendants' plan, scheme, conspiracy and course of conduct was to artificially inflate the price of the Company's common stock and then artificially maintain the market price of said common stock. 61. The Individual Defendants, through their positions with the Company, had actual knowledge of the material omissions and/or the falsity of the statements set forth above, and intended to deceive plaintiff and the other members of the Class or, in the alternative, acted with reckless disregard for the truth when they failed or refused to ascertain and disclose in - 20 -
the aforementioned documents the true facts to plaintiff and the other members of the Class. 62. Defendant UCAR and the Individual Defendants had actual knowledge of the material omissions and/or the falsity of the statements set forth above, and intended to deceive plaintiff and the other members of the Class or, in the alternative, acted with a reckless disregard for the truth when defendants failed or refused to ascertain and disclose in the aforementioned documents the true facts to plaintiff and the other members of the Class. 63. As a result of the foregoing, the market price of UCAR common stock was artificially inflated during the Class Period. In ignorance of the materially false and misleading nature of the misrepresentations described above made by defendants, and the deceptive and manipulative devices and contrivances employed by the defendants, plaintiff and the other members of the Class relied, to their detriment, on the integrity of the market price of the stock in purchasing UCAR stock. Had plaintiff and the other members of the Class known of the material adverse information not disclosed by the defendants, they would not have purchased UCAR common stock at the artificially inflated prices that they did. 64. Plaintiff and the other members of the Class have suffered substantial damages as a result of the wrongs alleged herein. 65. By reason of the foregoing, defendants have violated Section 10(b) of the Exchange Act and Rule 10b-5 promulgated - 21 -
thereunder, in that they: (a) employed devices, schemes and artifices to defraud; (b) made untrue statements of material fact or omitted to state material facts necessary to make the statements made not misleading; and (c) engaged in acts, practices and a course of business which operated as a fraud or deceit upon plaintiff and the other members of the Class in connection with their purchases of UCAR common stock during the Class Period. - 22 -
COUNT II Section 20(a) Of The Exchange Act Against the Individual Defendants 66. Plaintiff incorporates each and every allegation set forth above as if fully set forth below. 67. The Individual Defendants acted as controlling persons of the Company within the meaning of 20 of the Exchange Act. By reasons of their positions as with the Company, the Individual Defendants had the power and authority to cause the Company to engage in the wrongful conduct complained of herein. 68. By reason of such wrongful conduct, the Individual Defendants are liable pursuant to 20(a) of the Exchange Act. As a direct and proximate result of the Individual Defendant's wrongful conduct, plaintiff and the other members of the Class suffered damages in connection with their purchases of the Company's securities during the Class Period. PRAYER FOR RELIEF WHEREFORE, Plaintiff and the Class demand judgment as follows: 1. Declaring that this action shall be maintained as a class action and appointing plaintiff the lead plaintiff and his counsel lead counsel; 2. Declaring and determining that the defendants violated the federal securities laws by reason of their conduct as alleged herein; - 23 -
3. Directing defendants, jointly and severally, to pay to plaintiff and to all members of the Class damages in an amount to be proven at trial, with interest thereon; 4. Awarding plaintiff and the Class their reasonable costs and expenses incurred in this action, including counsel fees and expert fees; and 5. Such other and further relief as the Court may deem just and proper. JURY TRIAL DEMANDED Plaintiff demands a trial by jury of all issues so triable. Plaintiff Solomon Eisenberg, on behalf of himself and all others similarly situated, By: Andrew M. Schatz (ct 00603) Jeffrey S. Nobel (ct 04855) SCHATZ & NOBEL, P.C. 216 Main Street Hartford, Connecticut 06106 (860) 493-6292 -- and -- Joseph H. Weiss Richard A. Acocelli Jack I. Zwick WEISS & YOURMAN 551 Fifth Avenue Suite 1600 New York, NY 10176 (212) 682-3025 - 24 -
CERTIFICATION OF PLAINTIFF PURSUANT TO FEDERAL SECURITIES LAWS SOLOMON EISENBERG ( "Plaintiff"), under the penalties of perjury, hereby certifies as follows: 1. I have reviewed the complaint being filed on my behalf and on behalf of all others similarly situated and authorized its filing. 2. I did not purchase the security that is the subject of this action at the direction of counsel or in order to participate in this private action. 3. I am willing to serve as a representative party on behalf of the class, including providing testimony at deposition and trial, if necessary. 4. To the best of my current knowledge, the following are all my transactions in UCAR International, Inc. securities during the Class Period: Date & Type of Transaction No. of Shares Price Der Share 03-06-98 Purchase 1,000 $34 9/16 03-16-98 Sale 500 $30 3/8 03-16-98 Sale 500 $30 15/16 S. I have been a named plaintiff in one federal securities class action case in the last three years: Brooke Graubart et al. v. Insignia Solutions, PLC, No. C-97-20265-JW. 6. I will not accept any payment for serving as a representative party on behalf of the class beyond Plaintiff's pro rata share of any recovery, except as ordered or approved by the court, including any award for reasonable costs and expenses TOTAL P.02
2d 1b101 (including lost wages) directly relating to the representation of the class. 7. The matters stated in this certification are true to the best of my current knowledge, information and belief. 8. hereby certify, under penalty of perjury, that the foregoing is true and correct. DATED: April, 1988 A 14 SOLOMON EISENBERG A / -2-20/20-0'02 E89 ECE' 14:11d1 boa E2'Z' 866t r0-8du