LeapFrog 2003 Annual Report Download - page 26

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to any of the complaints, discovery has not commenced, and no trial date has been established. While we intend
to defend against these actions vigorously and do not believe that these lawsuits will have a material effect on our
financial position, results of operations or cash flows, there can be no assurance as to the ultimate disposition of
these lawsuits.
On December 9, 2003, a stockholder derivative complaint entitled Santos v. Michael Wood, et al.,
No. RG03130947, was filed in the Superior Court of the State of California, County of Alameda, against certain
of our officers and directors. The complaint alleges causes of action for breach of fiduciary duty, abuse of
control, gross mismanagement, waste of corporate assets, unjust enrichment and violations of the California
Corporations Code, based upon allegations that certain of our officers and directors participated in the conduct
alleged in the securities class action complaints and participated in alleged improper stock sales. The complaint
seeks unspecified damages against the individual defendants on behalf of LeapFrog, equitable relief and
attorneys’ fees. On February 11, 2004, we filed a motion to dismiss this derivative complaint. The basis of our
motion is that we believe the plaintiff does not have standing to bring this lawsuit since the plaintiff has never
served a demand on our board of directors that the board take certain actions on behalf of LeapFrog. The
individual officer and director defendants have also filed a similar motion to dismiss this stockholder derivative
complaint. The hearing on these motions is expected to take place in April 2004. Discovery has not commenced
and no trial date has been established.
Item 4. Submission of Matters to a Vote of Security Holders.
No matters were submitted to our stockholders during the fourth quarter of our 2003 fiscal year.
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