Stamps.com 2002 Annual Report Download - page 22

Table of Contents
ownership of the “stamps.com” domain name. On January 17, 2003, we agreed to terms to settle the Cybershop domain name lawsuit. Pursuant
to the settlement, we will keep the domain name www.stamps.com and pay the plaintiffs an immaterial amount of cash.
In May and June, 2001, we were named, together with certain of our current or former board members and/or officers, as a defendant in eleven
purported class-action lawsuits, filed in the United States District Court for the Southern District of New York. The lawsuits allege violations of
the Securities Act of 1933 and the SecuritiesExchange Act of 1934 in connection with our initial public offering and secondary offering of our
common stock. The lawsuits also name as defendants the principal underwriters in connection with our initial and secondary public offerings,
including Goldman, Sachs & Co. (in some of the lawsuits sued as The Goldman Sachs Group Inc.) and BancBoston Robertson Stephens, Inc.
The lawsuits allege that the underwriters engaged in improper commission practices and stock price manipulations in connection with the sale
of our common stock. The lawsuits also allege that we and/or certain of our officers or directors knew of or recklessly disregarded these
practices by the underwriter defendants, and failed to disclose them in our public filings. Plaintiffs seek damages and statutory compensation,
including prejudgment and post-judgment interest, costs and expenses (including attorneys’ fees), and rescissionary damages. In April 2002,
plaintiffs filed a consolidated amended class action complaint against us and certain of our current and former board members and/or officers.
The consolidated amended class action complaint includes similar allegations to those described above and seeks similar relief. In July 2002,
we moved to dismiss the consolidated amended class action complaint. In October 2002, pursuant to a stipulation and tolling agreement with
plaintiffs, our current and former board members and/or officers were dismissed without prejudice. In February of 2003, the court denied our
motion to dismiss the consolidated amended class action complaint.
In addition to the class action lawsuits against us, over 1,000 similar lawsuits have also been brought against over 250 companies which issued
stock to the public in 1998, 1999, and 2000, and their underwriters. These lawsuits (including those naming us) followed publicized reports that
the SEC was investigating the practice of certain underwriters in connection with initial public offerings. All of these lawsuits have been
consolidated for pretrial purposes before United States District Court Judge Shira Scheindlin of the Southern District of NewYork. We have
placed our underwriters on notice of our rights to indemnification, pursuant to our agreements with the underwriters. We have also provided
notice to our directors and officers insurers, and believe that we have insurance applicable to the lawsuits. We also believe that the claims
against us and our officers and directors are without merit, and intend to defend the lawsuits vigorously.
We are not currently involved in any other material legal proceedings, nor have we been involved in any such proceeding that has had or may
have a significant effect on our company. We are not aware of any other material legal proceedings pending against us.
ITEM4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during the quarter ended December 31, 2002.
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2003. EDGAR Online, Inc.