Securities Class Action Lawsuit Filed Against MCI Worldcom over SkyTel Communications Acquisition

Strategic Insights -

A class action lawsuit has been commenced in the United States District Court for the Eastern District of New York on behalf of those who sold common stock and call options or purchased put options of SkyTel Communications, Inc. between May 25 and May 28, 1999. The complaint alleges that MCI Worldcom falsely denied merger discussions with SkyTel to deflate the market price of SkyTel's common stock and lower the acquisition price. The lawsuit charges MCI Worldcom with violations of the Securities Exchange Act of 1934 and Rule 10b-5.

Key Takeaways:

  • A securities class action lawsuit was filed in the United States District Court for the Eastern District of New York on behalf of SkyTel Communications, Inc. sellers and option holders.
  • The complaint alleges that MCI Worldcom falsely denied merger discussions with SkyTel to deflate the market price of SkyTel's common stock.
  • MCI Worldcom's alleged actions led to potential investors losing money due to the artificially low stock price.
  • The lawsuit charges MCI Worldcom with violations of the Securities Exchange Act of 1934 and Rule 10b-5.
  • The class period includes all sales and purchases from May 25 to May 28, 1999.
  • Investors can contact Stanley D. Bernstein, Esq., or Michael S. Egan, Esq., at Bernstein Liebhard & Lifshitz, LLP, to discuss the action or their rights as a potential class member.

Statistics:

  • May 25 to May 28, 1999: the class period for the lawsuit.
  • 3 days: the duration of the alleged false denial by MCI Worldcom.
  • 1: the number of companies involved in the lawsuit (MCI Worldcom).
  • 2: the number of types of investors included in the lawsuit (sellers of common stock and holders of call options or purchase put options).

Sources:

  • PRNewswire, June 4, 1999, "Attention SkyTel Investors: Fraud Claims Asserted on Behalf Of Sellers of Skytel Communications, Inc. Securities"