Manugistics hails dismissal of suits against it, 2 officers

August 18, 1999|By Amanda J. Crawford | Amanda J. Crawford,SUN STAFF

Manugistics Group Inc. of Rockville announced yesterday that a class action shareholders suit filed against the company and two top officers last year has been dismissed.

Shareholders filed three lawsuits against the company, which provides inventory management software, in June 1998 after its stock fell 66 percent, from $47.875 to $29.25, in one day. The plunge followed the company's warning that first-quarter earnings would fall short of analysts' projections.

The suits, later consolidated in U.S. District Court in Baltimore, claimed that the company had made falsely optimistic statements about its finances that boosted its stock price.

"Manugistics has always supported the fact that it acted in good faith," Helen Nastasia, vice president and general counsel, said yesterday. "We were very gratified by the decision."

She said the company filed a motion to dismiss the case in May. U.S. District Judge Frederic N. Smalkin released an order of the court granting the motion to dismiss Aug. 6, Nastasia said.

The suit, which sought unspecified damages, also named as defendants William M. Gibson, Manugistics' chairman and former chief executive officer, and Peter Q. Repetti, vice president and chief financial officer. The suit alleged that some company officials profited from their inside knowledge by selling their shares.

Nastasia added that the company "always believed its officers acted in good faith."

Christopher S. Desautelle, an analyst with Legg Mason Wood Walker, said, "there was no merit to the lawsuit."

"It doesn't surprise me that it was dropped," he said. "It was just a tough business environment that nobody could have anticipated."

Shares of Manugistics closed yesterday at $12.75, up 25 cents.

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