A
class
action lawsuit has been filed on behalf of people who purchased shares of
eConnect, Inc., common stock between November 23, 1999 and March 13, 2000.
eConnect,
Inc., of San Pedro, California (www.econnectholdings.com)
has a division called Powerclick.com. Powerclick.com is a merchant portal
that features more than 200 merchant listings aimed at generating revenues
based on fees per click. This suit may be of interest to ISOs because
eConnect also has “Internet Cash Payment Portals” which aim to sign up
merchants and generate revenues through merchant application, listing,
affiliate link, and transaction fees. eConnect is also in the business of
developing hardware and software systems designed to enable online remote,
credit, and ATM card based transactions, such as those used for online
gambling.
The
complaint states that during the Class Period defendants made false and
misleading statements and/or omissions concerning the financial condition
and business prospects of the company, while disregarding information
which would have been of material importance to any reasonable
shareholder.
The
complaint also alleges that defendants failed to disclose:
(a) that, contrary to
eConnect’s November 23, 1999 press release, eConnect had never acquired
Top Sports SA;
(b) that, contrary to
eConnect’s February 22, 2000 press release, eConnect was not generating
anywhere near $10,000 a day from its PowerClick division’s network of
Web sites;
(c) that, contrary to
eConnect’s February 28, 2000 press release, eConnect did not have a
strategic alliance with Empire Financial Group, Inc.; and
(d) that, contrary to
the implication of eConnect’s February 29, 2000 SEC filing, eConnect did
not have an agreement to use an Internet cash payment system developed by
SafeTPay.
According
to the complaint, the disclosure of these and other facts would have
caused a severe collapse in the price of the company’s stock and the
defendants schemed to conceal these facts in order to artificially inflate
eConnect’s stock price.
If
you have questions about the case, contact the law offices of Weiss &
Yourman at (800) 437-7918 or wyinfo@wyca.com
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