Bay Networks said it would "vigorously defend" itself against lawsuits filed by two shareholders. The suits allege that Bay artificially inflated its share price by making misleading statements about its products and market position.
The two separate filings are both class action suits claiming to seek damages on behalf of all shareholders who bought Bay common stock between 25 July 1995 and 14 October 1996. They claim that these shareholders were misled about the value of their holdings by "materially false and misleading statements" from Bay about its products, financial performance and market standing.
In an official statement, Bay said the suits were "without merit" and that it would contest them vigorously. The company could not comment further.
The plaintiffs also allege that 10 of Bay's current and former officers and directors from trading on undisclosed information.
One of the suits was filed in the US District Court for the northern district of California, citing breaches of federal securities laws. The other was filed in Santa Clara County and focuses on alleged violations of the California Corporations Code.
The actions have been sparked by last October's sharp fall in Bay's stock value after it reported first quarter results well below Wall Street expectations. It is the latest in a string of blows to the company, which has seen disappointing figures and the departure of many senior executives.
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