The release quotes ECtel's President and CEO, Eitan Naor, as stating:
We're pleased with this confirmation of our earlier statements that we believe this case was filed without merit. This justifies our vigorous defense of this matter.According to their website, one of ECtel's products is known as FraudView and "is the leading and most complete fraud management solution for telecom operators." Hmm, that doesn't sound very good. I wonder if the finance folks at WorldCom were early adopters?
Also named as a defendant (and separately announcing their dismissal from the litigation, here) was ECI Telecom Ltd., a major shareholder of ECtel during the class period. Sadly, ECI's press release contains no similar justification, but presumably, they also mounted a vigorous defense.
Judge Roger W. Titus previously appointed Leumi Gemel Ltd. as lead plaintiff and Glancy Binkow & Goldberg LLP and the Law Offices of Jacob Sabo as appointed lead counsel. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. was appointed as liaison counsel.
According to Bank Leumi's 2004 Annual Report, Leumi Gemel Ltd. is a wholly owned subsidiary and:
manages provident funds for the self-employed, provident funds for salaried employees, central funds for severance pay and a fund for the payment of sick pay and Psagot Ofek [Israel's leading investment house]As an aside, ECI Telecom, Ltd. (NASDAQ: ECIL), the ECtel shareholder named as a defendant in this litigation, settled a prior securities class action alleging that the company fraudulently engaged in a premature revenue recognition scheme, which violated both Generally Accepted Accounting Principles and ECI's own accounting policies. That case settled in 2002 for $21.75 million.
Thanks to an anonymous reader for sending in the ECtel press release.