| Company: | Star Gas Partners |
| Ticker Symbol: | NYSE: SGU |
| Class Period: | April 20, 2003 to October 15, 2004 |
| Date Filed: | Oct-22-04 |
| Lead Plaintiff Deadline: | Dec-20-04 |
| Court: | District, CT |
| Allegations: |
A class action lawsuit was filed in the United States District Court for the District of Connecticut on behalf of all securities purchasers of Star Gas Partners, L.P. (NYSE: SGU - News; NYSE: SGH - News; "Star" and the "Partnership") from April 20, 2003 through October 15, 2004 inclusive (the "Class Period").
The complaint charges Star, Irik P. Sevin, and Ami Trauber with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that the Partnership failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Partnership was unable to pass costs of rising heating oil prices on to its customers because the Partnership had earlier acquired heating oil at a much lower cost; (2) that as a result of this, defendants were unable to increase or maintain profit margins in its heating oil segment; (3) that the Partnership was experiencing massive customer attrition; and (4) that the Partnership's Petro heating oil division's operational restructuring, undertaken at the beginning of the Class Period, was a complete and utter failure because of delays in the centralization of Star's dispatch system.
On October 18, 2004, Star issued a press release with the headline: "STAR GAS PARTNERS, L.P. ANNOUNCES SUSPENSION OF COMMON UNIT DISTRIBUTION." Therein, the Partnership stated that it had recently advised its Petro heating oil division bank lenders of a substantial expected decline in earnings for this division for the fiscal year that ended on September 30, 2004, and a further projected decline in earnings for the fiscal year ending September 30, 2005, which would not permit Petro to meet the borrowing conditions under its working capital line. According to Star, the source of the problem was a combination of (a) the inability to pass on the full impact of record heating oil prices to customers, and (b) the effects of unusually high customer attrition principally related to its operational restructuring undertaken in the past 18 months. Petro was continuing to submit borrowing requests under its working capital line. Star was in discussions with the lenders to modify conditions and other terms necessary to assure that Petro would have sufficient liquidity to operate through the winter. Star anticipated that because of the requirements of Star's current and potential lenders, it would not be permitted to make any distributions on its Common Units. Star believed that with the support of its existing lenders, which cannot yet be assured, it could manage the extraordinary challenges arising from current energy prices and other factors. However, without that support, Star may be forced to seek interim financing on extremely disadvantageous terms or even to seek to restructure its debts under the protection of the bankruptcy courts.
News of this shocked the market. Shares of Star fell $17.28 per share, or 80 percent, to close at $4.32 per share on unusually high trading volume on October 18, 2004.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
The complaint charges Star, Irik P. Sevin, and Ami Trauber with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. More specifically, the complaint alleges that the Partnership failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Partnership was unable to pass costs of rising heating oil prices on to its customers because the Partnership had earlier acquired heating oil at a much lower cost; (2) that as a result of this, defendants were unable to increase or maintain profit margins in its heating oil segment; (3) that the Partnership was experiencing massive customer attrition; and (4) that the Partnership's Petro heating oil division's operational restructuring, undertaken at the beginning of the Class Period, was a complete and utter failure because of delays in the centralization of Star's dispatch system.
On October 18, 2004, Star issued a press release with the headline: "STAR GAS PARTNERS, L.P. ANNOUNCES SUSPENSION OF COMMON UNIT DISTRIBUTION." Therein, the Partnership stated that it had recently advised its Petro heating oil division bank lenders of a substantial expected decline in earnings for this division for the fiscal year that ended on September 30, 2004, and a further projected decline in earnings for the fiscal year ending September 30, 2005, which would not permit Petro to meet the borrowing conditions under its working capital line. According to Star, the source of the problem was a combination of (a) the inability to pass on the full impact of record heating oil prices to customers, and (b) the effects of unusually high customer attrition principally related to its operational restructuring undertaken in the past 18 months. Petro was continuing to submit borrowing requests under its working capital line. Star was in discussions with the lenders to modify conditions and other terms necessary to assure that Petro would have sufficient liquidity to operate through the winter. Star anticipated that because of the requirements of Star's current and potential lenders, it would not be permitted to make any distributions on its Common Units. Star believed that with the support of its existing lenders, which cannot yet be assured, it could manage the extraordinary challenges arising from current energy prices and other factors. However, without that support, Star may be forced to seek interim financing on extremely disadvantageous terms or even to seek to restructure its debts under the protection of the bankruptcy courts.
News of this shocked the market. Shares of Star fell $17.28 per share, or 80 percent, to close at $4.32 per share on unusually high trading volume on October 18, 2004.
If you acquired the securities of the defendants during the Class Period you may, no later than the Lead Plaintiff Deadline shown above, request that the Court appoint you as lead plaintiff through counsel of your choice. You may also choose to remain an absent class member. A lead plaintiff must meet certain requirements.
If you feel you qualify for damages or remedies that might be awarded in this class action please fill in our form on the right to submit your complaint.
If your injustice does not match the complaint described above, please use this form to register your complaint. Thank you.
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