in re: en pointe technologies, inc. securities litigation...
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James C. Krause, Esq ., SBN 66,478Patrick N. Keegan, Esq ., SBN 167,698Eric J. Benink, Esq., SBN 187434KRAUSE & KALFAYAN1010 Second Avenue, Suite 1750San Diego, CA 9210 1Tel: (619) 232-0331Fax: (619) 232-4019
Burton H. Finkelstein, Esq .Donald J . Enright, Esq .FINKELSTEIN, THOMPSON & LOUGHRAN1055 Thomas Jefferson Street, NW, Suite 601Washington, DC 20007Tel: (202) 337-8000Fax: (202) 337-8090
Lead Counsel for Lead Plaintiffs(Additional Counsel on Signature Page)
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BY :
R.LED.Off -27
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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA
In re EN POINTE TECHNOLOGIES, INC .SECURITIES LITIGATION
This Document Relates To :
ALL ACTIONS
First Amended Consolidated Class Action Complai
o Pur4
Master Case No. 01-CV-0205 L (CGA)
FIRST AMENDED CONSOLIDATE D} CLASS ACTION COMPLAINT FOR
VIOLATIONS OF THE FEDERALSECURITIES LAWS
JURY TRIAL DEMANDED
Master Case No . O1-CV-0205 L (CGA)
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I TABLE OF CONTENT S
2 INTRODUCTION AND OVERVIEW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
3 JURISDICTION AND VENUE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
4 PARTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
5 SUBSTANTIVE ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6 Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
7 The Hampton- Porter/En Pointe Connection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
8 Defendants Prepare Their Fraudulent Scheme . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2
9 Laurienti ' s First Union Securities , Inc . Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 5
10 Defendants Begin the Manipulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 7
11 Post-Class Period Events . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 8
12 CAUSATION ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
13 ADDITIONAL SCIENTER ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 1
14 FRAUD ON THE MARKET ALLEGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
15 FIRST CLAIM FOR RELIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35Violations of Section 10(b) of The Secu rities Exchange Act of 1934
16 and Rule IOb-5 Promulgated thereunder
17 SECOND CLAIM FOR RELIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36Violations of Section 20(a) of The Securities Exchange Act of 193 4
18THIRD CLAIM FOR RELIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 7
19 For Violations of Sections 10(b) and 20A of The Secu rities Exchange Act of 193 4
20 PRAYER FOR RELIEF . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 8
21 DEMAND FOR JURY TRIAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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First Amended Consolidated Class Action Complaint 11 Master Case No. 01-CV-0205 L (CGA)
1 Appointed Lead Plaintiffs Robert Flamberg, Wilford Gentry, Robert Mayer, Dennis Pasko,
2 and Richard Tavano (hereafter collectively referred to as the "Lead Plaintiffs"), by their appointed
3 Lead Counsel, bring this action on behalf of themselves and all others similarly situated, and allege
4 the following upon personal knowledge as to themselves and their own activities, and based on
5 investigation conducted by Lead Counsel for all other matters . That investigation has included the
6 thorough review and analysis of public documents, Securities and Exchange Commission ("SEC")
7 filings, press releases, news articles, the filings in the federal action entitled En Pointe Technologies,
8 Inc. andAttiazaz Din v. First Union Securities, Inc . andJSL Holdings L.P., Master Case No. 02-CV-
9 1246 L (RBB) and USA v. Amr I. Elgindy, Case. No. 02-MG-1166, Merrill Lynch Pierce Fenner &
10 Smith , Inc. v. John Laurienti, 00-CV-00781 L(POR), the filings in the California state court
11 proceedings entitled First Union Securities, Inc . v. JSL Holdings, L .P., et. al ., Case No . GIC748336,
12 Kenneth L. Fredrick v. Attiazaz Din, et al,, Case No . YC039456, and Steven and Jenifer Crosby v.
13 En Pointe Technologies, Inc., et al., No. GIC759905, and the filings in the arbitration proceeding
14 entitled Steven and Jenifer Crosby v. Hampton-Porter Investment Banking, LL C, et al., filed with
15 the National Association of Securities Dealers, and the filings in the arbitration proceeding entitled
16 First Union Securities, Inc . v. John [W.] Laurienti, et. al., NYSE Docket No . 2000-008703, and the
17 account statements of defendant John Laurienti, Charles Schwab Account No . 1587-5014, TD
18 Waterhouse Account No . 499-10030-1-5, TD Waterhouse Account No . 385-01502-1-1, Merrill
19 Lynch Priority Client Account No . 72B-13851, and First Union Account No . 5413-6986; defendant
20 JSL Holdings, LP, Merrill Lynch Priority Client Account No . 72B-07387, First Union Account No .
21 4568-6834, and TD Waterhouse Account No. 821-05908-1-9 ; and defendant Time Holdings LLC,
22 TD Waterhouse Account No . 821-03688-1-0, Charles Schwab Account No . 8838-1560, and First
23 Union Account No. 8403-8625; and interviews with and declarations from Hampton-Porter
24 Investment Bankers LLC registered representatives Adam Gilman, Jarred Kriz, and Sam Tedesco,
25 concerning the matters set forth herein .
26 INTRODUCTION AND OVERVIEW
27 1. This is a class action on behalf of Lead Plaintiffs and all others who purchased En
28 Pointe Technologies, Inc . common stock (ENPT) on the NASDAQ NMS between December 7,1999
First Amended Consolidated Class Action Complaint 1 Master Case No. 01-CV-0205 L (CGA)
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1 and April 13, 2000, inclusive (the "Class Period"), and who have suffered damages as the result of
2 the alleged price manipulation scheme set forth below. Lead Plaintiffs allege violations of the
3 federal securities laws against En Pointe Technologies, Inc . (hereinafter "En Pointe" or the
4 "Company"), Attiazaz "Bob" Din (hereinafter "Bob Din"), the co-founder of En Pointe, who has
5 served as Chairman of the Board of Directors, Chief Executive Officer and President of En Pointe,
6 and against several other co-conspirators who knowingly participated in manipulating the price of
7 En Pointe's common stock.
8 2. Throughout the Class Period, En Pointe held itself out as a national Business to
9 Business ("B2B") e-commerce provider of information technology products and value-added
10 services, using proprietary and non-proprietary software and systems to drop-ship maintenance,
11 repair, and operation ("MRO") products to its customers through an electronically linked network
12 of allied distributors in the United States .
13 3. Defendants' misconduct in connection with this fraudulent scheme and the material
14 misstatements and omissions regarding En Pointe's subsidiary, Supply Access, Inc ., enabled
15 Defendant Bob Din to sell 402,000 insider shares of En Pointe for approximately $18 million in
16 proceeds to the unsuspecting public . Defendants engaged in this illegal scheme and caused material
17 false and misleading statements to be issued in order to create high demand for En Pointe stock and
18 artificially inflate the price of En Pointe stock, thereby allowing Defendant Bob Din and other En
19 Pointe officers and directors' to sell their En Pointe shares at all-time high prices between $40 .59
20 and $51 .15 a share.
21 4. During the relevant period, Bob Din conspired with a small investment bank,
22 Hampton-Porter Investment Bankers LLC (hereinafter "Hampton-Porter"), and its brokers,
23 management, and control persons to orchestrate a price manipulation scheme that allowed Hampton-
24 Porter's brokers to receive illegal "kickback" or "concessions" incentives paid by En Pointe, receive
25 commissions on sales of En Pointe common stock for their customers accounts at artificially inflated
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27 1 Defendants Attiazaz "Bob" Din, Javed Latif, Naureen Din, ZubairAhmed, Ellis Posner, Mark Briggs,Verdell Garroutte, Jacob Stetton, Eric Keating and Robert Mercer hereinafter are collectively referred to as the
28 "Insiders" .
First Amended Consolidated Class Action Complaint 2 Master Case No . 01-CV-0205 L (CGA)
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1 prices, and sell shares of En Pointe common stock for their accounts at artificially inflated prices .
2 This scheme included Hampton-Porter's participation by: 1) parking excessive amounts of investors'
3 portfolios in En Pointe common stock; 2) refusing to execute sell orders ; 3) the use of illegal above
4 market buy-ins to dissuade potential short sellers from selling En Pointe common stock short ; and
5 4) the dissemination of materially false and misleading statements about En Pointe's ownership
6 interest in its subsidiary SupplyAccess, Inc . and its future prospects .
7 5. Hampton-Porter is a wholly owned sub-entity of H-P Holdings, LLC (hereinafter "H-
8 P"). Gregory Walker holds an ownership interest in H-P and is a control person of both entities .
9 Time Holdings, LLC, JSL Enterprises, LLC, and JSL Holdings LP, LLC are all entities controlled
10 by John William Laurienti (hereinafter "Laurienti") . Laurienti and Gregory Walker orchestrated the
11 pump and dump scheme in conjunction with Bob Din of En Pointe and used these various entities
12 as conduits for their scheme .
13 6. Laurienti was an interested owner/member o f H-P, which in turn has 100% ownership
14 interest in Hampton-Porter. Laurienti is the alter ego of Hampton-Porter and essentially directs its
15 activities . As such, Laurienti is a control person with regard to Hampton-Porter. Laurienti is a
16 recidivist stock manipulator. For example, in October of 1995, the SEC found that Laurienti failed
17 to properly discharge his supervisory duties while acting as branch manager for Dickinson & Co . and
18 in connection with an unregistered stock offering masterminded by Laurienti . As a result, Laurienti
19 was barred from acting in a proprietary or supervisory capacity with any broker dealer, municipal
20 securities dealer, investment advisor or investment company . In complete disregard of that order,
21 Laurienti has attempted to conceal his involvement with Hampton-Porter (a registered broker-dealer)
22 through his former ownership of H-P, which in turn owns 100% of Hampton-Porter . Moreover,
23 Laurienti has participated in this price manipulation scheme despite the SEC injunction barring him
24 from future violations of the securities laws .
25 JURISDICTION AND VENUE
26 7. This action arises under Sections 10(b), 20(a) and 20A ofthe Securities Exchange Act
27 of 1934, as amended (the "Exchange Act"), 15 U .S.C. §§ 78j(b), 78t(a) and 78, and SEC Rule 14b-5,
28 17 C.F.R. § 240.1Ob-5, promulgated thereunder.
First Amended Consolidated Class Action Complaint 3 Master Case No. 01-CV-0205 L (CGA)
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1 8. This Court has jurisdiction over this subject matter pursuant to 28 U .S.C. §§ 1331 and
2 1337, and Section 27 of the Exchange Act, 15 U .S .C . § 78aa .
3 9. Venue is proper in this district pursuant to Section 27 of the Exchange Act and 28
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U.S.C. § 1391(b) . Defendants Hampton-Porter Investment Bankers LLC, H-P Holdings, LLC, Time
5 Holdings, LLC, JSL Enterprises, LLC, JSL Enterprises, LLC and Laurienti are located in this
6 Judicial District, and significant sales of En Pointe securities took place in this Judicial District
7 during the Class Period .
8 10. In connection with the acts alleged in this complaint, the defendants, directly or
9 indirectly, used means and instrumentalities of interstate commerce, including but not limited to the
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mails, interstate telephone and Internet communications, and the facilities of the NASDAQ NMS .
11 PARTIES
12 11 . Plaintiff Robert Flamberg purchased a total of 26,000 shares of En Pointe
13 Technologies, Inc. common stock (ENPT) on the NASDAQ NMS during the Class Period and has
14 suffered realized and market losses of $2§5 .882 ,
15 12. Plaintiff Wilford Gentry, through Astro Corporation, purchased a total of 5,000 shares
16 of En Pointe Technologies, Inc. common stock (ENPT) on the NASDAQ NMS during the Class
17 Period and has suffered realized and market losses of 160 000.
18 13. Plaintiff Robert Mayer purchased a total of 27,700 shares of En Pointe Technologies,
19 Inc. common stock (ENPT) on the NASDAQ NMS during the Class Period and has suffered realized
20 and market losses of $88,639.
21 14. Plaintiff Dennis Pasko purchased a total of 6,400 shares of En Pointe Technologies,
22 Inc. common stock (ENPT) on the NASDAQ NMS during the Class Period and has suffered realized
23 and market losses of $189,767 .
24 15. Plaintiff Richard Tavano purchased a total of 19,506 shares of En Pointe
25 Technologies, Inc . common stock (ENPT) on the NASDAQ NMS during the Class Period and has
26 suffered realized and market losses of$496,518 .46 .
27 16. Defendant En Pointe Technologies, Inc . (hereinafter "En Pointe" or the "Company")
28 is corporation organized and existing under the laws of the State of Delaware . En Pointe's p rincipal
First Amended Consolidated Class Action Complaint 4 Master Case No, 01 -CV-0205 L (CGA)
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place of business and headquarters located at 100 N . Sepulveda Blvd., 19th Floor, El Segundo, CA
90245. En Pointe currently has 6.53 million shares outstanding .
17. Defendant Attiazaz "Bob" Din (hereinafter "Bob Din"), the co-founder of En Pointe ,
has served as Chairman of the Board of Directors, Chief Executive Officer and President of E n
Pointe. According to En Pointe's proxy statement dated February 14, 2000, Bob Din was the
beneficial owner of 653,702 shares of En Pointe . Between February 28, 2000 and March 15, 2000,
Bob Din directly and indirectly sold 402,000 shares of En Pointe for approximately $18 million in
proceeds . His sales, during the Class Period, amounted to 61 .5% of his ownership position . During
the Class Period, Bob Din made the following sales of En Pointe common stock while in possession
of material adverse information concerning the Company's business and finances as describe d
herein :
INSIDER NUMBER OF SHARES PROCEED S
Bob Din and Naureen Din 202,000 8,958,780
Mediha Dine 100,000 4,339,000
Ali Mohyuddin3 100,000 4,393,71 1
TOTAL 402,000 $17,691,49 1
18. Defendant Hampton-Porter Investment Bankers LLC (hereinafter "Hampton-Porter")
is a limited liability company organized and existing under the laws of the State of Californ ia with
its principal place of business 600 West Broadway , 14`h Floor, San Diego , Californ ia . Hampton-
Porter is an investment banking and brokerage company, and a member of the National Association
of Secu rities Dealers . Hampton-Po rter was the conduit through which the Defendants pursued their
scheme , by causing it to publish false and misleading statements regarding En Pointe, and by
otherwise manipulating the market for En Pointe stock . Specifically, Hampton-Po rter was controlled
by Defendants Laurienti, Gregory Walker and H-P .
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2 Mediha Din is the minor daughter of Bob Din and Naureen Din.
3 All Mohyuddin is the son of Bob Din and Naureen Din .
First Amended Consolidated Class Action Complaint 5 Master Case No . 01 -CV-0205 L (CGA)
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1 19. Defendant H-P Holdings, LLC (hereinafter "H-P") is a limited liability company
2 organized and existing under the laws of the State of California with its principal place of business
3 600 West Broadway, 14" Floor, San Diego, California . H-P, by and for its members, maintains a
4 100% ownership interest in Hampton-Porter.
5 20. Defendant Time Holdings, LLC (hereinafter "Time Holdings") is a limited liability
6 company organized and existing under the laws of the State of California with its principal place of
7 business 600 West Broadway, 14' Floor, San Diego, California . Time Holdings is a holding
8 company used as an alter ego for its sole members, Laurienti and Walker. Time Holdings, at the
9 time of the allegations contained herein, held approximately 522,700 shares of En Pointe (ENPT) .
10 Time Holdings also received hundreds of thousands of dollars from Hampton-Porter labeled as
11 "consulting fees." Time Holdings principle place of business is located at 600 W . Broadway, 14th
12 Floor, San Diego, CA 92101 .
13 21 . Defendant JSL Holdings LP (hereinafter "JSL Holdings") is a limited partnership
14 organized and existing under the laws of the State of California with its principal place of business
15 12626 High Bluff Drive, Suite 350, San Diego, California . Laurienti controlled JSL and maintained
16 an account at Merrill Lynch with at least 65,000 shares of En Pointe in JSL's name .
17 22. Defendant JSL Enterprises, LLC (hereinafter "JSL Enterprises") is a limited liability
18 company organized and existing under the laws of the State of California with its principal place of
19 business 12626 High Bluff Drive, Suite 350, San Diego, California. JSL Enterprises, LLC is the sole
20 general partner of JSL Holdings, LP, and is controlled by Laurienti .
21 23. Defendant John William Laurienti (hereinafter "Laurienti") resides in California
22 within this Judicial District . Laurienti was an interested owner/member of H-P, which in turn has
23 100% ownership interest in Hampton-Porter . Laurienti is the alter ego of Hampton-Porter and
24 essentially directs its activities . During the Class Period, Laurienti maintained an office at the
25 principal place of business Hampton-Porter . During the Class Period, Jarred Kriz and Sam Tedesco
26 also recall Laurienti conducting broker meetings at Hampton-Porter and working in the training room
27 of Hampton-Porter directing trades, writing out tickets, and performing trading paperwork As such,
28 Laurienti is a control person with regard to Hampton-Porter .
First Amended Consolidated Class Action Complaint 6 Master Case No. 01-CV-0205 L (CGA)
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1 24. Defendant Gregory Walker (hereinafter "Walker") holds an ownership interest in H-P,
2 which in turn has 100% ownership interest in Hampton-Porter. Walker was also the President of
3 Hampton-Porter at all relevant times . As such, Walker is a control person with regard to Hampton-
4 Porter and H-P .
5 25. During the Class Period, the defendants, individually and in concert, directly and
6 indirectly, engaged and willfully participated in a continuous course of conduct to misrepresent and
7 conceal material information regarding En Pointe's subsidiary SupplyAccess, Inc . and the scheme
8 to artificially inflate En Pointe's stock price as specified herein in order to sell at least $35 million
9 worth of En Pointe shares on the open market . Defendants employed devices, schemes, and artifices
10 to defraud, and engaged in acts, practices, and a course of conduct as herein alleged in an effort to
11 increase and maintain an artificially high market price for En Pointe shares. This included the
12 formulation of, making, and/or participation in the making of untrue statements of material facts, and
13 the omission to state material facts necessary in order to make the statements made, in light of the
14 circumstances under which they were made, not misleading, which operated as a fraud and deceit
15 upon Lead Plaintiffs and the Class .
16 CLASS ACTION ALLEGATION S
17 26. Lead Plaintiffs bring this class action under Rules 23(a) and 23(b)(3) of the Federal
18 Rules of Civil Procedure, on behalf of a class of persons who bought or otherwise acquired En
19 Pointe common stock during the Class Period (or their successors in interest) and who suffered
20 damages thereby ("the Class") . Lead Plaintiffs also allege a Third Claim for Relief on behalf of a
21 subsclass consisting of all purchasers of En Pointe stock who purchased such stock
22 contemporaneously with the Insider sales on February 28 and March 13, 2000 (the "Subclass") .
23 Excluded from the Class and Subclass are the Defendants named herein, members of the immediate
24 families of the Defendants, any firm, trust, partnership, corporation, officer, director or other
25 individual or entity in which a Defendant has a controlling interest or which is related to or affiliated
26 with any of the Defendants, and the legal representatives, heirs, successors in interest or assigns of
27 any such excluded party.
28 // /
First Amended Consolidated Class Action Complaint 7 Master Case No. 01-CV-0205 L (CGA)
1 27. The Class and Subclass are so numerous that joinder of all members is impracticable .
2 As of May 11, 2000, En Pointe had 6 .5 million shares of common stock issued and outstanding, and
3 such shares were publicly traded on the NASDAQ NMS during the Class Period, as reflected in the
4 Price and Volume History of En Pointe common stock attached hereto as Exhibit 1 . The exact
5 number of members of the Class is not known at this time, but is believed to number in the
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thousands .
7 28. Lead Plaintiffs will fairly and adequately protect the interests of the members of the
8 Class and Subclass, and Lead Plaintiffs have no interests which are contrary or in conflict with the
9 interests of the Class members that they seek to represent . Plaintiffs have retained competent
10 counsel, who has been appointed by the Court as Lead Counsel for the Class, experienced in class
11 action litigation under the federal securities laws to ensure such protection, and intends to prosecute
12 this action vigorously.
13 29. Lead Plaintiffs' claims are typical of the members of the Class and the Subclass,
14 because Lead Plaintiffs and all of the Class members sustained damages arising from the same
15 wrongful conduct complained of herein .
16 30. A class action is superior to all other available methods for the fair and efficient
17 adjudication of this controversy since joinder of all members is impracticable . Furthermore, as the
18 damages suffered by individual members of the Class may be relatively small, the expense and
19 burden of individual litigation make it impossible for the members of the Class to individually seek
20 redress for the wrongs done to them. There will be no difficulty in the management of this action
21 as a class action.
22 31, Questions of law and fact common to the members of the Class predominate over any
23 questions that may affect only individual members in that Defendants have acted on grounds
24 generally applicable to the entire Class . Among the questions of law and fact common to the Class
25 are:
26 a) whether the federal securities laws were violated by Defendants' acts as alleged
27 herein ;
28 b) whether Defendants' omitted and/or misrepresented mate rial facts and whether
First Amended Consolidated Class Action Complaint 8 Master Case No . 01-CV-0205 L (CGA)
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1 Defendants breached any duty to convey material facts or to correct material facts previously
2 disseminated ;
3 c) whether Defendants participated in and pursued the common course of conduct
4 complained of herein ;
5 d) whether Defendants acted with scienter in omitting and/or misrepresenting material
6 facts, and otherwise manipulating the market for ENPT stock ;
7 e) whether the price of En Pointe common stock was artificially inflated during the
8 Class Period as a result of the material misrepresentations and omissions complained of herein ;
9 f) whether Bob Din was a control person of En Pointe as alleged herein ; and
10 g) whether members of the Class have sustained damages and, if so, the proper measure
11 of such damages .
12 SUBSTANTIVE ALLEGATIONS
13 Background
14 32. Founded in January 1993 by defendant Bob Din and his wife, Naureen Din, En Pointe
15 is a California-based reseller of information technology products including desktop and laptop
16 computers, monitors and application software . In August 1996, En Pointe Technologies was taken
17 public by the Boston Group, a broker/dealer formerly registered with the State of California . For the
18 three years following its initial public offering ("IPO") at $8 .00/share, En Pointe stock typically
19 fluctuated in price between $4 and $10 on the NASDAQ . At the time of the IPO, defendant Bob
20 Din, his wife Naureen Din and their son and daughter, Ali Mahyuddin and Mediha Din, controlled
21 over 33% of the outstanding shares of En Pointe . By 1999, En Pointe had over 5 .9 million shares
22 outstanding, with Insiders controlling 3 .1 million shares (approximately 52%) and the public float
23 accounting for approximately 2 .8 million shares (approximately 48%) .
24 33. During 1999, companies in the B2B market started to enjoy unusual attention from
25 investors because many market research companies estimated the profit potential in this sector to
26 be enormous. For example, International Data Corporation estimated that "Internet-based
27 procurement applications will grow from $187 million in 1998 to $8 .5 billion in 2003, well on the
28 way in automating the estimated $1 .3 trillion that U.S. corporations spend on indirect purchases . "
First Amended Consolidated Class Action Complaint 9 Master Case No. 01-CV-0205 L (CGA)
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1 34. Beginning in early 1999, however, En Pointe's business had begun to deteriorate. For
2 example, while En Pointe reported net income of $0 .19, $0.04 and $0.16 per share for the first,
3 second and third quarters of Fiscal 1998, En Pointe reported a net loss of ($0 .01), ($0.76) and ($0 .16)
4 per share, for the first, second and third quarter of Fiscal 1999, respectively . By December 31, 1999,
5 sales of En Pointe had fallen by over 20%, compared to the same fiscal quarter of the prior year .
6 Thus, without price manipulation, the prospects for a rise in share price of En Pointe were bleak at
7 best.
8 35. Simultaneously, defendant Laurienti, a veteran securities manipulator, was casting
9 about for a likely target for his next pump-and dump scheme . Advised by analyst and consultant
10 Mark Bergman ("Bergman"), Laurienti's eye fell upon En Pointe. En Pointe's public float was
11 relatively small (2.8 million shares), with approximately half of the Company's shares held by
12 insiders and members of the Din family . With this small float and the attendant small trading
13 11 volume in the stock, and with management that had already demonstrated a strong interest in
14 boosting its share price through questionable means, En Pointe was a nearly ideal pump and dump
15 stock.
16 36. With shares of En Pointe trading at around $6 in early 1999 and a public float of 2 .8
17 million shares, Laurienti recognized that he had the financial capacity to purchase enough shares to
18 manipulate the price of the stock . Laurienti also realized, however, that with Insiders controlling
19 almost half of the outstanding shares of En Pointe, the market could be inundated with shares at any
20 given time, depressing the price of En Pointe shares and increasing the public float . Laurienti
21 decided to minimize this risk by enlisting the support and cooperation of En Pointe's management .
22 The Hampton-Porter/En Pointe Connectio n
23 37. Hampton-Porter's resident stock tout and Director of Research, Bergman, had a long
24 standing relationship with En Pointe's senior management, and with Defendant Bob Din in
25 particular . Bergman had been employed with the Boston Group when it took En Pointe public in
26 the August 1996 IPO, and had been responsible for stirring up investor interest in the offering .
27 38. Thereafter, from late 1997 until September 1998, Bergman worked as a consultant,
28 Director of Investor Relations, and/or Vice President with Xybernaut Corp ., a Fairfax, VA company.
First Amended Consolidated Class Action Complaint 10 Master Case No . OI-CV-0205 L (CGA)
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While Bergman working with Xybemaut, he introduced the two companies and encouraged them
to enter into a "strategic partnership" that was long on hype but short on substance . For the purposes
of generating investor interest in the two companies, Xybernaut published a press release on May
21, 1998 which stated in part:
Xybernaut Corporation (Nasdaq: XYBR), a leader in wearable computers, todayannounced that an agreement had been completed with En Pointe Technologies, Inc .(Nasdaq: ENPT), under which En Pointe will market, sell and service Xybernaut{R}products in the U .S. and Canada on a non-exclusive basis .
En Pointe is one of the nation's fastest-growing resellers of computer products andservices, directing a team of more than 475 employees from its Los Angeles,California corporate headquarters and currently generating revenues in excess of$500 million annually . With coverage in 19 cities throughout the U.S ., En Pointesales and service consultants bring customized, cost-effective computer hardware,software and service solutions to a wide range of Fortune 1000 companies, includingIBM Global Services, Northrop Grumman and Motorola, as well as state and localgovernmententities .
Dr. Mark Bergman, noted industry analyst and consultant stated: "En Pointe hasgrown rapidly by providing its customers with quality products, expertise and service .I feel that Xybernaut's hardware and software products fit perfectly into En Pointe'sbusiness model . The En Pointe sales force was introduced to Xybernaut's productslast week, and their response to the product was overwhelmingly enthusiastic . Ibelieve that the combination of Xybernaut's world-class products and En Pointe'smarketing strength will result in tremendous success for both companies . "
39. Bergman left Xybernaut in September 1998 to try his hand as a freelance stock
promoter. To this end, he founded Access 1Financial.com, "advertising" investment e-mail
newsletter service and "tout sheet" web site, and named himself the President of the company. On
the Access1 web site, Bergman hyped the stocks of companies that paid him to provide positive
coverage for them, often using the companies' own stock as consideration . En Pointe was one such
company. In fact, the financial news website www.briefing.com published an article on August 8,
2000, stating that Access 1 Financial . corn had disclosed that it was paid by subject companies for their
positive coverage, and that one such company was En Pointe. Similarly, Bloomberg News published
an article on April 28, 2000, further documenting Bergman's "analyst for hire"operation, in an article
entitled "For a Fee, Analyst Mark Bergman Will Hype Your Company's Stock" .
40. On June 23, 1999, Hampton-Porter published a press release announcing that it had
hired Bergman as its Director of research, stating :
First Amended Consolidated Class Action Complaint 1 1 Master Case No. 01 -CV-0205 L (CGA)
0 .
1 Hampton-Porter is pleased to announce the addition of Mark Bergman as Directo rof Research. Mark Bergman is one of the leading experts in the area of technology
2 enterprises and investment advice. Recently, he was Chief of Global Equities at FABCapital, and Senior Analyst at leading Investment Banking firms, such as Volpe ,
3 Hambrecht & Quist, Cruttenden Roth . In addition, he was Director of Research forthe Boston Group . He has founded leading technology growth firms and was recently
4 Senior Vice-President of Xybernaut Corporation -- the worldwide leader in wearablecomputers. Dr. Bergman received a Ph .D. from Northwestern University and
5 completed post-doctorate work at the University of Illinois.
6 41 . Because he had longstanding contacts with the Insiders and with Defendant Bob Din
7 in particular, and because he had already been compensated by En Pointe and the Insiders to tout En
8 Pointe's stock on the Access I Financial web site, Bergman was in an ideal position to recruit Bob
9 Din and the Insiders to participate in Laurienti's pump and dump scheme .
10 Defendants Prepare Their Fraudulent Schem e
11 42. On or about September 1, 1999, Defendants began preparing to artificially inflate En
12 Pointe's stock price to enable Defendants to pocket millions in unlawful insider trading proceeds .
13 To this end, Laurienti assembled a team of his associates to join him at Hampton-Porter, a penny
14 stock brokerage firm in which he had a 40% ownership interest . Although Laurienti had been barred
15 by the SEC in 1993 from acting in a supervisory capacity with any broker dealer or investment
16 company, Laurienti was able to operate this boiler room outfit through Walker, the President of
17 Hampton-Porter. Launenti also ensured his control of Hampton-Porter by installing his trusted
18 friend, James Green, as the branch manager and hiring his brother, Bryan Laurienti, to join as a
19 broker .
20 43. Laurienti approached Bob Din about their plan to accumulate shares of En Pointe and
21 to assume command of the company's public float . Laurienti convinced Bob Din that his plan would
22 be a mutually beneficial one . With control over a significant portion of the public float, Laurienti
23 would essentially act as a price support for the stock while Bob Din could act in a similar capacity
24 by controlling the sale of shares by Insiders . Under this arrangement, defendants would profit
25 handsomely from the rise in price and could coordinate their selling of shares to optimize their
26 returns.
27 44. Laurienti offered to purchase a large stake in En Pointe and promote its stock in
28 exchange for Bob Din's assurance that Insiders would not flood the market with stock . In return,
First Amended Consolidated Class Action Complaint 12 Master Case No. 01-CV-0205 L (CGA)
L J
I Bob Din agreed to limit insider sales to 125,000 shares for a period of time during the first quarter
2 of 2000. Additionally, Bob Din and En Pointe would need to fund payments or "concessions" to
3 Hampton-Porter registered representatives for pushing En Pointe shares on their clients . Realizing
4 that Laurienti's proposal could potentially mean a huge boost to En Pointe stock (of which the Bob
5 Din alone owned over 1 million shares), Bob Din agreed to participate in the fraudulent conspiracy .
6 45. Specifically, Bob Din agreed to regulate all Insider sales by En Pointe's officers and
7 directors to ensure that the market would not be inundated with a large number of En Pointe shares
8 at any given time and provide the illicit financial inducements to Hampton-Porter brokers in
9 exchange for their assistance with the "pump" of the stock. In return, Laurienti agreed to cause
10 Hampton-Porter to issue falsely positive analyst reports about En Pointe's business prospects, and
11 to instruct Hampton-Porter's brokers to sell En Pointe securities to unsuspecting clients and
12 members of the Class. In addition, En Pointe would pay illegal "kickbacks" or "concessions" to
13 Hampton-Porter and its brokers, in which Walker and Laurienti were direct beneficiaries . The
14 "kickback" or "concessions" paid to Hampton-Porter from En Pointe amounted to illicit payments
15 of 5% to 20% per share, over and above the broker's regular commission for their sales of En Pointe
16 securities.
17 46. With the fraudulent scheme firmly established and investor interest beginning to
18 surface as a result of increasing trading volumes, defendants began to aggressively promote En
19 Pointe shares. Pursuant to their agreement, Sam Tedesco and Jarred Kriz recall Bob Din opening
20 an En Pointe account at Hampton-Porter and depositing $250,000 to $1 million during the Class
21 Period. The En Pointe account was used to pay conessions for the sale of En Pointe stock . In
22 furtherance of the fraudulent scheme, Bob Din, Laurienti and Walker held at least 2 meetings during
23 the Class Period to instruct Hampton-Porter registered representatives how to sell En Pointe stock
24 on or about December 8, 1999 and December 15, 1999 . During these meetings, Bob Din, Laurienti
25 and Walker would instruct the brokers on ways to entice clients to invest in the Company and to
26 convince those clients to hold their shares . Laurienti and James Green informed the brokers that
27 Hampton-Porter would pay a "concession" of 5% to 20% per share, over and above the broker's
28 regular commission, for all sales of En Pointe shares . Adam Gilman, Jarred Kriz, and Sam Tedesco
First Amended Consolidated Class Action Complaint 13 Master Case No . 01-CV-0205 L (CGA)
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1 were told that a credited concession would be deducted from the brokers paychecks, however , if their
2 clients sold the stock within a certain period of time . Sam Tedesco and Jarred Kriz also recall
3 Laurienti and Walker pressuring Hampton -Porter registered representatives to sell En Pointe stock
4 to their customers without regard to their customers ' suitability .
5 47. Laurienti 's efforts at Hampton-Porter mirrored his previous a ttempts at such boiler
6 room tactics while employed at Dickinson & Co. In 1993, in fact, Lau rienti had been barred by the
7 SEC from acting in a supe rv isory capacity with any brokerage firm for permitting kick -backs of cash
8 and securities to his brokers for selling a stock called Fairmont Resources, Inc., a Canadian penny
9 stock.
10 48. While all of these elements of the scheme were falling into place, Lau rienti began
11 quietly acquiring shares of En Pointe for his own account and through his various alter egos, Time
12 Holdings, LLC, JSL Enterp rises , LLC, and JSL Holdings , LP, in order to gain control of the public
13 float of En Pointe . Time Holdings alone acquired 522,700 shares of En Pointe from August to
14 December of 1999 . This holding alone amounted to an 8 .8% stake in En Pointe, just below the 10%
15 insider threshold. Not only did Laurienti ultimately acquire these shares but he and Walker also
16 consistently bought and sold the stock in the accounts of Time Holdings , LLC, JSL Enterprises,
17 LLC, and JSL Holdings , LP, as well as their personal accounts , to create the appearance of active
18 trading and interest in the stock , some ofwhich were reflected in Schedule 13D/A of Time Holdings,
19 LLC, dated November 2, 1999 . Such purchases were financed , in part, through the utilization of
20 cash transfers reflected in the Cash Transaction Spreadsheet a ttached hereto as Exhibit 2 . In
21 addition , Lau rienti and Walker bought additional shares of En Pointe through several personal
22 accounts , including but not limited to, Laurienti ' s Charles Schwab Account No . 1587-5014, TD
23 Waterhouse Account No. 499-10030 -1-5, TD Waterhouse Account No. 385-01502 - 1-1, Merrill
24 Lynch Priority Client Account No . 72B-13851 , and First Union Account No . 5413 -6986; JSL
25 Holdings 's Merrill Lynch Prio rity Client Account No. 72B-07387, First Union Account No . 4568-
26 6834 , and TD Waterhouse Account No . 821-05908 -1-9, and Time Holdings' TD Waterhouse
27 Account No. 821-0368 8-1 -0, Charles Schwab Account No . 8838-1560 , and First Union Account No .
28 8403-8625 , through the utilization of cash transfers as reflected in the Cash Tr ansaction Spreadsheet
First Amended Consolidated Class Action Complaint 14 Master Case No . 01-CV-0205 L (CGA)
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1 attached hereto as Exhibit 2 . By early December 1999, Laurienti had purchased 520,000 shares of
2 En Pointe for his personal accounts . In the aggregate, through his personal account, the accounts of
3 affiliated entities, and Hampton-Porter's clientele, Laurienti controlled as much as 2 million shares
4 of En Pointe stock .
5 49. While Hampton-Porter's brokers aggressively pushed their clients to invest in En
6 Pointe securities, and with no other investment analysts reporting on En Pointe securities, En Pointe
7 and Hampton-Porter seized the opportunity to "pump" the stock by issuing false and misleading
8 public statements . To this end, Sam Tedesco recalls that Todd Picture began preparing and drafting
9 promotional "analyst reports" to be published concurrently with "buy" recommendations from
10 Hampton-Porter .
I 1 50. With this boiler room operation ready to commence, Hampton-Porter brokers began
12 a vigorous campaign to induce their clients to invest in En Pointe . If clients did not buckle under
13 the weight of the high-pressure sales pitch, the brokers would simply engage in unauthorized trading
14 of En Pointe in their client's accounts . Sam Tedesco recalls that any complaints by the clients would
15 be met with a cancel and rebill of the transaction to another unsuspecting client's account effectively
16 creating the perception of even greater trade activity in En Pointe . Sam Tedesco recalls that any
17 efforts by investors to sell their shares during this time were essentially blocked by Hampton-Porter
18 trading floor, acting at the direction of Laurienti and Walker .
19 Laurienti's First Union Securities, Inc . Account
20 51. Having amassed an enormous position in En Pointe at a number of discount brokerage
21- firms, Laurienti contacted William A . King ("King"), Senior Vice President and Director of
22 Corporate Executive Services of First Union Securities, Inc . ("First Union") in its Newport Beach
23 Office to inquire about First Union's margin requirements in late 1999. King informed Laurienti that 1
24 First Union would allow him to borrow against 50% of his total portfolio .
25 52. In or about January 2000, Laurienti opened an individual account in his name at First
26 Union ("the Personal Account") with King acting as the registered representative for the account .
27 Laurienti executed the requisite margin documents to allow him to take advantage of First Union's
28 margin requirements . Upon the opening of the Personal Account, Laurienti initially transferred i n
First Amended Consolidated Class Action Complaint 15 Master Case No . 01-CV-0205 L (CGA)
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1 350,000 shares of En Pointe.
2 53. Recognizing his potential for liability for the inevitable debit balance that would
3 occur when En Pointe shares returned to their true market value, Laurienti asked King to open a
4 separate account at First Union on behalf of JSL Holding ("the Partnership Account") . King knew
5 that such a request would be met with resistance and suspicion by First Union . To coax First Union
6 into allowing such an account, Laurienti represented the JSL Holdings was being formed for "estate
7 planning purposes". Laurienti submitted the Partnership Account opening documents listing JSL
8 Enterprises, L.L.C. as the general partner of JSL Holding . This application was rejected by First
9 Union. Laurienti then resubmitted the opening documents with JSL Holdings, L .P. as the general
10 partner. This too was rejected by First Union .
11 54. Finally, Laurienti represented to First Union that he was now the General Partner of
12 JSL Holdings and would assume full responsibility for all debit balances arising from the account .
13 Laurienti, consistent with this charade, signed and executed the opening account documents on
14 behalf of JSL Holdings as its general partner. In truth and in fact, JSL Enterprises, Inc ., a
15 corporation with no assets, is the sole General Partner of JSL Holdings. Laurienti made these
16 misrepresentations to dupe First Union into allowing him to transfer his En Pointe shares to an
17 account that would essentially shield Laurienti from the certain debit balance that would allow En
18 Pointe's plunge . On January 31, 2000, an account was opened for JSL Holdings at First Union .
19 55. Having set up his dummy account, Laurienti directed the transfer of all of his
20 positions from his Personal Account, including the 350,000 shares of En Pointe, and an existing
21 debit balances of approximately $6 .2 million to the Partnership Account on or about February 10,
22 2000. An additionally 180,555 shares of En Pointe would be transferred into his account on March
23 7, 2000 from a non-party brokerage firm . As the value of this stock rose in February and early
24 March, the equity in Laurienti's First Union account increased dramatically . In furtherance of his
25 scheme, Laurienti periodically made withdrawals on the equity essentially borrowed from First
26 Union and transferred those amounts to various accounts ensuring that he would stand to profit
27 millions when the bottom fell out of the price of En Pointe shares . In February and March 2000
28 alone, Laurienti transferred over 2.2 million from his First Union account to other accounts of
First Amended Consolidated Class Action Complaint 16 Master Case No. 01-CV-0 205 L (CGA)
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11 unknown origin .
Defendants Begin the Manipulation
56. On or about December 7,1999, several En Pointe officers participated in a conferenc e
11 call with business journalists, analysts and investors . Specifically, three En Pointe executives (Bob
1 Din, Latif, and Posner) part icipated in this conference call . During the call, Bob Din commented o n
En Pointe' s new "wholly owned" subsidiary SupplyAccess . Bob Din further stated :
We have recently launched a new subsidiary, SupplyAccess, Inc ., which is beingpositioned to compete well against entities such as Ariba and Commerce One . Weare in the process of seeking a private placement of securities for no less than $9 .75Mand no more than $18 .75M .
57. Ariba and Commerce One were and are the two leading companies in the B2 B
exchange market and experienced strong demand for their stock in 1999 . Bob Din, in the December
7, 1999 conference call, characterized En Pointe's subsidiary SupplyAccess as "being positioned to
compete well against" both Ariba and Commerce One, the dominant companies in the B2B
marketplace. This statement was patently false . In fact, neither En Pointe nor SupplyAccess have
ever been significant players in the B2B market in which Ariba and Commerce One operate, and they
were not positioned to offer any significant competition to those companies .
58. B2B industry reports confirm that SupplyAccess and En Pointe were not eve n
remotely involved as players in the B2B marketplace . Specifically, in January 2000 , Broadview
International , LLC released a research repo rt entitled "Market Maps of B2B Digital Marketplaces
and Web -Enabled Supply Demand M anagement Companies ." Broadview 's repo rt sought to account
for every known public and private company operating in the B2B market . Additionally, Broadview
catego rized each comp any into market segments identifying the focus of the B2B companies . Ariba
and Commerce One were characte rized as "Super Ve rticals" as opposed to just horizontal or vertical
market B2B companies . This characterization of Ariba and Commerce One reflected their
domination of the B2B space. Most importantly, neither En Pointe nor SupplyAccess were
mentioned as operating in any B2B market whatsoever -- in fact they were not even mentioned in
the repo rt .
11 1
First Amended Consolidated Class Action Complaint 17 Master Case No . 01-CV-0205 L (CGA)
S
1 59. A March 13, 2000 press release published by Commerce One, Inc . further
2 demonstrates the fact that En Pointe and SupplyAccess were not and never have been competitors
3 of Commerce One . This press release lists En Pointe as one of over 30 "vendors and suppliers" who
4 had "endorsed Commerce One's Round Trip capability ." This statement makes it clear that En
5 Pointe was a purchaser of Commerce One's technology, rather than a competitor in the B2B market .
6 60. During the December 7, 1999 conference call, defendant Bob Din also announced that
7 the private placement offering of SupplyAccess would garner a total of "no less than $9 .75 million
8 and no more than 18 .75 million." The maximum offering of $18 .75 million would have left En
9 Pointe with a majority interest in SupplyAccess .
10 61. This statement was knowingly misleading because Bob Din, in light of his position
11 11 and access to internal private placement memoranda for SupplyAccess, En Pointe would complete
12 on April 4, 2000 a supplemental private placement offering which would reduce the Company's
13 ownership in SupplyAccess to a minority position (below 50%) to 45 .1% .
14 62. That same day, December 7, 2000, defendants formally informed the market
15 concerning the Company's planned private placement of SupplyAccess stock with the filing of a
16 Form 8-K with the SEC . This document stated, in relevant part :
17 The Company is in the process of seeking funding for a private placement ofsecurities in its recently incorporated, currently wholly owned, direct-procurement
18 focused subsidiary, SupplyAccess, Inc., for no less than $9 .75 million and no more11 than $18 .75 million .
1963 . After the early December conference call and 8-K filing, the share price of En Pointe
20began to steadily rise as Hampton-Porter created artificial demand for the stock and as the market
21digested the news that En Pointe was purportedly a majority owner of SupplyAccess, a company that
22was "well positioned" to compete with Wall Street darlings Ariba and Commerce One . In early
23December, En Pointe stock traded around $10 per share and an average volume of about 30 to 50
24thousand shares a day. In fact, En Pointe stock had never traded above $14 a share during the prior
25two years. By December 31, 1999, En Pointe closed at $27 .50 per share .
2664. During the Class Period Adam Gilman, Jarred Kriz, and Sam Tedesco were employed
27as Account Executive at the defendant brokerage firm of Hampton-Porter . During his employment
28
First Amended Consolidated Class Action Complaint 18 Master Case No. 01 -CV-0205 L (CGA)
F9L_ -A
1 at Hampton-Porter, Sam Tedesco also designed and managed Hampton-Porter's Intranet and Internet
2 computer systems and connections . As a result, Sam Tedesco had access to and exercised control
3 over all information maintained on Hampton-Porter's computer systems . Sam Tedesco also acted
4 as the interim compliance officer at Hampton-Porter during April, 2000 .
5 65. During the December 8,1999 and December 15,1999 broker meetings, Laurienti and
6 James Green caused Hampton-Porter to offer to pay Sam Tedesco and Jarred Kriz, and every other
7 Hampton-Porter broker, an incentive award for the sale of En Pointe stock during the Class Period .
8 Dave Adams, Adam Gilman, Jarred Kriz, Bryan Laurienti, Drew Louis, Sid Merelo, David
9 Montesano, and Sam Tedesco received incentive payments in the amount of 5% to 20% for the sale
10 of purchase price of En Pointe stock. These incentive payments were not disclosed to Hampton-
11 Porter clients or the public and were known to Bob Din. Sam Tedesco and Jarred Kriz were told that
12 incentives would be taken away if En Pointe stock was sold prior to both Laurienti's and James
13 Green's prior approval, i.e . in order to receive the incentive payments, the En Pointe stock purchased
14 during the Class Period had to held by Hampton-Porter clients until further approval from both
15 Laurienti and James Green or the incentives payments would have to be repaid .
16 66. Thereafter, throughout the Class Period, Laurienti and James Green held daily broker
17 meetings were they would explain the goals of the day, i .e. which stocks needed to rise or fall, by
18 how much, and changes to percentage of the sales price sales of En Pointe stock would be paid as
19 incentive payment .
20 67. Sam Tedesco and Jarred Kriz recall how Laurienti and James Green caused Hampton-
21 Porter to organize and prioritize entry of sales orders match quoted prices and lots with
22 corresponding buy orders for En Pointe stock . Hampton-Porter's manipulation ofpurchase and sales
23 was accomplished through the sophisticated use of the NASDAQ Level II quote system, which
24 allows traders to see market maker activity in real time . Hampton-Porter's matching of sales orders
25 match quoted prices and lots with corresponding buy orders would cause the price of En Pointe stock
26 to rise. Sam Tedesco also recalls that on one occasion during the Class Period, a Hampton-Porter
27 client wanted to sell a large block of stock, and Hampton-Porter, using these techniques, caused the
28 price of En Pointe stock to move down to discourage the client from selling below his limit sale s
First Amended Consolidated Class Action Complaint 19 Master Case No. 4l-CV-0205 L (CGA)
1 price.
2 68. Sam Tedesco and Jarred Kriz recall that Hampton-Porter was coordinating the
3 purchase of En Pointe stock with funds from En Pointe's Hampton-Porter account, in which $1
4 million was deposited and over 300,000 shares were purchased in order to support the stock price .
5 Hampton-Porter broker, Troy Peters, and James Green managed the En Pointe account . Sam
6 Tedesco recalls that Hampton-Porter had a letter authorizing purchases of En Pointe stock at or about
7 $12 per share . Sam Tedesco was present during a December, 1999 telephone call between Troy
8 Peters and Bob Din during which Troy Peters asked Bob Din to clarify whether authorization was
9 for $12 or $12.99 per share.
10 69. Sam Tedesco and Jarred Kriz recall that Bob Din spoke at Hampton-Porter broker
11 meeting held at Hampton-Porter on or about December 8, 1999 and December 15, 1999, during
12 market hours . During these two broker meetings, Sam Tedesco and Jarred Kriz recall that Bob Din
13 told Hampton-Porter brokers to compare En Pointe with Ariba and Commerce One , not only in
14 company structure and but also for potential stock price. Specifically, Bob Din told them that
15 because the En Pointe's true strategic value was in its Internet-related subsidiaries, Firstsource .com
16 and SupplyAccess Inc., they should tell their clients that En Pointe was comparable to
17 CommerceOne, Ariba and PurchasePro, whose stock price was considerably higher . Bob Din also
18 told them to tell their clients that SupplyAccess Inc . was already generating substantial revenues
19 from the reselling of computers . Bob Din also instructed them to tell their clients that En Pointe is
20 in the process of issuing a private placement for SupplyAccess, raising $18 million, and that upon
21 completion, En Pointe will retain a 51 % stake in SupplyAccess . Bob Din explained that the $18
22 million private placement would bring an additional $35 to $40 in of value to En Pointe's market
23 capitalization to En Pointe's stock based upon trading at 60 times En Pointe's year 2000 revenues .
24 Sam Tedesco and Jarred Kriz recall that analyst Todd Picture was in attendance at the December 8,
25 1999 and December 15, 1999 broker meetings when Bob Din spoke .
26 70. The Bob Din's statements at the December 8, 1999 and December 15, 1999 broker
27 meetings were materially false and misleading at the time that they were published because : a)
28 SupplyAccess was not a direct competitor of either CommerceOne, Ariba or PurchasePro and has
First Amended Consolidated Class Action Complaint 20 Master Case No . 01-CV -0 205 L (CGA)
. .
1 never been; b) Defendants concealed and affirmatively misrepresented the fact that En Pointe would
2 complete on April 4, 2000 a supplemental offering of SupplyAccess preferred stock which would
3 reduce En Pointe's ownership below that of a majority position (below 50%) to 45 .1 %; c) the reports
4 concealed the fact that Defendants were engaged in a scheme to artificially inflate En Pointe's share
5 price so that Defendants could sell En Pointe stock to the unsuspecting public for massive illegal
6 profits, and that Hampton-Porter and En Pointe were paying Hampton-Porter's sales representatives
7 special incentive payments for sales of En Pointe stock ; d) the reports concealed the fact that control
8 persons of Hampton-Porter owned extremely large stakes in En Pointe stock and were causing
9 Hampton-Porter to advise its customers to buy the stock in order to enrich themselves ; and e)
10 SupplyAccess was a new start up with an unproven technology of questionable value, and there was
11 no reasonable basis for the statement that SupplyAccess was generating substantial revenues from
12 the reselling of computers in its first year of operations .
13 71. Sam Tedesco and Jarred Kriz recall seeing Bob Din in Hampton-Porter offices during
14 the period of December 28,1999 through January 4, 2000 meeting with Laurienti, Walker and James
15 Green. Sam Tedesco also recalls seeing Bob Din and Laurienti meeting separately in Hampton-
16 Porter offices during the period of December 28, 1999 through January 4, 2000. Sam Tedesco also
17 recalls attending meetings during the Class Period with Laurienti, Walker and/or James Green when
18 Bob Din was on the speaker phone during which Hampton-Porter customer's purchases and sales
19 of En Pointe stock.
20 72. Sam Tedesco and Jarred Kriz recall that on or about December 30, 1999, January 31,
21 2000, February 29, 2000, and March 31, 2000, James Green would call brokers into his office to
22 discuss commissions and incentive payments . James Green would calculate the amount of incentive
23 payments for the sale of En Pointe stock and write it on a payroll sheet, which was sent to Regina
24 Horn in Hampton-Porter's personnel department . Incentive payments were sometimes paid from
25 the personal checking account of Walker, as reflected in the Cash Transaction Spreadsheet attached
26 hereto as Exhibit 2 .
27 73. On January 13, 2000, En Pointe filed its annual report on SEC Form 10-K. This
28 document stated, in relevant part :
First Amended Consolidated Class Action Complaint 21 Master Case No, 01-CV-0205 L (CGA)
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1 The Company has recently formed a new subsidiary, SupplyAccess, Inc ., to continuethe maintenance and enhancement of these systems, and to offer some of the benefits
2 of these systems to third parties. A private placement of the capital stock of thi ssubsidiary is currently in process ; there can be no assurance, however, that the private
3 placement will be successfully completed .
4 74. The quoted statements in the January 13, 2000 Form 10-K were materially false and
5 misleading at the time that they were made, in that Defendants concealed the fact that En Pointe
6 would complete on April 4, 2000 a supplemental private placement offering which would reduce the
7 Company's ownership in SupplyAccess to a minority position (below 50%) to 45 .1% .
8 75. Throughout the Class Period, Bob Din, Laurienti, Walker and H-P and caused
9 Hampton-Porter to consistently advocate the "hidden value" of SupplyAccess to En Pointe's stock
10 price- Sam Tedesco recalls that Hampton-Porter published glowing "analyst reports" were drafted
11 and prepared by Todd Picture, who had received his information from Bob Din at December 8, 1999
12 and December 15, broker meetings . These "analyst reports" were designed to artificially inflate
13 the share price of En Pointe stock and work in tandem with the artificial demand for the stock that
14 Hampton-Porter's boiler room operation was creating . For example, in a research report published
15 January 11, 2000, Hampton-Porter stated ;
16 We rate ENPT Accumulate, Speculative . While En Pointe Technologies' stock pricehas run more than 280% in the past two weeks and the valuation does appear lofty
17 on a near term basis, we believe that the current price of the stock reflects a fe wcritical metrics that should sustain an increase in valuation over the mid to longer
18 term.
19 ****
20 [W]e believe the company's true strategic value is in its Internet-relatedsubsidiaries, Firstsource.com and SupplyAccess Inc., and that the recent runup in
21 terms of stock price is due to market speculation in terms of these businesses . EnPointe currently holds a 71 % stake in Firstsource and a 51 % stake in SupplyAccess
22 (upon completion of an $18 million private placement) . As each of these companie sramp in terms of revenue and capturing market share, we believe that they represent
23 a significant value to En Pointe shares . Moreover, an IPO of SupplyAccess couldunleash enormous additional value to En Point shareholders, given a conservative
24 valuation relative to its peers on the street (see discussion below) . At present, we feelthat En Point represents a compelling indirect play in the business -to-business
25 eCommerce market.
26 ****
27 SupplyAccess Inc. focuses on large enterprise e-procurement solutions in thebusiness-to-business marketplace, including procurement of IT products and services ,
28 operating resources and other vertical products and services. Strategic partners
First Amended Consolidated Class Action Complaint 22 Master Case No, 01-CV-0205 L (CGA)
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1 include SAP AG (NYSE : SAP) and Microsoft Corp . (Nasdaq : MSFT) . In its first twoquarters of operation, the company has already processed more than $100 million in
2 transactions .
3 Growth in the business-to-business Internet commerce market continues to explode,and is affecting the way small businesses to large corporations are doing business .
4 Business-to-business eCommerce enables companies to drastically reduce costs ,increase and sustain ROI and gain competitive advantages over their peers .
5 According to Giga Information Group, savings due to the use of business-to-businesseCommerce solutions for US businesses will explode from $15 billion in 1998 to
6 about $600 billion in 2002 . Moreover, one-fourth of all US business-to-businesspurchasing will be done online by 2003, reaching approximately $2 .8 trillion in
7 transaction value, according to the Boston Consulting Group .We believe that SupplyAccess is poised to take advantage of this exponentially
8 growing business-to-business eCommerce market, differentiating itself from itscompetitors such as CommerceOne, Ariba and PurchasePro on a number of
9 different levels .
****10 11
11 [W]e believe that SupplyAccess has a significant opportunity in the huge B2Bmarket, and therefore makes a compelling value proposition for shareholders of En
12 Pointe. En Pointe is in theprocess of issuing a private placement for SupplyAccess,raising $18 million . Upon completion, En Pointe will retain a 51 % stake in
13 SupplyAccess . Given the street's interest in e-procurement companies andSupplyAccess' competitive positioning in this space, a SupplyAccess IPO would
14 bring substantial value to En Pointe . (Emphases added.)
15 76. Through Hampton-Porter, Bob Din, Laurienti, Walker and H-P continued to feed
16 similar false and misleading information to the market on February 4, 2000, when Hampton-Porter
17 published another Todd Picture report containing the following statements :
18 To reiterate, we believe that SupplyAccess has a significant opportunity in the hugeB2B market, and therefore makes a compelling value proposition for shareholders
19 of En Pointe . En Pointe is in the process of issuing a private placement forSupplyAccess, raising $18 million. Upon completion, En Pointe will retain a 51%
20 stake in SupplyAccess . Given the street's interest in e-procurement companies andSupplyAccess' competitive positioning in this space, a SupplyAccess IPO would
21 bring substantial value to En Pointe . (Emphases added .)
22 77. The January 11, 2000 and February 4, 2000 reports compared SupplyAccess to Ariba
23 and Commerce One on a market capitalization basis . For example, in the February 4, 2000
24 report,Bob Din, Laurienti, Walker and H-P cause Hampton-Porter to state :
25 Company Recent Stock Price Market Capitalization :Ariba- $172 15,629,640
26 Commerce One- $214 15,470,362Purchase Pro- $119 3,358,741
27 En Pointe- $38 227,000
28 Assuming that SupplyAccess is valued at a conservative multiple of 60X year '0 0
First Amended Consolidated Class Action Complaint 23 Master Case No . 01-CV-0205 L (CGA)
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1 revenues to its peers, (CMRC @ 123x year '00 ; and ARBA @ 80x year '00), withprojected revenue of $7,591,000 in its first year of operations, SupplyAccess should
2 be valued at approximately $17 per share (28,000,000 basic outstanding) . An initialpublic offering of SupplyAccess would unleash value to En Pointe in the following
3 manner: Upon completion of an $18 million private placement, En Pointe wouldown 51 % of SupplyAccess (which should be valued at approx . $17 per share) . This
4 would in turn, bring an additional $40 to En Pointe's current $38 .25 trading level .We believe that trading 60x `00 revenues, an 1PO of SupplyAccess would bring
5 somewhere between $35 and $40 of value to En Pointe's market capitalization .
6 79_ The quoted statements in the January 11, 2000 and February 4, 2000 reports were
7 materially false and misleading at the time that they were published because : a) SupplyAccess was
8 not a direct competitor of either Commerce One or Ariba and has never been ; b) Defendants
9 concealed and affirmatively misrepresented the fact that En Pointe would complete on April 4, 2000
10 a supplemental offering of SupplyAccess preferred stock which would reduce En Pointe's ownership
11 below that of a majority position (below 50%) to 45.1% ; c) the reports concealed the fact that
12 Defendants were engaged in a scheme to artificially inflate En Pointe's share price so that Defendants
13 could sell En Pointe stock to the unsuspecting public for massive illegal profits, and that Hampton-
14 Porter and En Pointe were paying Hampton-Porter's sales representatives special incentive payments
15 for sales of En Pointe stock ; d) the reports concealed the fact that control persons of Hampton-Porter
16 owned extremely large stakes in En Pointe stock and were causing Hampton-Porter to advise its
17 customers to buy the stock in order to enrich themselves ; and e) SupplyAccess was a new start up
18 with an unproven technology of questionable value, and there was no reasonable basis for the
19 projection that SupplyAccess would generate $7 .5 million in revenues in its first year of operations .
20 80. The fact that the SupplyAccess revenue projections contained in the January 11, 2000
21 and February 2000 reports set forth above were materially false and misleading when made is further
22 demonstrated in the Company's subsequent filings. Because En Pointe's voting interest in
23 SupplyAccess dropped below 50% to 45 .1% effective April 4, 2000 and En Pointe did not otherwise
24 have control, En Pointe began to account for its investment in SupplyAccess under the equity method
25 of accounting . Under this method of accounting, En Pointe recognized a loss of $512,000 on its
26 minority stake for the fiscal year ended September 30, 2000 . No significant revenues from
27 SupplyAccess were reported or evident. In fact, according to En Pointe's annual report on SEC Form
28 10-K, filed on January 18, 2001, "SupplyAccess, a start-up internet portal business-to-business
First Amended Consolidated Class Action Complaint 24 Master Case No . 01-CV-0 205 L (CGA)
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1 provider, did not record any net sales for the approximate six month period in which the former
2 subsidiary was consolidated with the Company ."
3 81. During the period of December 28,1999 through January 4, 2000, Bob Din endorsed
4 or approved the January 11, 2000 and February 4, 2000 reports prior to their publication in his
5 telephone conversations concerning the contents of the reports with Laurienti, Walker and/or James
6 Green at which Sam Tedesco was present .
7 82. On February 10, 2000, En Pointe and Bob Din published a press release which stated,
8 in relevant part :
9 With the new business systems now operational, En Pointe is at the forefront ofbusiness-to-business e-commerce utilizing its unique tool, SupplyAccess(TM) . . . .
10****
11The Company is in the process of obtaining funding for a private placement of
12 securities in its subsidiary, SupplyAccess, Inc .
13 83. En Pointe's and Bob Din's statements in the February 10, 2000 press release were
14 materially false and misleading at the time that they were published, in that they concealed the facts
15 that: a) neither the Company nor SupplyAccess was an active competitor in the business-to-business
16 e-commerce marketplace, and in fact neither was considered to be a player in this market ; and b)
17 contrary to prior statements, En Pointe would complete on April 4, 2000 a supplemental private
18 placement offering which would reduce the Company's ownership in SupplyAccess to a minority
19 position (below 50%) to 45 .1%.
20 84. On February 25, 2000, En Pointe and Bob Din made another announcement
21 concerning their planned private placement of SupplyAccess equity, stating that "its subsidiary,
22 SupplyAccess, Inc., has completed a first closing of a $26 .5 million investment in
23 SupplyAccess(TM) Series A Preferred Stock ." This statement was materially false and misleading
24 at the time that it was made, because it failed to disclose, and En Pointe and Bob Din concealed the
25 fact that En Pointe would complete on April 4, 2000 a supplemental private placement offering
26 which would reduce the Company's ownership in SupplyAccess to a minority position (below 50%)
27 to 45.1 % .
28 l/ I
First Amended Consolidated Class Action Complaint 25 Master Case No . 01-CV-0205 L (CGA)
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85. On February 25, 2000, En Pointe's common stock reached an all-time high of $5 2
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per share . In an effort to capitalize on the stock's all-time and the undisclosed knowledge of the
impending sale of En Pointe's controlling interest in SupplyAccess, Bob Din and the Insiders sold
141,922 shares worth approximately $7.4 million worth of their stock on February 28, 2000 and
February 29, 2000 .
86. After En Pointe stock began trading above $50 per share, Laurienti and James Gree n
reprimanded Sam Tedesco and Jarred Kriz for placing sell orders on En Pointe stock for their clients .
Sam Tedesco and Jarred Kriz recall that their clients would call in, request a sell order, which they
would honor by executing a sell ticket . Upon receipt of such sell orders, Laurienti and James Green
would become openly enraged, rip up the sell tickets and refuse to execute sell orders for Sam
Tedesco's and Jarred Kriz's Hampton-Porter clients .
87. On March 2, 2000, En Pointe filed a report on Form 8-K with the SEC, stating in part :
The Company announces that its web procurement business-to-business subsidiary,SupplyAccess, Inc., recently completed an initial funding of a private placement ofSeries A preferred stock in the gross amount of $18 million . Such funding resultedin the sale of 12 million shares of preferred stock at $1 .50 per share, representing46.1% of the total 26 million shares of outstanding stock . With the conclusion of thissale, the Company's ownership in SupplyAccess, Inc . is 53.9%.
88. The quoted statements in the March 2, 2000 Form 8-K were materially false an d
misleading at the time that they were made, in that En Pointe and Bob Din concealed the fact tha t
En Pointe would complete on April 4, 2000 a supplemental private placement offering which woul d
reduce the Company's ownership in SupplyAccess to a minority position (below 50%) to 45.1 %.
89. After the release of the En Pointe Form 8K, from March 2, 2000 through March 15 ,
2000, the Insiders sold an additional 556,095 shares of En Pointe stock worth approximately $27 .6
million. Despite this flood of Insider sales, Laurienti had been able to stabilize the price of the stock
by continuing his promotional efforts and encouraging clients of Hampton-Porter to buy En Pointe
shares . Laurienti's success in this regard was temporary, however .
90. Known only to En Pointe and Bob Din and unknown to the Class, as reflected in En
Pointe's Form 10K for fiscal year ending September 30, 2000, "on April 4, 2000, SupplyAccess
completed a supplemental private placement of stock of 5,088,318 shares of convertible preferre d
First Amended Consolidated Class Action Complaint 26 Master Case No. 01-CV-0205 L (CGA)
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stock at $1 .50 a share that reduced the Company's voting interest to 45 .10% . "
91 . Also on April 4, 2000 , as news ofthe Insider sales were released , a share price decline
was significant enough to trigger a $1,370,300 margin call on Laurienti's First Union Partnership
Account . The margin call demanded that additional funds and/or securities be deposited into the
Partnership Account. First Union contacted Laurienti and demanded that he deposit cash or eligible
securities to meet the margin call and was told that if he did not meet the margin call, securities
would be sold in his account . Launenti met the call by liquidating shares of companies other than
En Pointe . Laurienti specifically instructed First Union never to sell his En Pointe shares to meet
a margin call .
92. Laurienti received an additional margin call from First Union on or about April 11 ,
2000 due to a further decline in the prices of En Pointe . Laurienti again instructed First Union not
to sell any En Pointe stock in the Partnership Account as he represented he was in the process of
obtaining funds and/or securities to deposit into the Partnership Account to meet the margin call .
Laurienti told First Union that he could get a letter of authorization to transfer $2 million from an
existing account at First Union. The existing account was that of Mediha Din, the eighteen-year-old
daughter of Bob Din . Bob Din suggested to First Union that his daughter would authorize the
transfer of $2 million from her First Union account to JSL Holdings' First Union account . Laurienti
told First Union that he had, in fact, made the arrangements to receive the $2 million loan and that
the margin calls would be met. Based upon these representations, First Union did not immediately
liquidate the entire Partnership Account . Upon consultation with his in-house lawyer at En Pointe
about this transaction, however, Bob Din rescinded his offer to transfer $2 million from his
daughter's First Union account because his counsel advised him that the transfer of funds would be
"too obvious". Bob Din then attempted to arrange for a banker to loan Laurienti $2 million to cover
the debit balance . When the banker, Laurienti and King informed a margin clerk that such a loan
would take a week to arrange, First Union liquidated the remainder of the account to meet the margin
calls . First Union has since filed a NYSE arbitration claim against En Pointe, Bob Din and Laurienti
for fraud in connection with Laurienti's margin account, and Bob Din's and Laurienti's promotion
of En Pointe common stock.
First Amended Consolidated Class Action Complaint 27 Master Case No , 01 -CV-0205 L (CGA)
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93. Nine days after the effective date of the sale of majority interest in SupplyAccess, o n
April 13, 2000, En Pointe and Bob Din issued a press release announcing the closing of a
supplemental sale of SupplyAccess preferred stock of $7 .6 million and that En Pointe was "no longer
a majority stockholder of SupplyAccess, Inc." In response to this stunning revelation, En Pointe's
stock price plummeted from its opening price of $27 .3125 to close at $12 .875 on 2,003,800 shares
traded .
94. During and immediately after the April 13, 2000 crash of En Pointe stock, and in
order to relieve some of the selling pressure, Sam Tedesco recalls that Hampton-Porter's tradin g
room refused to accept sell orders from clients, at the direction of Walker .
95. The aftermath of the April 13 revelation was reportedby Bloomberg News as follows :
En Pointe Technologies Inc . (ENPT) shares fell $14 .63, or 53 percent, to $12 .88 .The provider of business-to-business information technology products and servicessaid it's no longer the majority owner of SupplyAccess, Inc ., an operator of abusiness procurement web site .
96. On April 14, 2000, En Pointe further revealed, contrary to prior representations, tha t
En Pointe's ownership interest had specifically declined (below 50%) to 45 .1%. Specifically, on
April 14, 2000, the Company filed a report on Form 8-K with the SEC, stating in part that,
[En Pointe's] web procurement subsidiary, SupplyAccess, Inc . completed a $7 .6million supplemental private placement of Series A preferred stock . Total sharesissued were 5 .1 million at $1 .50 each and represented 16 .3% of the total sharesoutstanding. At the conclusion of the sale, the Company's percentage ownership inSupplyAccess was 45.1 % .
In response to this more specific announcement, En Pointe's stock price further declined from it s
opening price of $12.875 to close at $10 .625 on 878,400 shares traded .
Post-Class Period Events
97. On April 14, 2000, a Hampton-Porter client named Steven Crosby went to Hampton-
Porter's offices and met with Laurienti, Walker, his broker Brian Laurienti and several other
Hampton-Porter representatives, including Sam Tedesco . By April, Sam Tedesco recalls that
Laurienti had stopped making daily appearances at the offices of Hampton-Porter and Sam Tedesco
had been told that by Brian Laurienti that Laurienti was not showing up to his office at Hampton-
Porter because he was not well, however, Laurienti unexpectedly appeared at the offices o f
First Amended Consolidated Class Action Complaint 28 Master Case No. 01-CV-0205 L (CGA)
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1 Hampton-Porter for the April 14, 2000 meeting with Steven Crosby. At the April 14, 2000, Steven
2 Crosby was informed that Laurienti and Walker and Hampton-Porter were working feverishly to
3 support En Pointe's share price, and that Bob Din had agreed to provide $1 million to Hampton-
4 Porter secretly to allow Defendants to create artificial demand for the stock and prop up the
5 plummeting share price. Steven Crosby was also informed that Hampton-Porter was purposefully
6 disguising these purchases to make them appear to be made through different brokerage firms.
7 98. On April 17, 2000, in a last-ditch effort to boost En Pointe's share price and continue
8 with Defendants' scheme, Sam Tedesco recalls Walker causing Hampton-Porter in-house analyst
9 Todd Picture to publish another report on behalf of Hampton-Porter touting En Pointe and
10 SupplyAccess . This report contained a "strong buy" recommendation for En Pointe's stock and
11 stated that En Pointe's stock had been "oversold due to market conditions . "
12 99. Following the events outlined in the Class Period, various legal actions, including
13 those filed by Lead Plaintiffs and by First Union and the Crosbys, have been instituted against
14 Defendants in connection with their scheme to manipulate the price of En Pointe securities, including
15 the federal action entitled Merrill Lynch Pierce Fenner & Smith, Inc. v, John Laurienti, 00-CV-
16 00781 L(POR), the California actions entitled First Union Securities, Inc. v. JSL Holdings, L.P., et.
17 al., Case No. GIC748336, Kenneth L. Fredrick v. Attiazaz Din, et al., Case No. YC039456, and
18 Steven and Jenifer Crosby v. En Pointe Technologies, Inc., et al., No. GIC759905, the National
19 Association of Securities Dealers arbitration action entitled Steven and Jenifer Crosby v . Hampton-
20 Porter Investment Banking, LL C, et al., and the New York Stock Exchange arbitration action entitled
21 First Union Securities, Inc. v. John [W.] Laurienti, et . al., NYSE Docket No. 2000-008703 .
22 Moreover, the legal actions pending and anticipated against Hampton-Porter cause it to close up
23 shop. As reported on May 17, 2001, The San Diego Union-Tribune published an article stating, in
24 relevant part "Hampton-Porter, a brokerage house with a history of disciplinary actions and lawsuits
25 against it, has abruptly departed its office in downtown San Diego . "
26 100. As of July 11, 2002, following 90 days after the end of the Class Period, the
27 Company's share price never recovered and averaged only $10 .68 per share after the April 13, 2000
28 En Pointe press release, as reflected in the Price and Volume History of En Pointe common stock
First Amended Consolidated Class Action Complaint 29 Master Case No. 01-CV-0205 L (CGA)
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II attached hereto as Exhibit 1 and the chart below :
I En Pointe PriceNolume History
2,500,000
2,000,000
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$60nVolum e
$50 Open
$40 Hig h
Lo w$30
Clos e$20
$1 0
$00 00 0
t10 ti
This price reflects less than a $54 million market capitalization for the Company, after its Insiders
profited at least $35 million dollars alone from their Insider sales from February 28 to March 15,
2000.
CAUSATION ALLEGATIONS
101 . En Pointe's common stock was publicly traded on the NASDAQ NMS at all relevant
times . Defendants' material misrepresentations, omissions and manipulative contrivances had the
effect of artificially inflating the price of En Pointe's stock .
102 . Defendants had a duty to promptly disseminate accurate and truthful information with
respect to En Pointe's financial and operational condition or to cause and direct that such information
be disseminated and to promptly correct any previously disseminated information that was
misleading to the market, As a result of their failure to do so, the price of En Pointe's stock price
was artificially inflated during the Class Period, damaging Lead Plaintiffs and the Class .
103 . Defendants' false and misleading statements and omissions in their public statements
directly caused losses to the Class . On the strength of these false statements, misrepresentations and
material omissions, the Company's stock was artificially inflated to a Class Period high of $52 on
February 25, 2000 and remained artificially inflated until the end of the Class Period, as reflected
in the Price and Volume History of En Pointe common stock attached hereto as Exhibit 1 . Lead
First Amended Consolidated Class Action Complaint 30 Master Case No. 01-CV -0 205 L (CGA)
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1 Plaintiffs and all class members who bought shares during the Class Period were harmed thereby,
2 when the share prices plummeted on April 13, 2000 upon the revelation of the true nature of the
3 Company's ownership of SupplyAccess .
4 104. Until shortly before the filing the original complaint, Lead Plaintiffs and the Class
5 was unaware of all of the facts, as described herein, and could not have reasonably discovered the
6 Defendants' fraudulent scheme by the exercise of reasonable diligence .
7 ADDITIONAL SCIENTER ALLEGATION S
8 105. Each misrepresentation and/or omission ofmaterial fact alleged herein was made with
9 reckless disregard for, or knowledge of its false and misleading nature . At all relevant times, Bob
10 Din was in a position to know, and did in fact know the material facts regarding the Company as
11 set forth herein. Specifically, Bob Din was in a position to know, and indeed must have known that
12 the Company was not actively operating as a competitor to Ariba and Commerce One . Indeed, as
13 described above, En Pointe was listed in a Commerce One press release as a purchaser of
14 Commerce One's services and products, rather than a competitor . Similarly, Bob Din was in a
15 position to know, and must have known or recklessly disregarded the fact that the Company would
16 complete on April 4, 2000 a supplemental private placement offering which would reduce the
17 Company's ownership in SupplyAccess to a minority position (below 50%) to 45.1% . Indeed, by
18 February 25, 2000, Defendants had done a primary closing on the supplemental offering, and thus
19 had to know the full terms of the deal by the date, and almost certainly months before .
20 106. Bob Din had the opportunity to commit and participate in the fraud described herein.
21 Bob Din was the co-founder of En Pointe, the Chairman of the Board of Directors, the Chief
22 Executive Officer and the President of En Pointe and shareholder of En Pointe and thus controlled
23 the Company's press releases, corporate reports, SEC filings and communications with analysts .
24 Thus, Bob Din controlled the public dissemination of and could falsify and/or omit, the material
25 information about En Pointe's business prospects and operations, that reached the public and
26 affected the price of En Pointe stock .
27 107. Laurienti, Walker, Hampton-Po rter, and the other Hampton-Porter related defendants
28 were engaged in a purposeful, intentional manipulation of the market for En Pointe's stock at all
First Amended Consolidated Class Action Complaint 31 Master Case No . 0 l -CV-0205 L (CGA)
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1' times during the Class Period. As such, they intentionally paid incentive kickbacks to brokers for
11 selling En Pointe stock to unwitting customers, intentionally parked stock in clients' account s
without their consent, intentionally avoided selling En Pointe stock for clients and seized bac k
1 incentive payments made to brokers whose clients sold their shares. These intentional acts were al l
11 a part of a scheme the express purpose of which was to artificially inflate the share price of En Point e
11 stock. Laurienti profited at least $2 .2 million by siphoning off cash from his margin account whe n
the En Pointe's share price was high, and then refusing to pay back such cash when margin call s
1 were precipitated by the crash in En Pointe's share price . Lauritenti, Bob Din and broker Troy Peter s
also anticipated the crash in En Pointe's share price, and profited from short selling En Pointe stock
in Canadian accounts established and managed by Amr I . Elgindy .
108 . By mid-March, the price of En Pointe shares had been driven to astronomical levels .
What had previously been a $9 stock as late as December 1999 had increased five-fold to $52, as
reflected in the Price and Volume History of En Pointe common stock attached hereto as Exhibit 1 .
Enticed by the prospect of immediate and sizeable returns at the stock's all-time high and th e
I undisclosed knowledge of the impending sale of En Pointe's controlling interest in SupplyAccess ,
the Insiders began a wholesale sell-off of their shares . Despite the fact that it is unlawful for any
person who is an officer, director or controlling person of an issuer to sell stock in the issuer at a tim e
when he/she knows material information about the issuer which would significantly affect the marke t
price of the issuer's security, Bob Din,, while concealing the scheme to artificially inflate the price
of En Pointe securities, and the Insiders sold hundreds of thousands of En Pointe shares to th e
I unsuspecting public between February 28, 2000 and March 15, 2000, Insiders sold nearly 700,00 0
shares of En Pointe netting over $35 million . The Insiders' selling during the Class Period i s
summarized as follows :
INSIDER NUMBER OF SHARES PROCEEDS
Bob Din, and his wife, 202,000 8,958,78 0Naureen Din, Secretary andDirector
Bob Din, on behalf of 100,000 4,339,000Mediha Din
First Amended Consolidated Class Action Complaint 32 Master Case No. 0I-CV-0205 L (CGA)
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Bob Din, on behalf of All 100,000 4,393,71 1Mohyuddin
Zubair Ahmed, Director 165,000 7,660,537
Mark Briggs, Director 18,000 869,249
Verdell Garroutte, Director 10,000 463,729
Javed Latif, Chief Financial 47,185 2,154,802Officer and the brother-in-law of Bob Din
Ellis Posner, Vice-President 33,000 1,506,85 3of Sales
Jacob Stetton, Senior Vice 10,000 463,730President and the GeneralCounsel
Robert Mercer, Vice 7,322 339,542President
Eric Keating, Vice-President 5,600 262,182of Services
TOTAL 698,017 $35,751,115
109 . During the Class Period, Bob Din, together with his wife Naureen Din, (and in
addition to the sales made on behalf of in their minor children), made the following sales of En
Pointe common stock while in possession of material adverse information concerning the
Company's business and finances as described herein :
DATE SHARES PRICE PROCEEDS
02-28-00 20,000 $44.05 $881,000
02-29-00 30,000 $42.73 $1,281,900
03-01-00 15,000 $45.46 $681,900
03-06-00 30,000 $40.83 $1,224,900
03-08-00 53,000 $43.78 $2,320,340
03-10-00 24,000 $50.36 $1,208,640
03-14-00 20,000 $45.66 $913,200
03-15-00 10,000 $44.69 $446,900
TOTAL : 202,000 $8,958,780
First Amended Consolidated Class Action Complaint 33 Master Case No. 01-CV-0205 L (CGA)
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1 110. These sales are unusual and suspicious in their timing and amount since Insiders had
2 never before sold shares in February and March (and therefore such sales were not part of an adopted
3 annual practice) and Insiders sold a majority of their ownership positions as demonstrated below-
4 (1) Bob Din and Naureen Din sold 61 .5% of their ownership position ;(2) Zubair Ahmed sold 20% of his ownership position for $7.66 million
5 (3) Mark Briggs sold 100% of his ownership position ;(4) Verdell Garroutte sold 100% of his ownership position ;
6 (5) Eric Keating sold 100% of his ownership position;(6) Javed Latif sold 89.3% of his ownership position ;
7 (7) Robert Mercer sold 1QOO of his ownership position ;(8) Ellis Posner sold 68 .4% of his ownership position; and
8 (9) Jacob Stetton sold 58% of his ownership position .
9 111. Moreover, these sales took place shortly after the Defendants primed the market with
10 their talk of being "well positioned" to compete with Ariba and Commerce One and their
11 SupplyAccess venture . The Insiders' sales were also timed to take advantage of the artificial demand
12 for En Pointe stock that was fostered by Hampton-Porter's boiler room operation, and to precede the
13 announcement that En Pointe's ownership of SupplyAccess had fallen below 50% .
14 112. The combination of attributable knowledge with the evident profit incentives for Bob
15 Din creates a strong inference of scienter .
16 FRAUD ON THE MARKET ALLEGATION S
17 113. At all relevant times, the market for En Pointe common stock was an efficient market
18 for the following reasons, among others :
19 a. At all relevant times during the Class Period, En Pointe's common stock waslisted and actively traded on the NASDAQ NMS, a highly efficient national
20 securities market. During the Class Period, the Company had approximately6.5 million shares of common stock issued and outstanding ;
21b . As a registered and regulated issuer of securities, En Pointe filed periodic
22 reports with the SEC and the NASDAQ NMS, in addition to the frequentvoluntary dissemination of information described in this Complaint; and
23c. Several financial analysts covered and reported on En Pointe's developments,
24 and disseminated such reports to the investing public .
25 114. As a result of the above, the market for En Pointe securities promptly digested current
26 information with respect to En Pointe from all publicly available sources and reflected such
27 information in En Pointe's stock prices. Under these circumstances, all purchasers of En Pointe
28 stock during the Class Period suffered similar injury through their purchase of securities at price s
First Amended Consolidated Class Action Complaint 34 Master Case No. 01-CV-0205 L (CGA)
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I which were artificially inflated by the Defendants ' manipulative activities . Thus, a presumption of
11 reliance applies .
FIRST CLAIM FOR RELIEFViolations of Section 10(b) of The Securities Exchange Act of 1934
and Rule 10b -5 Promulgated thereunder(Against All Defendants)
115 . Plaintiff incorporates by reference and realleges all preceding paragraphs as thoug h
I fully set forth herein.
116. During the Class Period, Defendants En Pointe, Bob Din, Hampton-Porter, H-P, Time
Holdings, JSL Holdings, JSL Enterprises, Laurienti, and Walker engaged in a plan, scheme and
course of business which operated as a fraud upon Plaintiff and the Class, and made various untru e
statements of material fact and omitted to state material facts necessary to make the statements made ,
in light of the circumstances under which they were made, not misleading to Plaintiff and the Class
as set forth above . The purpose and effect of this scheme was to induce Plaintiff and the Class to
purchase the Company's common stock during the Class Period at artificially inflated prices .
117. Byreason ofthe foregoing, Defendants knowingly orrecklessly violated Sectionl0(b)
of the Securities Exchange Act of 1934 (hereinafter "Exchange Act") and Rule I Ob-5 promulgated
thereunder in that they themselves or a person whom they controlled : (a) employed devices, schemes
and artifices to defraud ; (b) made untrue statements ofmaterial facts or omitted to state material facts
necessary in order to make the statements made, in light of the circumstances under which they wer e
made, not misleading ; or (c) engaged in acts, practices and a course of business that operated as a
fraud or deceit upon Plaintiff and the Class in connection with their purchases of the Company's
common stock during the Class Period.
118. As a result of the foregoing, the market price of the Company's common stock was
artificially inflated during the Class Period. In ignorance of the false and misleading nature of the
representations described above, Plaintiff and the Class relied, to their detriment, directly on the
misstatements or the integrity of the market both as to price and as to whether to purchase these
securities. Plaintiff and the Class would not have purchased En Pointe stock at the prices they paid,
or at all, if they had been aware that the market prices had been artificially and falsely inflated b y
First Amended Consolidated Class Action Complaint 35 Master Case No. 01-CV-0205 L (COA)
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Defendants' false and misleading statements and omissions . At the time of the purchase of En
Pointe stock by Plaintiff and the Class, the fair market value of said common stock was substantiall y
11 less than the price paid by Plaintiff. Plaintiff and the Class have suffered substantial damages as a
I result .
SECOND CLAIM FOR RELIE FViolations of Section 20(a) of The Securities Exchange Act of 1934
(Against Defendants Attiazaz "Bob" Din, John William Laurienti, Gregory Walker,H-P Holdings, LLC, and JSL Enterprises, LLC)
119 . Plaintiff incorporates by reference and realleges all preceding paragraphs as thoug h
fully set forth herein .
120. Defendant Bob Din is liable for En Pointe 's material misrepresentations and
omissions complained of herein under §20(a) of the Exchange Act in that he functioned as control
persons of En Pointe by virtue of his executive and directorial positions with the Company, his
knowledge of and involvement in the business of the Company, his daily access to confidential
information regarding the operations and finances of the Company, and his power and ability to
make public statements on behalf of En Pointe to shareholders, potential investors and the media
during the Class Period. As such, they had the power and ability to control the Company's actions .
121 . During the Class Period, defendants Laurienti, Walker and H-P were control persons
of Hampton-Porter, in that H-P owned 100% of Hampton-Porter, Walker and Laurienti own and
controlled H-P, H-P owned Hampton-Porter, Walker was the President of Hampton-Porter, and
Laurienti was empowered by Walker to direct Hampton-Porter's activities and communications . In
this regard, H-P, through Walker, and Laurienti had direct access to Hampton-Porter's proprietary
information systems, and had ultimate control of Hampton-Porter's trading schemes an d
communications functions, including the publishing of analyst reports .
122. During the Class Period, defendants Laurienti and JSL Enterprises were control
persons of JSL Holdings, in that JSL Enterprises is the sole general partner of JSL Holdings and
Laurienti has a majority ownership interest in JSL Holdings . In this regard, Laurienti and JSL
Enterprises had knowledge of and involvement in the day to day business of JSL Holdings . As such,
they had the power and ability to control JSL Holdings' actions .
First Amended Consolidated Class Action Complaint 36 Master Case No. O1-CV-0205 L (CGA)
9 0
1 123. During the Class Period, Laurienti was a control person of JSL Enterprises, in that
2 Laurienti has a majority ownership interest in JSL Enterprises . In this regard, Laurienti had
3 knowledge of and involvement in the day to day business of JSL Holdings . As such, they had the
4 power and ability to control JSL Enterprises' actions .
5 124. During the Class Period, defendants Laurienti and Walker were control persons of
6 Time Holdings, in that Laurienti and Walker have joint ownership of Time Holdings . In this regard,
7 Laurienti and Walker had knowledge of and involvement in the day to day business of Time
8 Holdings . As such, they had the power and ability to control Time Holdings' actions .
9 THIRD CLAIM FOR RELIEFFor Violations of Sections 10(b) and 20A of The Securities Exchange Act of 1934
10 (Against Defendants Attiazaz "Bob" Din)
11 125. Plaintiff incorporates by reference and realleges all preceding paragraphs as though
12 fully set forth herein ,
13 126. This claim is asserted against defendant Bob Din pursuant to § § 10(b) and 20A of the
14 Exchange Act and Rule lOb-5 promulgated thereunder, by a Subclass consisting of all purchasers
15 of En Pointe stock who purchased such stock contemporaneously with the insider sales of the
16 Insiders, which took place between February 28 and March 15, 2000 as detailed herein .
17 127. During the Class Period, as detailed above, Bob Din, while in possession of material,
18 non-public information concerning the supplemental offering of SupplyAccess stock and
19 SupplyAccess' uncompetitive position, took advantage of the inflated market for En Pointe's stock
20 by dumping his own shares on unwitting investors . In so doing, Bob Din aquired over $18 million
21 from his stock sales ,
22 128. Bob Din's stock sales were timed to take advantage of the information gap that
23 existed between the time of the initial announcements and analyst reports concerning SupplyAccess,
24 and the revelation that En Pointe had reduced its ownership of SupplyAccess to a minority position,
25 and during the concealment of the pump and dump scheme . At the time of their insider sales, Bob
26 Din knew or recklessly disregarded that they possessed materially adverse non-public information
27 regarding the supplemental offering of SupplyAccess stock, the fact that SupplyAccess was not a
28 genuine competitor to Ariba and Commerce One in the B2B marketplace, and the pump and dump
First Amended Consolidated Class Action Complaint 37 Master Case No. 01 -CV-0205 L (CGA)
F9L J
1 scheme and that this information had not been disclosed to the investing public .
2 129. As set forth above, defendant Bob Din violated § 10(b) and 20A of the Exchange Act
3 and SEC Rule 1 Ob-5. As a direct and proximate result of Bob Din's wrongful conduct, and by virtue
4 of the fact that Lead Plaintiffs and the Subclass purchased shares of En Pointe stock on the
5 NASDAQ NMS contemporaneously, Lead Plaintiffs and the Subclass suffered damages in
6 connection with these purchases . Such damages stem from the fact that Lead Plaintiffs and the
7 Subclass paid artificially inflated prices for En Pointe stock as a result of Bob Din's violations, and
8 would not have purchased at such inflated prices, if at all, had Bob Din fulfilled his legal duty to
9 disclose the materially adverse non-public information or abstain from selling such securities .
10 130. Lead Plaintiffs Richard Tavano and Dennis Pasko purchased shares of En Pointe
11 stock contemporaneously with Bob Din's sales, as reflected in these Lead Plaintiffs' certifications,
12 on file with the Court . Specifically, Richard Tavano purchased 1,000 shares on March 8, 2000 and
13 100 shares on March 15, 2000 ; and Dennis Pasko purchased 500 shares on February 28, 2000, and
14 1400 shares on March 8, 2000 .
15 PRAYER FOR RELIEF
16 WHEREFORE, Plaintiff, on his own and on behalf of the Class, pray for judgment as
17 follows:
18 1. Declaring this action to be a class action pursuant to Rules 23(a) and 23 (b)(3) of the
19 Federal Rules of Civil Procedure on behalf of the Class defined herein ;
20 2. Awarding Lead Plaintiffs and the Class rescissory or compensatory damages in an
21 amount which may be proven at trial, together with interest thereon ;
22 3. Awarding Lead Plaintiffs and the Class pre-judgment and post judgment interest, as
23 well as their reasonable attorneys' fees and expert witness fees and other costs ; and
24 l/I
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First Amended Consolidated Class Action Complaint 38 Master Case No . Ol-CV-0205 L (CGA)
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4. Awarding such other and further relief as this Court may deem just and proper
including any extraordinary equitable relief and/or injunctive relief as permitted by law or equity to
attach, impound or otherwise restrict the Defendants ' assets to assure Lead Plaintiffs and the Class
have an effective remedy.
Dated : October 7 , 2002 By:Jame C . Krause, Esq .Pat 'ck N . Keegan, Esq .Eric J . Benink, Esq .KRAUSE & KALFAYAN
Burton H. Finkelstein, Esq .Donald J . Enright, Esq .FINKELSTEIN, THOMPSON& LOUGHRAN
Lead Counsel for Lead Plaintiffs
Other Plaintiffs' Counsel :
Robert I . Harwood, Esq .Frederick W . Gerkens, III, Esq .WECHSLER HARWOOD HALEBIAN & FEFFER LLP488 Madison AvenueNew York, NY 10022
Michael D . Braun, Esq.I Patrice L. Bishop, Esq .STULL, STULL & BROD Y10940 Wilshire Boulevard , Suite 2300Los Angeles , CA 90024
Jules Brody, Esq .Aaron L . Brody, Esq.STULL, STULL & BRODY6 east 45`h Stree tNew York, NY 90024
Marc S. Henzel, Esq.LAW OFFICES OF MARC S . HENZEL210 West Washington SquareThird FloorPhiladelphia, PA 19106
Kevin J . Yourman, Esq .Vahn Alexander, Esq .WEISS & YOURMAN10940 Wilshire Boulevard , 24th FloorLos Angeles , CA 90024
First Amended Consolidated Class Action Complaint 39 Master Case No. 01 -CV-0205 L (CCA)
1 Ronald A. Marron, Esq .MARRON & WILSON, LLP
2 1475 Sixth Avenue, Suite 301San Diego , CA 9210 1
3Evan Smith, Esq .
4 BRODSKY & SMIT H11 Bala Avenue , Suite 39
5 Bala Cynwyd, PA 19004
6 Corey D HolzerHOLZER & HOLZER
7 6135 Barfield Road , Suite 102Atlanta, GA 3032 8
8Kirk Hulett, Esq .
9 HULETT HARPER LLP550 West C Street , Suite 1770
10 San Diego, CA 9210 1
11 Jeffery R. Krinsk, Esq .FINKELSTEIN & KRINSK
12 501 West Broadway , Suite12S0San Diego, CA 9210 1
13Alfred G. Yates, Jr., Esq .
14 LAW OFFICES OF ALFRED G . YATES, JR.519 Allegheny Building
15 429 Forbes AvenuePittsburgh , PA 15219
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11 First Amended Consolidated Class Action Complaint 40
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DEMAND FOR JURY TRIALRule 38 (b) of the Federal Rules of Civil Procedur e
Lead Plaintiffs , on behalf of themselves and all others similarly situated , hereby demand a
trial by jury of this action .
Dated : October 7, 2002 By:James . Krause, Esq .Pat ' N. Keegan, Esq .Eric J . Benink, Esq.KRAUSE & KALFAYAN
Burton H . Finkelstein, Esq .Donald J . Enright, Esq .FINKELSTE1N, THOMPSON& LOUGHRAN
Lead Counsel for Lead Plaintiffs
First Amended Consolidated Class Action Complaint 41 Master Case No. 01-CV-0205 L (CGA)
0 •
En Pointe Technologies, Inc.NasdaNM :ENPT
Date Volume Open High Low Close7-Dec-99 29 ,800 8 . 75 9 8.6875 8.6875 Class Starts8-Dec-99 55,100 8.6875 8 .9375 8 .25 8.759-Dec-99 34,400 8.25 8 .9688 8 .25 8.5625
10-Dec-99 134,700 8.4688 9.25 7.8125 8.468813-Dec-99 67,000 8.5625 9 8.5 8.687514-Dec-99 14,500 8 .5 8 .9688 8.5 8.968815-Dec-99 43,600 9 9.375 8 .5625 916-Dec-99 84,100 8.9062 10.25 8 .9062 10 .12517-Dec-99 111,500 10 10.4375 9.375 10.437520-Dec-99 49,100 10.0625 10 .0625 9.5 9 . 521-Dec-99 98,000 9.25 10 - 8.875 9.7522-Dec-99 154,700 9.4375 10 8 .25 9.7523-Dec-99 690,500 9.75 14 .25 9 .5625 13 .87527-Dec-99 881,200 15.9375 17.125 15.0625 16 .62528-Dec-99 972,000 17.0625 26.875 16.625 21 .87529-Dec-99 1,066,800 21 .8125 30 21 .625 25 . 530-Dec-99 627,600 25.4062 25.9375 19 .25 25.937531-Dec-99 253,000 26 29.5 23 .25 27 . 5
3-Jan-00 488,400 30,626 31 .25 27.5 304-Jan-00 341,000 28.25 30 27.5 29.255-Jan-00 528,100 28 .5 40 28 38.256-Jan-00 596,800 36.4375 41 35.75 39.43757-Jan-00 309,800 39.625 39.9375 35 .25 37.75
10-Jan-00 250,100 38.0625 40.5 36.5 3711-Jan-00 177,000 37.25 39.75 36.875 37.812512-Jan-00 257,400 38.3125 38.375 33 33.312513-Jan-00 361,900 33.3125 33.3125 29.9375 31 . 514-Jan-00 165,900 32 35.25 31 33 . 518-Jan-00 77,900 33.125 34.75 31 .25 31 .2519-Jan-00 129,600 30.0625 30.0625 27 .25 29.562520-Jan-00 121,500 28.2188 29.9375 26 .75 2721-Jan-00 221,600 26.75 34 26 .75 3424-Jan-00 308,800 34 42.5 33 37.062525-Jan-00 161,200 38 .5 39.375 34 .25 38.2526-Jan-00 154,100 38.375 40 38 38 . 527-Jan-00 120,900 39.25 40 34.5 3628-Jan-00 179,000 37.25 40.375 36.125 40.2531-Jan-00 170,200 41 .5938 42 35.625 391-Feb-00 125,900 39 .5 41 .875 38 38.68752-Feb-00 63,000 38.6875 40 37 393-Feb-00 97,500 39 .5 40.9375 39 .25 40.56254-Feb-00 65,400 40.625 41 .25 39.125 40 . 57-Feb-00 91,300 39 .5 40.625 36 .25 37.258-Feb-00 117,200 37 .5 38.5 35.875 38 . 59-Feb-00 161,700 38.0625 41 .5 38.0625 40.3125
10-Feb-00 131,900 41 .5 41 .5 39 41 .2511-Feb-00 119,500 40 40.5 38 39.2514-Feb-00 52,900 37.7812 39 37.5 37 .62515-Feb-00 35,900 37 .5 38.5 37.375 38.25
I
En Pointe Technologies, Inc .NasdaNM:ENPT
Date Volume Open High Low Close16-Feb-00 432,300 38.3125 48 37.875 4617-Feb-00 175,500 49.25 49.75 44.125 4618-Feb-00 120,200 46.25 48.25 42.75 4422-Feb-00 111,100 43.9375 44.75 42.625 44.7523-Feb-00 87,300 44.6875 47 44 4624-Feb-00 66,400 45.4375 47 44.125 46 .7525-Feb-00 390,100 47.25 55 45.75 5228-Feb-00 407,200 52 52.25 46.25 4729-Feb-00 510,500 49.125 49 .125 42.625 44
1-Mar-00 203,300 44.3125 47 43.75 44 .252-Mar-00 93,800 45 45.125 43.125 443-Mar-00 99,100 44 .5 47 42.625 43.756-Mar-00 294,200 44 45.5 40 41 .6257-Mar-00 210,000 41 .125 47.25 40.875 428-Mar-00 534,100 43 .5 47 42.875 45.8759-Mar-00 451,000 47 51 45.8125 48.9375
10-Mar-00 276,000 49.6875 52.625 49.625 50.37513-Mar-00 154,400 49.5 51 46 4714-Mar-00 191,200 47 48.75 44.875 45.2515-Mar-00 204,000 45.25 45 .3125 43.625 44.7516-Mar-00 147,100 44.875 47 43.125 44.87517-Mar-00 59,700 46 46 .5625 44.8125 45 . 520-Mar-00 111,400 46.1875 46 .1875 44 45.2521-Mar-00 116,700 45.5 45.5 42 .125 43.62522-Mar-00 55,200 43.6875 44 .25 42 43 .37523-Mar-00 140,600 42 43 41 .5 42.062524-Mar-00 57,500 42 .0625 42.875 41 .3125 42.187527-Mar-00 33,800 42 42.375 40.625 41 .7528-Mar-00 150,300 40 .0625 40 .0625 37.625 38 . 529-Mar-00 286,300 38 40 33 38 .812530-Mar-00 80,600 37 .75 38 .125 35.0625 36.62531-Mar-00 147,500 41 .2188 41 .25 35 40
3-Apr-00 64,100 40 .75 41 .1875 35.3125 35.54-Apr-00 216,200 36 37 26.25 335-Apr-00 136,500 31 .375 32 29.5 31 .6256-Apr-00 103,200 31 .1875 34 .875 31 .1875 347-Apr-00 73,200 35 36 .625 34 36
10-Apr-00 35,400 35.5 36 33 33 .312511-Apr-00 133,100 33 .25 33.25 28.5 30.2512-Apr-00 338,100 30 30.75 23 27.513-Apr -00 2,003 , 800 27 .3125 28.5 12 . 0625 12.875 Class End s14-Apr-00 878,400 12 .875 14 .875 8.5 10.625 90 Days17-Apr-00 443,000 9 .5 12 8.5 9. 518-Apr-00 709,900 9.75 12.25 8 .75 12.2519-Apr-00 350,100 13.2344 13 .375 11 .5 11 .937520-Apr-00 134 ,000 12 .375 12.75 11 .1875 12.524-Apr-00 134,300 11 .25 11 .75 10.5 1 125-Apr-00 170,900 11 .625 12.25 11 .5625 12.12526-Apr-00 164,000 12 .5 12.625 10.625 11 .5625
4/13/007111100
0
En Pointe Technologies, Inc .NasdaNM :ENPT
Date Volume Open High Low Close27-Apr-00 316,200 11 .75 11 .75 9.75 1 028-Apr-00 173,800 11 11 .375 10.375 1 11-May-00 205,300 11 .125 13 .125 11 .125 12.6252-May-00 234,800 12.5156 14.25 12 13.6253-May-00 205,300 14 14 12.75 13.43754-May-00 172,400 14.25 14.25 11 .5 12 .18755-May-00 66,700 11 .75 12.75 11 .75 12.1258-May-00 147,700 11 .5 12.875 11 .25 12 .56259-May-00 88,300 12.0625 12.75 11 11 .125
10-May-00 96,500 11 .75 11 .75 9.625 10.062511-May-00 82,300 10.5 10.5 9.625 10.12512-May-00 50,900 10.2812 10.5625 10 10.2515-May-00 25,100 10.75 10.75 9 .5 1 016-May-00 60,200 10 10.9375 9.75 10.87517-May-00 283,100 10.5312 14.3125 10.375 14 .312518-May-00 355,400 14.5 16.625 13.5625 14 . 519-May-00 115,600 14.6562 14.6562 12 12.7522-May-00 67,500 12.9375 13.5625 10.8125 1 223-May-00 88,500 12.1875 12.1875 10.375 10 . 524-May-00 89,200 10.625 10.625 9.625 10.312525-May-00 40,100 10.375 10.75 9.75 9 .781 226-May-00 79,300 9.75 10 .5 8.5 9.62530-May-00 24,600 9.9375 10.25 9.5 10.12531-May-00 45,900 10.25 10.6875 9.75 10 . 5
1-Jun-00 113,900 10.7812 12.25 10.5625 11 .752-Jun-00 73,500 11 .875 12.625 11 .5 12.1255-Jun-00 71,900 11 .875 12.5 11 .5 1 26-Jun-00 64,500 12.375 12.375 11 .5 11 .68757-Jun-00 40,900 11 .8125 11 .8125 9.5 9.68758-Jun-00 77,600 10.75 11 .75 9 .6875 11 .2 59-Jun-00 42,600 11 .3125 12.125 10.875 11 . 5
12-Jun-00 77,100 11 .25 12 11 .125 11 . 513-Jun-00 124,900 11 .375 11 .875 10 .75 10.87514-Jun-00 73,000 10.9375 10.9375 10 .0625 10.7515-Jun-00 49,900 10.125 10.25 10 1 016-Jun-00 42,700 10.1875 10.5 10 1 019-Jun-00 19,800 10.5 10.5 9 .75 9.87520-Jun-00 127,200 9.875 10 8.5 8.7521-Jun-00 91,300 9 9.5 8 .6875 9 . 522-Jun-00 13,600 9.875 9.9375 9.125 9 . 523-Jun-00 21,600 9.4375 9.875 8 .5625 8.62526-Jun-00 41,000 8.75 9 8.5 8.62 527-Jun-00 43,900 8.75 9.5 8 .75 9 . 528-Jun-00 36,100 9.5625 9.5625 8 .5625 8.7529-Jun-00 26,800 8.75 9.125 8.75 8 .7530-Jun-00 23,600 8.8125 9.125 8.75 8.7 5
3-Jul-00 23,600 8.75 8.875 8.25 8.62 55-Jul -00 45,500 8.5 8.5 7.6875 86-Jul-00 51,400 7 .625 7.75 6.75 7 .75
En Pointe Technologies, Inc.NasdaNM :ENPT
Date Volume Open High Low Close7-Jul-00 30,800 7 .75 8.25 7.625 7 .6875
10-Jul-00 54,400 7.8125 8 7.7188 811-Jul-00 90,000 7 .75 9.5 7 .75 9
10 .682 Average
Originating [From] Originating Originating Account Date Transaction Destination [To] Account $ AmountAccount! Statement [From] Account Name
Bank of America 33624174 Gregory D . Walker 61 15/1999 Check # 924 Schwab ($2,875 .00 )Bank of America 33624174 Gregory D . Walker 6/28/1999 Check # 655 Fortress Financial Group ($1 .000 .00)Bank of America 33624174 Gregory D . Walker 6/2911999 Check # 924 Hampton Porter ($13,000 .00)Bank of America 33624174 Gregory D . Walker 71111999 Check # 929 Hampton Porter ($9,000 .00)Bank of America 33624174 Gregory D . Walker 7!19/1999 Check # 943 Hampton Porter ($5,300 .00)Bank of America 33624174 Gregory D . Walker 7/24/1999 Check # 956 Hampton Porter ($4,000 .00)Bank of America 33624174 Gregory D . Walker 9 1 1 11999 Check # 969 Adam Gilman ($1,500 .0 0)Bank of America 33624174 Gregory D . Walker 9/1/1999 Check # 968 Adam Gilman ($1,000 .00)Bank of America 33624174 Gregory D . Walker 9/2/1999 Check # 970 Adam Gilman ($10,000 .00 )Bank of America 33624174 Gregory D . Walker 9/23/1999 Check # 987 Hampton Porter ($4,200 .00 )Bank of America 33624174 Gregory D . Walker 10/111999 Check # 991 Fortress Financial Group ($30,000 .00 )Bank of America 33624174 Gregory D. Walker 1 012011 9 9 9 Check # 994 Hampton Porter ($2,500 .00 )Bank of America 33624174 Gregory D . Walker 1012911999 Check # 995 Hampton Porter ($40,000 .00 )Bank of America 33624174 Gregory D . Walker 1112411999 Check # 1012 HP Holdings ($20,000 .00 )Bank of America 33624174 Gregory D . Walker 11 /3011 9 99 Check # 1015 HP Holdings ($30,000 .00 )Bank of America 33624174 Gregory D. Walker 11130/1999 Check # 1014 HP Holdings ($20,000 .00 )Bank of America 33624174 Gregory D . Walker 12/1/1999 Check # 1020 Drew Louis ($2,500 .00 )Bank of America 33624179 Gregory Walker 12/3/1999 Check Charles Schwab $10,000 .00Bank of America 33624174 Gregory D. Walker 12/17/1999 Check # 1028 HP Holdings ($15,000 .00 )Bank of America 33624174 Gregory D . Walker 12/22/1999 Check # 1031 HP Holdings ($17,500 .00 )Bank of America 33624174 Gregory D . Walker 12/25/1999 Check # 1030 HP Holdings ($75,000 .00 )Bank of America 33624174 Gregory D. Walker 12/31/1999 Check # 1036 HP Holdings ($100,000 .00 )Bank of America 33624174 Gregory D. Walker 1!212000 Check # 1062 Sam Tadesco ($1,000 .00 )Bank of America 33624174 Gregory D . Walker 1/6/2000 Check # 1054 Dave Adams ($1,500 .00 )Bank of America 33624174 Gregory D . Walker 1/12/2000 Check # 1058 B ryan Laurienti ($1,600.00 )Bank of America 33624174 Gregory D. Walker 112612000 Check # 1064 Bryan Launenti ($2,000 .00 )Bank of Ame rica 33624174 Gregory D . Walker 2/3/2000 Check # 1077 Bryan Laurienti ($8,000 .00 )
Bank of America 50103331 HP Holdings LLC 7/21/1999 Check # 1444 Greg Walker $3,745 .00
Bank of America 50503179 HP Holdings LLC 7/21/1999 Check # 0124 Greg Walker $2,000.00
Bank of America 170920788 Fortress Financial 6/29/2000 Check # 4237 Gregory D . Walker $1,243.00
Bank of America 450408700 HP Holdings LLC 1011/1999 Check # 10125 Greg Walker $4,204.6 5
Bank of America 1450008702 Time Holdings LLC 11122/1999 Check # 510 Greg Walker $4,700 .0 0Bank of America 1450408700 HP Holdings LLC 11/23/1999 Check # 10246 Greg Walker $4,204 .6 5Bank of America 1450008702 Time Holdings LLC 11/24/1999 Check # 513 Greg Walker $20,D00.00
Page 1 of 4
Comment
summary of cash transactions .xlsSheetl
Bank of America 1450008702 Time Holdings LLC 11/30/1999 Cheek # 514 Greg Walker $20 .000 .00Bank of America 1450408700 HP Holdings LLC 12/311999 Check# 10263 Greg Walker $20,000 .00Bank of America 1450408700 HP Holdings LLC 121311999 Check # 10285 Greg Walker $4,204 .6 5Bank of America 1450408700 HP Holdings LLC 12/20/1999 Check # 10302 Greg Walker $4,000 .00Bank of America 1450408700 HP Holdings LLC 1/6/2000 Check # 10390 Greg Walker $10,000 .00Bank of America 1450408700 HP Holdings LLC 1/14/2000 Check # 165 Greg Walker $4,121 .3 3Bank of America 1450408700 HP Holdings LLC 21112000 Check # 168 Greg Walker $4,121 .3 3Bank of America 1450408700 HP Holdings LLC 2/11/2000 Check # 10459 Greg Walker $4,121 .33Bank of America 1450408700 HP Holdings LLC 212 312 0 0 0 Check # 10519 Greg Walker $805 .0 8Bank of America 1450408700 HP Holdings LLC 3/1/2000 Check # 177 Gregory Walker $4,121 .3 2Bank of America 1450408700 HP Holdings LLC 3/912000 Check # 10546 Greg Walker $26,229 .5 8Bank of America 1450408700 HP Holdings LLC 31 15/2000 Check # 182 Greg Walker $4,121 .3 2Bank of America 1450408700 HP Holdings LLC 4!112000 Check # 187 Gregory Walker $4,115 .9 9Bank of America 1450408700 HP Holdings LLC 4/15/2000 Check # 192 Gregory Walker $4,155 .2 0
SchwabOne 7021355504 Time Holdings LLC 12117/1999 Check # 128 Greg Walker $15,000 .00SchwabOne 7021355504 Time Holdings LLC 12/2111999 Check # 101 Greg Walker $75,000 .0 0SchwabOne 7021355504 Time Holdings LLC 12/22/1999 Check # 103 Greg Walker $17,500 .0 0SchwabOne 7021355504 Time Holdings LLC 4/4/2000 Check # 151 Greg Walker $10,000 .00
TO Waterhouse 821-03688-1 -0 Time Holdings LLC 7/2/1999 CJ2 Company Check $400,000 .00TD Waterhouse 821-03666-1-0 Time Holdings LLC 7/1611999 Dep Check Deposit $400,000 .00TD Waterhouse 821-03688-1-0 Time Holdings LLC 8/4/1999 FIF Received From CY Natl BK LA $300,000 .00TO Waterhouse 821-03688-1-0 Time Holdings LLC 8/6/1999 FIF Received From CY Mad SK LA $14,935 .00TD Waterhouse 821-03688-1-0 Time Holdings LLC 8112/1999 Check CK # 91115253 ($522,000 .00 )TO Waterhouse 821-03688-1-0 Time Holdings LLC 8/1711999 Check CK # JW00133927 ($62,634 .00 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 8/20/1999 Check CK # 91116515 ($275,000 .00 )TD Waterhouse 821 -03688-1-0 Time Holdings LLC 8/24/1999 Check CK # JW00134679 ($21,150 .00 )TO Waterhouse 821-03688-1-0 Time Holdings LLC 8/24/1999 Check CK # JW00134680 ($7,644 .00 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 8/2511999 Check CK # JW00134793 ($100,000 .00 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 6/26/1999 Funds Wired F!F Wired to Bank of America ($117,000 .00 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 8/27/1999 Funds Wired F!F Wired to BK of AMER ($51,642 .53 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 10/1211999 Check CK # JW00140211 ($120,000 .00 )TD Waterhouse 821-03688-1-0 Time Holdings LLC 10/2111999 Funds Wired F/F from BK AMER $100,000 .00TD Waterhouse 821-03688-1-0 Time Holdings LLC 11/18/1999 Deposit Rec San Diego Operations $25,000.0 0TD Waterhouse 821-03688-1-0 Time Holdings LLC 11/19/1999 Deposit Rec San Diego Operationa $5,000.00
TO Waterhouse 821-05908-1-9 JSL Investments LLC 6/2211999 Check Deposit $100,000.00TO Waterhouse 821-05908-1-9 JSL Investments LLC 71611999 Check 00000101 ($2,000.00 )TD Waterhouse 821-05908-1-9 JSL Investments LLC 8119/1999 Check 00000105 ($10,000.00 )TD Waterhouse 821-05908-1-9 JSL Investments LLC 812311999 Check 00000106 ($10,000.00)
Charles Schwab 8838-1560 Time Holdings LLC 912 311 9 99 Wired Funds Bank of America-Time Holdir ($253,474.87)Charles Schwab 8836-1560 Time Holdings LLC 10/1511999 Wired Funds Funds received $170,000 .0 0Charles Schwab 8836-1560 Time Holdings LLC 111911999 Wired Funds ($253,747 .87 )Charles Schwab 8838-1560 Time Holdings LLC 11/24/1999 Chec # 4405895 ($20,000 .00)
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summary of cash transactions . xisPage 2 of 4 Sheetl
Charles Schwab 8838-1560 Time Holdings LLC 11/26/1999 Wired Funds ($20,000 .00 )
Bank of America D10162132392 JB Oxford & Company 10!1411999 Wired Funds Gregory D . Walker, 0033624 $10,000 .00Bank of America DI0162132392 JB Oxford & Company 10129f1999 Wired Funds Gregory D. Walker, 0033624 $39,714 .72
Bank of America D/1450008702 Hampton Porter 12J3011999 Wired Funds Gregory D . Walker, 0033624 $92,500 .00Bank of America D)1450008702 Hampton Porter 12131/1999 Wired Funds Gregory D . Walker, 0033624 $15,000 .00Bank of America 0/1450008702 Hampton Porter 12!3111999 Wired Funds Gregory D. Walker, 0033624 $100,000.00Bank of America D11450008702 Hampton Porter 11612000 Wired Funds Gregory D. Walker, 0033624 $60,000.00
First Union NPA5-4566-6834 JSL Holdings LP 10/5/2000 Wired Funds to Pink Acquisition Corp, Soy ($200,000.00)
Charles Schwab Time Holdings LLC 11/2611999 Wired Funds Bank of America-Time Holdir ($20,000 .00 )
Charles Schwab 8868-1560 Time Holdings LLC 12/6/1999 Wired Funds $10,000 .0 0
Bank of America 50504928 911/1999 Db-Cr Tel Auth 33624179 $5,000 .00 Customer: Gregory WalkerBank of America 50504928 901999 Db-Cr Tel Auth 33624179 $10,000 .00 Customer Gregory Walker, Prepared by 185
Bank of America 50504928 91211999 Db-Cr Tel Auth 33624179 $10,000 .00 Customer: Gregory Walker, Prepared by 4109
Bank of America 33624174 Gregory D. Walker 12122/1999 Check # 1016 Charles Schwab ($10,000 .00)Bank of America 33624174 Gregory D . Walker 1/1312000 Check # 1159 Washington Mutual ($4,100 .00)Bank of America 33624174 Gregory D . Walker 4/4/2000 Check # 796 First Union ($1,253 .99)
TD Waterhouse 358-01502-1-1 John Laurienti 12J811999 Check CK# 00101 ($50,000 .00)TD Waterhouse 358-01502-1-1 John Laurienti 1211311999 Check CK# 00103 ($91,588 .67 )TD Waterhouse 358-01502-1-1 John Laurienti 1212011999 Check CK # 00104 ($11,407 .37)TD Waterhouse 499-10030-1-5 John Laurienti 12/21/1999 Check CK # JW00153621 ($100,000 .00 )TD Waterhouse 358-01502-1-1 John Laurienti 12/23/1999 Check CK#00105 ($35,028 .52 )TD Waterhouse 499-10030-1-5 John Laurienti 1212911999 Check CK# JW00156284 ($250,000 .00 )TD Waterhouse 358-01502-1-1 John Laurienti 1131/2000 Transfer to acct 499-10030-2 ($13,299 .45 )TO Waterhouse 358-01502-1-1 John Laurienti 2/18/2000 Check CK # 00108 ($6,000 .00 )TD Waterhouse 358-01502-1-1 John Laurienti 2118/2000 Check CK # 00109 ($100,750 .00 )TD Waterhouse 358-01502-1-1 John Laurienti 2/22/2000 Check CK # 00108 ? Dup? ($$6,000 .00 )TO Waterhouse 358-01502-1-1 John Laurienti 2/22/2000 Check CK# 00109 ? Dup? ($100,750 .00 )TD Waterhouse 358-01502-1-1 John Laurienti 311 612 0 0 0 Check CK #00111 ($5,500.00 )TD Waterhouse 358-01502-1-1 John Laurienti 3/2012000 Check CK # 00110 ($10,021 .66 )
Charles Schwab 1587-5014 John W Laurienti 1/1912000 Wired Funds ($144,507 .64 )
First Union NPA5-5413-6986 John W Laurienti 217/2000 Check Check # 0000100 ($250,000.00 )First Union NPA5-5413-6966 John W Laurienti 2/912000 Check Check # 0000102 ($20,000.00 )First Union NPA5-5413-6966 John W Laurienti 2110/2000 Journal Entry JSL Holdings LP acct # 4568 ($6,235,878 .40 )First Union NPAS-5413-6986 John W Laurienti 211012000 Check Check # 0000101 ($6,000.00)
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summary of cash transactions .xlsPage 3 of 4 Sheet!
Merrill Lynch 72B-13851 John W LaurientiMerrill Lynch 72B-07387 John W Laurient iMerrill Lynch 72B-07387 John W Laurient i
First Union NPA5-4566-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings LPFirst Union NPA5-4568-6834 JSL Holdings L PFirst Union NPA5-4568-6834 JSL Holdings LPFirst Union NPA5-4568-6834 JSL Holdings LPFirst Union NPA5-4568-8834 JSL Holdings L P
TD Waterhouse 821-03688-1-0 Time Holdings LL C
Charles Schwab 8868-1560 Time Holdings LL CCharles Schwab Time Holdings LLC
Bank of America 1450008702 Time Holdings LLC
Charles Schwab 8838-1560 Time Holdings LLC
3/112000 Check CK to Evelyn Laurienti ($40,000 .00 )411 312 0 0 0 Funds Received Corporate CK $90,000 .004/13/2000 Funds Received Corporate CK $41,249 .0 0
2/14/2000 Wired Funds to B of A Wilson, Sonsini, Go ($100,000 .00 )2/14/2000 Wired Funds Norwest Bank, Virtual Techni ($589,600 .00 )2115/2000 Wired Funds Bank of America Wire #001-f ($100,000 .00 )2123/2000 Wired Funds Bank of America Wire #001 4 ($100,750 .00 )2/23/2000 Wired Funds to Bank of Am . Dogleg Right ($100,750 .00 )212412000 ADV Check Check # 00100 ($100,000 .00 )2/2412000 Wired Funds Wells Fargo Wire #001-RR8( ($1,000,000 .00 )2/2412000 Wired Funds Wells Fargo, Westwood CA, ($15,000 .00 )317/2000 Wired Funds Southern California ($200,000 .00 )3/7/2000 Wired Funds Southern California ($200,000.00)
3120/2000 Wired Funds Bank of America ($50,000 .00 )
12/811999 Transfer to acct 499-10030-2 $1,446,520.8 3
12/30/1999 Wired Funds ($107,500 .00 )12/30/1999 Wired Funds Bank of America-Time Holdir ($107,500.00)
1/25/2000 Check # 515 Charles Schwab $100.0 0
41512000 Check # 0151 ($10,000 .00)
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Page 4 of 4summary of cash transactions.xis
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James C. Krause, Esq ., SBN 66,478Patrick N. Keegan, Esq ., SBN 167,698KRAUSE & KALFAYAN1010 Second Avenue, Suite 1750San Diego, CA 9210 1Tel: (619) 232-0331Fax: (619) 232-4019
Burton H . Finkelstein, Esq.Donald J . Enright, Esq .FINKELSTE IN, THOMPSON & LOUGHRAN1050 30TH Street, N .W.Washington, DC 20007Tel: (202) 337-8000Fax : (202) 337-8090
Lead Counsel for Lead Plaintiffs(Additional Counsel on Signature Page)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF CALIFORNIA
In re EN POINTE TECHNOLOGIES, INCSECURITIES LITIGATION
This Document Relates To :
ALL ACTIONS
) Master Case No. 01-CV-0205 L (CGA)
PROOF OF SERVICE
)
)
I am employed with the LAW OFFICES OF KRAUSE & KALFAYAN , whose address is
1010 Second Avenue, Suite 1750, San Diego, Califo rn ia, 92101 ;1 am not a party to this cause . lam
over the age of eighteen years .
I further declare that on the date hereof I served a copy of the following documents : FIRST
AMENDED CONSOL IDATED CLASS ACTION COMPLAINT FOR VIOLATIONS OF
THE FEDERAL SECURITIES LAWS on the interested part ies listed below :
SEE ATTACHED SERVICE LIST
BY FIRST CLASS MAIL . I am familiar with the business practice of this office forcollection and processing of correspondence with the United States Postal Service on the same datethat it is placed for collection . I deposited in the ordina ry course of business at San Diego ,
Proof of Service I Master Case No. 01-CV-0205 L (CGA)
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California .
[X] BY UPS EXPRESS MAIL. I am familiar with the business practice of this office forcollection and processing of correspondence with the United Parcel Service on the same date thatit is placed for collection on October 7, 2002 .
[ ] BY PERSONAL DELIVERY . I then sealed the envelope and caused it to be handdelivered to the offices of the addressee .
[ ] BY FAX. Counsel whose name appears above, was faced a copy of said document(s)by facsimile transmission .
I declare under penalty of perjury that the foregoing is true and correct .
Executed on October 7, 2002 .
Stacy Boite l
Proof of Service 2 Master Case No . 01 -CV-0205 L (CGA)
M S
GREGG A. RUFFALO v . EN POINTE TECHNOLOGIES, INC.. et al .SERVICE LIST
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Todd E . Gordinier, Esq .John F . Cannon, Esq .Jason H . Anderson, Esq .STRADLING, YOCCA, CARLSON & RAUTH660 Newport Center Drive, Suite 1600Newport Beach , CA 92660-6422Tel: (949) 725-400 0Fax: (949) 725-4100
OF COUNSEL:Burton H. Finkelstein, Esq .Donald J . Enright, Esq .FINKELSTEIN, THOMPSON& LOUGHRAN1050 30TH Street, N.W.Washington , DC 20007
Robe rt I . Harwood, Esq .Frede rick W. Gerkens, III, Esq.Thomas J . Harrison, Esq .WECHSLER HARWOOD HALEBIAN& FEFFER LLP488 Madison AvenueNew York, NY 10022
Michael D . Braun, Esq .Patrice L. Bishop, Esq .STULL, STULL & BRODY10940 Wilshire Boulevard, Suite 2300Los Angeles, CA 90024
Jules Brody, Esq .Aaron L. Brody, Esq.STULL, STULL & BRODY6 east 45th StreetNew York, NY 90024
Marc S . Henzel, Esq .LAW OFFICES OF MARC S . HENZEL273 Montgomery Ave., Ste . 202Bala Cynwyd, PA 19104-2808
Kevin J . Yourman, Esq .Vahn Alexander, Esq .WEISS & YOURMAN10940 Wilshire Boulevard, 24th FloorLos Angeles , CA 90024
Attorneys for DefendantsEn Pointe Technologies, Inc ., Attiazaz"Bob" Din, Javed Latif, Naureen Din ,
Zubair Ahmed, Ellis Posner, MarkBriggs, Verdell Garroutte, Jacob Stetton,
Eric Keating, and Robert Mercer
Evan Smith, Esq.BRODSKY & SMITH11 Bala Avenue, Suite 39Bala Cynwyd, PA 1900 4
Corey D HolzerHOLZER & HOLZER6135 Barfield Road , Suite 102Atlanta, GA 30328
Kirk Hulett, Esq.HULETT HARPER, LLP550 West C Street, Suite 1770San Diego , CA 9210 1
Jeffery R. Krinsk, Esq .FINKELSTEIN & KRINSK501 West Broadway, Suite 1250San Diego, CA 9210 1
Alfred G. Yates, Jr., Esq .LAW OFFICES OF ALFRED G . YATES, JR.519 Allegheny Building429 Forbes AvenuePittsburgh, PA 1521 9
Ronald A . Marron, Esq .MARRON & WILSON, LLP1475 Sixth Avenue , Suite 301San Diego , CA 9210 1
Proof of Service 3 Master Case No . OI-CV-0205 L(CGA)