US Class Action Accuses NTL of Misleading Investors

23 April 2002

UK-based cable operation NTL, whose shares were until recently quoted on the New York Stock Exchange, is on the receiving end of a class action lawsuit from disgruntled investors.

The move came just days after the ailing cable giant last week won an eleventh hour reprieve from insolvency by agreeing with bondholders a $500 million (€563.22m; £346.21m) debt-for-equity swap.

The lawsuits, filed by law firms Milberg Weiss Bershad Hynes & Lerach of New York and Connecticut-based Scott & Scott, allege that NTL misled investors with data it issued on operating performance, the funding gap and its customer churn rate – an accusation NTL on Monday described as “without merit” and which would not adversely affect it restructuring plans.

In addition, both suits claim that NTL delayed making an $11bn write-down, leading to a total loss of $15.8bn in 2001.

Data sourced from: Financial Times; additional content by WARC staff