US District Judge John Adams of the US District Court for the Northern District of Ohio ruled that the plaintiffs had not proven their allegations that Goodyear made false and misleading statements, or omitted important information relating to its financial results, according to a news report on the Cantonrep.com Web site. The company’s actions came in press releases, conference calls with securities analysts and SEC filings, the plaintiffs charged.
Still pending before Adams are Goodyear requests to similarly dismiss companion cases including an Employee Retirement Income Security Act (ERISA) suit alleging that one motive for the company to pump up its share price was to help it finance its underfunded pension obligations, the news report said.
Goodyear said in a Web statement that it welcomed the Adams ruling. “We are pleased that the Court has dismissed the lawsuit, which we have always believed to be without merit,” said C. Thomas Harvie, Goodyear senior vice president and general counsel.
Goodyear revealed in October 2003, that accounting system errors forced it to lower net income since 1998 by as much as $100 million. The lawsuit argued the amount was about $280 million. In August, the Securities and Exchange Commission (SEC) told Goodyear that the SEC staff expected to recommend enforcement action against Goodyear for accounting errors disclosed two years previously.
Goodyear blamed the mess on a computerized accounting system implemented in 1999 which it said caused errors with its internal billing system and resulted in the mistakes.