Catalina Marketing Corp. continued to get slapped with shareholder lawsuits last week, even as its stock inched up after hitting a 52-week low of $12.58 on Aug. 26.
Wolf Haldenstein Adler Freeman & Herz filed a class-action suit Sept. 2 in Florida, alleging the St. Petersburg, Fla., in-store promotions company misrepresented revenue and earnings growth.
After the market closed Aug. 25, Catalina said its independent auditors had resigned over accounting issues. According to a Catalina statement, Ernst & Young questioned the company's recognition and timing of revenue generated by its health-resource and manufacturer-services units; the timing of the accounting treatment of its customer arrangements in those divisions; Catalina's accounting treatment of certain non-cash transactions in its retail services unit; and its disclosure of segment information for financial reporting.
Catalina, which is seeking a new auditor, said in the statement that it continues to evaluate those issues and the impact of E&Y's findings of "reportable events." Catalina also said it would delay filing its 10-K annual report for the fiscal year ended March 31 and its 10-Q report for the first quarter of fiscal 2004.
In a statement last month, the company acknowledged the earlier filing of other class action lawsuits. "They're meritless, and we'll work hard to defend ourselves," said a Catalina rep. She declined further comment.