Shares of ITT Educational Services ( ESI) dropped again Wednesday, after the company said it can no longer back its forecast for full-year 2004 earnings estimates because of a federal investigation of the company by the Department of Justice. "In light of the pending federal grand jury investigation of the company and resulting shareholder class-action lawsuits, the company is not able to confirm the internal goals and other projections for the company's 2004 fiscal year that were previously disclosed," the company said in a Form 8-K filed with the Securities and Exchange Commission. In October, the company had forecast 2004 earnings of $1.46 to $1.50 a share on a revenue increase of 14% to 17%. Analysts had expected $1.60 a share. The company earned $1.23 a share in the previous year. Shares of ITT were lately down $1.65, or 4.5%, at $34.87. The stock is currently off about 40% from its Feb. 24 closing price of $57.40, which was the day before news of the federal investigation broke. Speaking at Merrill Lynch's 7th Annual Advertising/Marketing, Education & Information Conference, ITT's Chief Executive Rene R. Champagne said that investigators had wanted documents about student metrics as well as information about the company's personnel, including himself, a Dow Jones Newswires report said. Meanwhile, ITT reported that three of its senior officers were named as defendants in a class-action lawsuit filed on Feb. 26 in a southern Indiana U.S. District Court. "The complaint alleges, among other things, that the defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b- 5 promulgated thereunder, by employing devices, schemes and artifices to defraud, making untrue statements of material fact and/or omitting to state material facts necessary to make statements not misleading and engaging in acts, practices and a course of business which operated as a fraud and deceit on the purchasers of ITT/ESI's securities in an effort to maintain artificially high market prices for its stock," ITT said in a statement.