On July 31, 2014, L-3 announced preliminary results for its second quarter of 2014 and that it was conducting an internal review into accounting matters at its Aerospace Systems segment. The Company disclosed that it expects to incur an aggregate pre-tax charge of $84 million against operating income and a related reduction in net sales of approximately $43 million, and of these charges, approximately $50 million relates to periods prior to 2014, and approximately $34 million relates to the first half of 2014. Additionally, as a result of the review, L-3 lowered its estimated operating income for the Aerospace Systems segment by approximately $35 million for the second half of 2014. According to L-3, the adjustments primarily relate to contract cost overruns that were inappropriately deferred and overstatements of net sales, in each case with respect to a fixed-price maintenance and logistics support contract. L-3 revealed that “the amounts associated with these adjustments are the result of misconduct and accounting errors at the Aerospace Systems segment.”On this news, the price of L-3 stock fell $14.68 per share, or 12.27%, from its previous closing price of $119.64 on July 30, 2014, to close at $104.96 per share on July 31, 2014, on extraordinarily heavy trading volume. About Lieff Cabraser Lieff Cabraser Heimann & Bernstein, LLP, with offices in San Francisco, New York, and Nashville, is a nationally recognized law firm committed to advancing the rights of investors and promoting corporate responsibility. The National Law Journal has recognized Lieff Cabraser as one of the nation's top plaintiffs’ law firms for eleven years. In compiling the list, the National Law Journal examines recent verdicts and settlements and looked for firms “representing the best qualities of the plaintiffs' bar and that demonstrated unusual dedication and creativity.” Best Lawyers and U.S. News have also named Lieff Cabraser as a “Law Firm of the Year” each year the publications have given this award to law firms. For more information about Lieff Cabraser and the firm’s representation of investors, please visit http://www.lieffcabraser.com. This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
The law firm of Lieff Cabraser Heimann & Bernstein, LLP announces that class action litigation has been brought on behalf of those who purchased or otherwise acquired the securities of L-3 Communications Holdings, Inc. (“L-3” or the “Company”) (NYSE: LLL) between April 25, 2013 and July 30, 2014, inclusive (the “Class Period”). If you purchased or otherwise acquired L-3 securities during the Class Period, you may move the Court for appointment as lead plaintiff by no later than September 30, 2014. A lead plaintiff is a representative party who acts on behalf of other class members in directing the litigation. Your share of any recovery in the action will not be affected by your decision of whether to seek appointment as lead plaintiff. You may retain Lieff Cabraser, or other attorneys, as your counsel in the action. L-3 investors who wish to learn more about the action and how to seek appointment as lead plaintiff should click here or contact Sharon M. Lee of Lieff Cabraser toll-free at 1-800-541-7358. Background on the L-3 Securities Class Litigation The action charges L-3 and certain of its senior officers with violations of the Securities Exchange Act of 1934. L-3 is a prime contractor in aerospace systems and national security solutions. L-3 also provides communication and electronic systems and products used on military and commercial platforms. The complaint alleges that throughout the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) L-3’s financial statements contained errors related to the improper deferral of cost overruns on a fixed-price maintenance and logistics support contract that resulted in overstatement of operating income; (2) L-3’s net sales with respect to the fixed-price maintenance and logistics support contract were overstated; and (3) the Company lacked adequate internal controls over financial reporting.