Miller v. Thane International, Inc.

Memorandum of Decision

This matter came on for trial before the Court on the plaintiffs’ single claim for violation of Section 12(a)(2) of the Securities Act of 1933, 15 U.S.C. § 771 (a)(2): misrepresentation in connection with a securities offering. On October 27, 2004, the Court certified this case as a class action, and confirmed Joseph J. Milkowski (“Mil-kowski”) as the named class representative. (Minute Order, Oct. 27, 2004, pp. 3-5.)

The context of this case is a merger transaction in which the shareholders of Reliant Interactive Media Corp. (“Reliant”) received shares of Thane International, Inc. (“Thane”). Milkowski and his class members contend that the prospectus distributed to Reliant shareholders contained a material misstatement of fact because Thane did not list its stock on the NASDAQ National Market System (“NMS”) following the merger, notwithstanding numerous alleged representations to the contrary. Plaintiff seeks to recover against Thane and against its officers and directors as “control persons” under Section 15 of the 1933 Act (15 U.S.C. § 77o).

I. Background.

The following background facts are drawn from the substantial factual stipulations which the…