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Darland True Facts re: digital suit and who paid up

Saturday, May 15, 1993 - Page updated at 12:00 AM

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Digital Reaches Pact With Shareholders


By John H. Stevens

Digital Systems International Inc. said yesterday it settled a shareholders' lawsuit for $7.7 million, charging $4.1 million of the settlement against its first-quarter earnings, resulting in a net loss for the quarter. The out-of-court settlement calls for the Redmond company to pay some 2,000 shareholders $5.5 million in cash and 444,000 shares of Digital common stock worth about $2.3 million. "I thought it was a great settlement," said Steve Berman, an attorney for the shareholders. Digital officials did not return phone calls yesterday, but in a prepared statement the company's chairman and chief executive, Michael Darland, said a lengthy trial was avoided that would have been distracting to Digital management. "We believe this settlement is an appropriate resolution which has enabled us to limit the risks involved in presenting a complex case to a jury and to limit ongoing legal expenses," Darland said. Digital manufactures computerized telephone dialing systems. The settlement charge against earnings gave the company a $2.7 million after-tax loss in its first quarter, or $0.29 per share. Digital's stock was unchanged yesterday, closing at $5.25 per share. The class action suit was filed against Digital and its officers in federal court in Seattle in November 1991, two months after its stock plunged 42 percent in one day. The suit claimed Digital officers did not adequately spell out the risks of its business to shareholders who bought the stock between Oct. 25, 1990, and Sept. 11, 1991. The stock fell from $16.25 to $9.75 on Sept. 12, 1991, after the company announced lower than expected earnings. After the suit was filed, Darland denied any wrongdoing. Berman said the shareholders in the suit may elect to sell the stock portion of the settlement and take cash instead. The settlement is subject to approval by a trial judge. Stockholders will have the option of approving the settlement or bringing their own civil cases against Digital.
Copyright (c) 1993 Seattle Times Company, All Rights Reserved.

If, according to Darlands answers under oath to interrogatories, insurance paid most of settlement amount of $7- $8 million, why would the company suffer a loss?

Digital Systems trims costs, staff after lawsuit. (Digital Systems International Inc.)

Puget Sound Business Journal


| May 21, 1993 | Baker, M. Sharon | Copyright

Two days after Digital Systems International Inc. announced it had reached a negotiated settlement of $7 million in a shareholder lawsuit, the Redmond company laid off 31 employees. The company, which makes computerized call processing systems, also mandated a one-week leave without pay for its remaining 370 employees, eliminated bonus pay and cut two weeks' pay for senior executives. The cuts were made to ensure the company operates profitably, said Michael Darland, president and founder.

If insurance paid most of settlement amount of $7- $8 million, why would Darland have had to resort to such drastic measures?
Publication: Business Wire Date: Tuesday, April 9 1996 You are viewing page 1

REDMOND, Wash.--(BUSINESS WIRE)--April 9, 1996--DSI today announced that Michael Darland, founder of Digital Systems, has resigned as a member of the board of directors. Darland served as the company's president and chief executive officer until November 1994 and chairman of the board until July 1995. Darland's personal business interests in South America have consumed nearly all of his time since mid-1995 resulting in limited attention to company matters and inconsistent board and committee meeting attendance. No replacement director has been named by the company. "The drive and vision that Michael Darland brought to Digital Systems has been transferred to new projects outside the industry he helped build," said Pat Howard, chairman, president and chief executive officer of DSI. "We wish Michael success in his new endeavors equal to his success with DSI." DSI is a global leader in providing customer management solutions that help create, build and improve profitable relationships between companies and their customers. The company has more than 900 installations worldwide, supporting customer serving strategies in major financial institutions, utilities, telecommunications companies, educational and government centers, health care and nonprofit organizations. With headquarters in Redmond, DSI has offices in Wilmington, Chicago, Atlanta and the United Kingdom, and Value Added Resellers in major cities in North America, Asia, Australia, South America and Europe. CONTACT: Digital Systems International, Redmond John Flavio, 206/556-8088

Darland was so traumatized by the possible charges of perjury and coercion and possibility od othe law suits by shareholders that Daland took his money and RAN to South America! Let us see where we can make Darland run to this time?

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