Judge Dismisses Stock Fraud Suit Against Zale

Law360, New York (August 1, 2011, 4:25 PM EDT) -- A Texas federal judge on Monday threw out a shareholder's putative class action accusing jewelry retailer Zale Corp. of securities fraud in connection with a $19.4 million accounting restatement.

U.S. District Judge Jane L. Boyle said accounting problems that led to the restatement were more likely caused by an executive trying to meet her department budget than a deliberate fraud. Zale and its officers could not be held liable for the accounting issues under federal securities fraud laws, she said.

“Ordinary negligence or even gross negligence...
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