Eaton Corporation Investor Update in Lawsuit: Defendants file Motion to Dismiss

Aug. 31, 2011 - PRLog -- A lawsuit filed by an investor in NYSE-ETN shares filed against certain directors and officers of Eaton Corp. over alleged breaches of fiduciary duties is pending in State Court and the defendants recently filed a motion to dismiss the case. However the court has so far not ruled on that motion and the case is still pending.

If you are a current long term investor in shares of Eaton Corporation (NYSE ETN), you have certain options and you should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

According to the complaint the plaintiff alleges that conduct by the defendants has resulted in Eaton Corp. having to unnecessarily forfeit the recovery of valuable corporate assets due to sanctions related to a lawsuit initiated as a result of an alleged theft of trade secrets estimated to have a value to Eaton Corp of up to $1billion.

The plaintiff claims that back in 2002 six employees left Eaton Corp to join competitor Frisby Aerospace and without authorization, these employees wrongfully took thousands of pages of documents containing trade secrets and proprietary information relating to hydraulic pumps, motors and other products developed by Eaton Corp.
Subsequently in 2004 Eaton Corp filed a lawsuit against Frisby Aerospace and the former Eaton Corp. employees alleging theft and conspiracy. However Eaton Corporation received between 2004 and late 2006 a series of unfavorable rulings from the judge presiding over the trade secret litigation. Then in late 2006 Eaton Corp. hired an attorney to work on behalf of the company. As it turned out, so the plaintiff, the attorney did not enter an appearance in the litigation and his involvement was kept secret from Frisby Aerospace and its counsel. Nevertheless, so the plaintiff, this attorney became involved on behalf of Eaton Corp and the judge’s rulings turned in favor of Eaton Corp.

By late January 2008, so the plaintiff, it was publicly reported that an investigation into the relationship between this attorney and judge was being widened to encompass possible improprieties in the lawsuit by Eaton Corp against Frisby Aerospace. The judge eventually recused himself from that litigation and a new judge was assigned, who determined and ruled that Eaton Corp had retained the attorney to improperly influence the former presiding judge.
The plaintiff alleges that certain officers directly participated in the attorney’s improper contracts with the former presiding judge and certain directors either consciously knew of the certain officers’ improper involvement of the attorney and failed to stop it, or they knowingly abdicated their fiduciary duties.

NYSE- ETN shares traded during February as high as $56.22 and in April as high as $55.91 per share, but fell to recently as low as $37.83 per share on August 22, 2011.

Those who are current long term investors in shares of Eaton Corporation (Public, NYSE-ETN), and/or those who have any information relating the investigation, have certain options and should contact the Shareholders Foundation at mail@shareholdersfoundation.com or call +1(858) 779 - 1554.

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