Judge Tosses Out High-Tech Investor Suit

An investor class-action suit against the founder of Everex Systems Inc. was thrown out by a federal judge in San Francisco after three weeks of trial, an encouraging sign for companies besieged with such suits when their stock prices fall. U.S. District Judge Charles Legge dismissed the suit after the close of the plaintiffs’ half of the case, ruling that no reasonable jury could find that then-Chief Executive Steven Hui had control over three quarterly reports that the shareholders claimed were fraudulently optimistic. Hundreds of such suits are filed yearly in California. The Everex case was filed before Congress made it more difficult for investors to win securities fraud suits in federal court. The Fremont-based computer company itself was dropped as a defendant after it filed for bankruptcy reorganization.