Spector & Roseman, P.C. Announces Class Action Lawsuit Filed Against Rite Aid Corporation and Its Chairman and CEO On Behalf of All Purchasers of Rite Aid Corporation Common Stock

Business Wire, April 2, 1999

PHILADELPHIA--(BUSINESS WIRE)--April 2, 1999--Spector & Roseman, P.C. announces that a class action has been filed in the United States District Court for the Eastern District of Pennsylvania on behalf of persons who purchased the common stock of Rite Aid Corporation ("Rite Aid") (NYSE: RAD) between December 14, 1998 and March 11, 1999 (the "Class Period").

The complaint alleges that Rite Aid and its Chairman and CEO, Martin L. Grass, violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The Complaint charges that Rite Aid issued a series of materially false and misleading statements concerning Rite Aid's operating results and business prospects. Because of the issuance of these false and misleading statements, the price of Rite Aid common stock was artificially inflated during the Class Period.

The Complaint alleges defendants hid the fact that the costs of store openings and closings were far greater than Rite Aid led the investing public to expect, that there were software start up problems at its new distribution center, that the implementation of a revised merchandising strategy would lead to markdowns that would negatively impact earnings, and that the early closing of the PCS Health Systems acquisition would contribute to a fourth quarter earning shortfall.

On March 12, 1999, Rite Aid shocked the market by announcing its true operating results and business prospects, and that earnings for the fourth quarter ended February 28, 1999 would be approximately $.30 to $.32 per share, well below Wall Street expectations of $.52 per share. This revelation caused the price of Rite Aid common stock to plummet $14 7/16 per share to $22 9/16 per share - a plunge of more than 39% - on an enormous volume of 47 million shares. Plaintiffs seek to recover damages on behalf of all purchasers of Rite Aid common stock during the Class Period. The plaintiffs are represented by the law firm of Spector & Roseman, P.C., who have expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Spector & Roseman, P.C., located in Philadelphia, Pennsylvania and San Diego, California, concentrates its practice in complex litigation including actions dealing with securities laws, antitrust, contract and commercial claims. The firm is active in major litigation pending in federal and state courts throughout the United States. The firm's reputation for excellence has been recognized on repeated occasions by courts which have appointed the firm as lead counsel in numerous major class actions involving violations of the federal securities laws and the federal antitrust laws. As a result of the efforts of the firm, and its members, hundreds of millions of dollars have been recovered on behalf of thousands of defrauded shareholders and companies.

The Firm is currently representing investors as lead counsel in actions against S3, Inc., Altris Software, Dreyfus Aggressive Growth Fund, Mitcham Corporation, Vivus, Inc., and Zapata Corporation. The firm is currently representing businesses as lead counsel in the following antitrust actions: In re Flat Glass Antitrust Litigation; In re Linerboard Antitrust Litigation.

If you are a member of the Class described above, you may, no later than sixty days from March 15, 1999, move the Court to serve as lead plaintiff of the Class, if you so choose. In order to serve as lead plaintiff, however, you must meet certain legal requirements.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel Robert M. Roseman or Howard C. Gottlieb toll free at 888/844-5862 or via E-mail at classaction@spectorandroseman.com. For more detailed information about the firm please visit our website at http://www.spectorandroseman.com.

SOURCE: Spector & Roseman