Milberg Weiss Files New Class Action On Behalf of Purchasers of Network Associates Inc. Stock Between January 20, 1998 and April 19, 1999

Business Wire, April 22, 1999

SAN DIEGO--(BUSINESS WIRE)--April 21, 1999--

Milberg Weiss today announced that a new class action has been commenced in the United States District Court for the Northern District of California on behalf of purchasers of Network Associates, Inc. ("Network Associates") (Nasdaq:NETA) common stock during the period between Jan. 20, 1998 and April 19, 1999 (the "Class Period"), including those persons who received shares of Network Associates in exchange for the American Depository Receipts ("ADR's") of Doctor Solomon's Group PLC (Nasdaq:SOLLY) (EASDAQ:SOLL), in connection with Network Associates' acquisition of Doctor Solomon's on August 13, 1998.

On April 19, 1999, Network Associates announced that dealer inventories were so bloated that sales would drop significantly. The complaint charges Network Associates and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that during the Class Period, the defendants issued numerous false statements about Network Associates, its financial results and its business prospects, including that the Company was experiencing strong pricing trends, its business was healthy, its outlook had never been better and, as a result, it would earn EPS of $2.12 in 1999, respectively. These false statements caused Network Associates stock to trade at artificially inflated levels of as high as $67 per share in December 1998 and kept it trading at over $30 per share through the end of the Class Period, enabling several executive officers of Network Associates to sell over 852,500 shares of Network Associates stock at artificially inflated prices ranging from $34.33 to $50.88, for almost $33 million.

However, it was only after these stock sales occurred that the defendants revealed that Network Associates' accounting procedures may be improper. On January 6, 1999, Network Associates revealed that it had received a letter from the Securities and Exchange Commission questioning the Company's accounting practices in the Company's SEC filings made during 1998.

Then, in stark contrast to the defendants' statements during the Class Period, the defendants admitted after the close of the market on April 6, 1999 that, in connection with the SEC's investigation, Network Associates had determined that: its in-process research and development expenditures were overstated by $45 million in 1997; its amortization expenses were materially understated in 1997; its in-process research and development expenditures were overstated by $169 million in 1998; its amortization expenses were materially understated in 1998; and its amortization expense for 1Q99 would increase to $58 million from planned expense of $22 million.

Even worse, on April 19, 1999, defendants admitted that dealer inventory was so bloated that sales would drop significantly causing Network Associates stock to drop another 27% to $11-1/16.

Plaintiff seeks to recover damages on behalf of all purchasers of Network Associates common stock during the Class Period (the "Class"). The plaintiff is represented by Milberg Weiss Bershad Hynes & Lerach LLP, who have expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Milberg Weiss has been actively engaged in commercial litigation, emphasizing securities and antitrust class actions, for more than 30 years. The firm has offices in New York, San Diego, San Francisco, Los Angeles and Boca Raton and 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 to major positions in complex multi-district or consolidated litigations. Milberg Weiss has taken a lead role in numerous important actions on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total approximately $2 billion. Visit the firm's Web site at http://www.milberg.com.

If you are a member of the Class described above, you may, no later than 60 days from April 7, 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 plaintiffs' counsel, William Lerach, Alan Schulman or Darren Robbins of Milberg Weiss at 800/449-4900 or via e-mail at wsl@mwbhl.com.