Stull, Stull & Brody Announces Class Action Against Great Atlantic & Pacific Tea Company, Inc

Business Wire, June 18, 2002

Business Editors

NEW YORK--(BUSINESS WIRE)--June 18, 2002

Notice is hereby given that a class action lawsuit was filed on June 17, 2002 in the United States District Court for the District of New Jersey, on behalf of purchasers of the securities of Great Atlantic & Pacific Tea Company, Inc. ("Great Atlantic" or the "Company") (NYSE:GAP) between November 15, 2001 and May 28, 2002, inclusive (the "Class Period") against defendants Great Atlantic & Pacific Tea Company, Inc., and the following of its principal officers and directors: Christian W.E. Haub, Elizabeth Culligan, Fred Corrado, Mitchell Goldstein and Kenneth A. Uhl.

The complaint alleges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between November 15, 2001 and May 28, 2002, thereby artificially inflating the price of Great Atlantic securities. Throughout the Class Period, as alleged in the complaint, defendants issued statements regarding Great Atlantic's quarterly and annual financial performance and filed reports confirming such performance with the United States Securities and Exchange Commission ("SEC"). The complaint alleges that these statements were materially false and misleading because, among other things, (i) the Company was employing improper accounting practices regarding the Company was employing improper accounting practices regarding the recognition of vendor allowances and the accounting of inventory in certain of its regions for fiscal year 2001 in violation of Generally Accepted Accounting Principles. As a result, the Company's operating results were materially misrepresented and overstated; and (ii) based on the foregoing, defendants' statements concerning the prospects of Great Atlantic were lacking in a reasonable basis at all times.

On May 28, 2002, the last day of the Class Period, the Company announced that it would delay the filing of its annual report with the SEC while it conducted an accounting review which will most likely result in a charge to earnings. The accounting review will focus on the appropriate timing for the recognition of vendor allowances and the accounting of inventory in certain of the Company's regions for fiscal year 2001. Great Atlantic further noted that a substantial portion of any charge the Company will take will reverse credits which were recognized prematurely as reductions of cost of merchandise sold, and that portion will therefore be recognized in periods subsequent to fiscal 2001 as reduction of cost of merchandise sold. Following this disclosure, Great Atlantic stock fell $4.03 per share, or approximately 16%, to close on May 28, 2002 at $21.070 per share.

If you purchased Great Atlantic common stock between November 15, 2001 and May 28, 2002, inclusive, you may, no later than August 2, 2002, request the Court appoint you as lead plaintiff.

A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Stull, Stull & Brody, or other counsel of your choice, to serve as your counsel in this action.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Tzivia Brody, Esq. at Stull, Stull & Brody by calling toll-free 1-800-337-4983, or by e-mail at SSBNY@aol.com, or by fax at 212/490-2022, or by writing to Stull, Stull & Brody, 6 East 45th Street, New York, NY 10017.