Abstract

Late last month, the Securities & Exchange Commission (SEC) sued Boca Raton, Fla.-based W.R. Grace and former company executives alleging the specialty chemicals company deceived shareholders by manipulating earnings over a five-year period. The complaint, filed in U.S. District Court for the Southern District of Florida, in Miami, alleges that between 1991 and 1995 Grace deferred some income earned during better years from its National Medical Care kidney dialysis unit to show consistent earnings growth during leaner years. Grace spun off National Medical to Germany's Fresenius in 1996. The alleged practice is a violation of the antifraud, reporting, and books and records provisions of the Securities Exchange Act of 1934, according to SEC. It is seeking unspecified fines from Grace and an injunction restraining and former officials from future violations. In a statement issued after SEC filed its case, Grace said it intends to vigorously contest the allegations of fraud, and does not ...

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