Howard T. LongmanSTULL STULL & BRODY6 East 45th StreetNew York, New York 10017Tel : (212) 687-723 0Fax : (212) 490-2022

Gary S. Graifman (GSG 2276)KANTROWITZ , GOLDHAME R& GRAIFMAN, P.C.

747 Chestnut Ridge RoadChestnut Ridge, New York :L0077Tel : (845) 356-257 0Fax : (845)356-4335

Attorneys for Plaintiff

UNITED STATES DISTRICT COURTFOR THE EASTERN DISTRICT OF NEW YORK

HARRIET BERNSTEIN ,

V.

Plaintiff,

CORTS TRUST FOR PROVIDENT FINANCINGTRUST I, PROVIDENT FINANCING TRUST I,UNUMPROVIDENT CORP ., J . HAROLDCHANDLER, ROBERT GREYING, SALOMONSMITH BARNEY and CITIGROUP INC . ,

Defendant .

a 03 32 8 2FILE D

U .5 (?r,a'r 12!(:; f' ;f~uF t .0 N .Y

JUL 1 fO3F 01(L_YN Oi ;E.

'7L EE N J

AZRAiCK,CIVIL ACTION NQ .

CLASS ACTION COMPLAINTFOR VIOLATIONS OFFEDERAL SECURITIES LAW S

JURY TRIAL DEMANDE D

Plaintiff, Harriet Bernstein, herein alleges the following based upon investigation of he r

counsel, including a review of United States Securities and Exchange Commission ("SEC")

filings, regulatory filings and reports, securities analysts' reports and advisories, media reports,

press releases and other public statements issued by defendants, and plaintiff believes that

substantial additional evidentiary support will exist for the allegations set forth herein after a

reasonable opportunity for discovery.

NATURE OF THE ACTIO N

i . This is a federal class action on behalf of persons buying UnumProviden t

Corporate-Backed Trust Securities ("CorTS") Certificates pursuant or traceable to an initial

public offering on or about January 31, 2001 through March 24, 2003, inclusive (the "Class

Period"), seeking to pursue remedies under the Securities Act of 1933 (the "Securities Act") an d

the Securities Exchange Act of 1934 (the "Exchange Act") .

JURISDICTION AND VENU E

2 . The claims asserted herein arise under Section 11 of the Securities Act an d

Sections 10(b) and 20(a) of the Exchange Act [15 U .S.C. §§ 78j(b) and 78t(a)] .

3 . This Court has jurisdiction over the subject matter of this action pursuant to 28

U.S.C. §§ 1331 and 1337 and Section 27 of the Exchange Act [15 U .S.C. § 78aa] .

4 . Venue is proper in this District pursuant to Section 27 of the Exchange Act, an d

28 U .S .C. § 1391(b), as many of the acts and practices complained of herein occurred i n

substantial part in this District, and the plaintiff resides in the District .

5 . In connection with the acts alleged in this complaint, defendants , directly or

indirectly, used the means and instrumentalities of interstate commerce, including, but no t

limited to, the mails, interstate telephone communications and facilities of the nationa l

securities markets .

PARTIE

6 . Plaintiff Harriet Bernstein, as set forth in the accompanying certification,

incorporated by reference herein, purchased defendant-issued certificates at artificially inflate d

prices during the Class Period and has been damaged thereby . At all times relevant herein ,

plaintiff Bernstein resided in the County of Kings, State of New York in this District .

2

7. Defendant CorTS Trust for Provident Financing Trust I ("CorTS Trust I" or the

"Trust") is a New York business trust established to buy 7 .405% Capital Securities from

Defendant Provident Financing Trust I and to sell 8 .5% Corporate-Backed Trust Securitie s

Certificates to the public . 1

8. Defendant Provident Financing Trust I is a Delaware business trust established t o

buy 7 .405% Junior Subordinated Deferrable Interest Debentures, Series A, from Defendan t

UnumProvident Corp ., and to sell 7 .405% Capital Securities to Defendant CorTS Trust .

9 . Defendant UnumProvident Corp . ("Provident" or the "Company"), previousl y

known as Provident Companies, Inc ., is and was, at all relevant times hereto, a corporation

organized and existing under the laws of the State of Tennessee, with its principal offices in

Chattanooga, Tennessee . The Company, through its subsidiaries, is a provider of group and

individual disability insurance . It also provides a complementary portfolio of other insurance

products, including long-term care insurance, life insurance, employer- and employee-paid

group benefits and related services .

10. Defendant J . Harold Chandler ("Chandler") served during the Class Period, an d

at all times relevant hereto, as UnumProvident's Chief Executive Officer .

11. Defendant Robert Greying ("Greying") served during the Class Period, and at al l

times relevant hereto, as UnumProvident's Chief Financial Officer .

12 . Defendants Chandler and Greying, collectively, are referred to herein as th e

"Individual Defendants ."

13 . Because of the Individual Defendants' positions with the Company, they ha d

access to the adverse undisclosed information about the Company's business, operations,

operational trends, financial statements, markets, and present and future business prospects

3

via access to internal corporate documents (including the Company's operating plans, budgets

and forecasts, and reports of actual operations compared thereto) ; conversations and

connections with other corporate officers and employees ; attendance at management and

Board of Directors meetings and committees thereof and via reports and other information

provided to them in connection therewith .

14 . It is appropriate to treat the Individual Defendants as a group for pleading

purposes and to presume that the false, misleading and incomplete information conveyed in the

Company's public filings, press releases, and other publications as alleged herein are the

collective actions of the narrowly defined group of defendants identified above . Each of the

above officers of UnumProvident, by virtue of their high-level positions with the Company,

directly participated in the management of the Company, were directly involved in the day-to-

day operations of the Company at the highest levels, and were privy to confidential proprietary

information concerning the Company and its business, operations, growth, financial statements,

and financial condition, as alleged herein . Said defendants were involved in drafting,

producing, reviewing and/or disseminating the false and misleading statements and information

alleged herein, were aware, or recklessly disregarded, that the false and misleading statements

were being issued regarding the Company, and approved or ratified these statements, in

violation of the federal securities laws .

15. As officers and controlling persons of a publicly-held company whose commo n

stock was, and is, registered with the SEC pursuant to the Exchange Act, and was traded on

the New York Stock Exchange ("NYSE"), and governed by the provisions of the federal

securities laws, the Individual Defendants each had a duty to disseminate promptly, accurate

and truthful information with respect to the Company's financial condition and performance ,

4

1-1 •growth, operations, financial statements, business, markets, management, earnings and

present and future business prospects, and to correct any previously-issued statements that

had become materially misleading or untrue, so that the market price of the Company's

publicly-traded securities would be based upon truthful and accurate information . The

Individual Defendants' misrepresentations and omissions during the Class Period violated these

specific requirements and obligations .

16 . The Individual Defendants pa rt icipated in the drafting , preparation , and/or

approval of the various public and shareholder and investor reports and other communication s

complained of herein and were aware of, or recklessly disregarded, the misstatements

contained therein and omissions therefrom, and were aware of their materially false an d

misleading nature . Because of their Board membership and/or executive and manageria l

positions with UnumProvident, each of the Individual Defendants had access to the adverse

undisclosed information about UnumProvident's business prospects and financial condition an d

performance as particularized herein and knew (or recklessly disregarded) that these advers e

facts rendered the positive representations made by or about UnumProvident and its busines s

issued or adopted by the Company materially false and misleading .

17 . The Individual Defendants, because of their positions of control and authority as

officers and/or directors of the Company, were able to and did control the content of the

various SEC filings, press releases and other public statements pertaining to the Company

during the Class Period . Each Individual Defendant was provided with copies of the document s

alleged herein to be misleading prior to or shortly after their issuance and/or had the ability

and/or opportunity to prevent their issuance or cause them to be corrected . Accordingly, each

of the Individual Defendants is responsible for the accuracy of the public reports and release s

5

0

detailed herein and is therefore primarily liable for the representations contained therein .

18. Defendant Salomon Smith Barney is a wholly-owned subsidiary of defendan t

Citigroup Inc . Collectively, Salomon Smith Barney and Citigroup are referred to herein as

"Salomon Smith Barney" or the "Underwriter Defendant ." Salomon Smith Barney served as

lead underwriters of the CorTS offering and helped orchestrate the Offering, including writing

the false Registration Statement/Prospectus .

PLAINTIFFS' CLASS ACTION ALLEGATION S

19. Plaintiff brings this action as a class action pursuant to Federal Rule of Civi l

Procedure 23(a) and (b)(3) on behalf of a Class, consisting of all those who purchased o r

otherwise acquired CorTS Certificates pursuant or traceable to an initial public offering on o r

about January 31, 2001 through March 24, 2003, inclusive (the "Class Period") and who were

damaged thereby . Excluded from the Class are defendants , the officers and directors of the

Company, at all relevant times, members of their immediate families and their lega l

representatives, heirs, successors or assigns, and any entity in which defendants have or had a

controlling interest.

20. The members of the Class are so numerous that joinder of all members i s

impracticable . Throughout the Class Period , CorTS Trust Certificates were actively traded o n

the NYSE . While the exact number of Class members is unknown to plaintiff at this time an d

can only be ascertained through appropriate discovery, plaintiff believes that there are

hundreds or thousands of members in the proposed Class . Record owners and other members

of the Class may be identified from records maintained by UnumProvident or its transfer agen t

and may be notified of the pendency of this action by mail, using the form of notice similar to

that customarily used in securities class actions .

6

1]21. Plaintiffs claims are typical of the claims of the members of the Class, as al l

members of the Class are similarly affected by defendants' wrongful conduct in violation of

federal law that is complained of herein .

22. Plaintiff will fairly and adequately protect the interests of the members of th e

Class and has retained counsel competent and experienced in class and securities litigation .

23. Common questions of law and fact exist as to all members of the Class and

predominate over any questions solely affecting individual members of the Class . Among the

questions of law and fact common to the Class are :

(a) whether the federal securities laws were violated by defendants' acts as allege d

herein ;

(b) whether statements made by defendants to the investing public during the Clas s

Period misrepresented material facts about the business, operations, and managemen t

of UnumProvident ; and

(c) to what extent the members of the Class have sustained damages and the

proper measure of damages .

24 . A class action is superior to all other available methods for the fair and efficien t

adjudication of this controversy since joinder of all members is impracticable. Furthermore, as

the damages suffered by individual Class members may be relatively small, the expense an d

burden of individual litigation make it impossible for members of the Class to individually

redress the wrongs done to them . There will be no difficulty in the management of this actio n

as a class action .

SUBSTANTIVE ALLEGATION S

25. Defendant UnumProvident Corporation (' UnumProvident" or "the Company") i s

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the parent holding company for a group of insurance and non-insurance companies that

collectively operate throughout the world . The Company, through its subsidiaries, is a provider

of group and individual disability insurance as well as a portfolio of other insurance products,

including long-term care insurance, life insurance, employer- and employee-paid group benefits

and related services .

26 . On January 31, 2001, the Company issued the securities which are the subject o f

this action in the form of 2,090,823 8 .5% Corporate-Backed Trust Securities ("CorTS")

Certificates to the general public through two specially established corporate entities, Provident

Financing Trust I and CorTs Trust for Provident Financing Trust I ("the Trust") . The

Certificates, sold for $25 .00, evidenced the right to receive payments on principal of $28.69 per

Certificate on March 15, 2038, and to receive semiannual interest payments at a rate of 8 .5%

per year .

27 . UnumProvident, which established the Trust and Provident Financing Trust I fo r

the exclusive purpose of issuing preferred securities, guaranteed the payments of distribution s

to the extent that Provident Financing Trust I had funds available . Because the sole assets of

the Trust consisted of securities issued by Provident Financing Trust I, and the sole assets of

Provident Financing Trust I consisted of debentures issued by UnumProvident, payment of th e

Trust relied completely on the Company . The Prospectus Supplement noted as a "Risk Factor"

that "UnumProvident Corporation's Guarantee of Payments due on the Underlying Capita l

Securities will be unsecured and rank subordinate and junior to all senior indebtedness o f

UnumProvident Corporation," emphasizing the Company's importance to the Trust but failing to

disclose that the Company's 2000 financials were materially overstated .

28. On May 11, 2001, UnumProvident filed a quarterly report with the SEC whic h

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included financial results for the first quarter of 2001 . In the Notes to Consolidated Financia l

Statements contained in the 10-Q, defendants represented that :

In the opinion of management, all adjustments (consisting ofnormal recurring accruals) considered necessary for a fairpresentation have been included .

29 . Throughout the Class Period, defendants issued numerous statements and file d

quarterly and annual reports with the SEC which described the Company's increasing ne t

income and financial performance . These statements were materially false and misleadin g

because they failed to disclose and/or misrepresented the following adverse facts, amon g

others: (i) that, throughout the Class Period, the Company was overstating its net income b y

failing to properly record investment impairments ; and (ii) that as a result, the value of th e

Company's net income and financial results were materially overstated at all relevant times .

30 . On February 5, 2003, the price of UnumProvident securities fell when

UnumProvident was forced to announce that it had recorded investment losses of $93 millio n

and that it was responding to SEC requests for information relating to its investmen t

disclosures .

31 . On March 11th, the price of CorTS Certificates fell to close at $14 .00 on investors '

concern over UnumProvident's losses and the negative analyst reports which followed .

32 . On March 24th, the Company announced that it would "restate reported results

which [would] result in a net aggregate income reduction for 2002, 2001 and 2000 of $29 .1

million, consisting of a $34 .2 million increase in previously reported 2002 net income and a

decrease in net income of $38 .0 million and $25 .3 million in 2001 and 2000, respectively . "

33 . The market for the CorTS Certificates was open, well-developed, and efficient a t

all relevant times and said certificates trade on the New York Stock Exchange as a structure d

9

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product under the symbol "KSA ." As a result of these materially false and misleading

statements and failures to disclose, the Certificates traded at artificially inflated prices during

the Class Period . Plaintiff and other members of the Class purchased or otherwise acquired the

Certificates relying upon the integrity of the market price of the Certificates and marke t

information relating to UnumProvident, and have been damaged thereby .

34. During the Class Period, defendants materially misled the investing public ,

thereby inflating the price of the Certificates, by publicly issuing false and misleadin g

statements and omitting to disclose material facts necessary to make defendants' statements,

as set forth herein, not false and misleading . Said statements and omissions were materiall y

false and misleading in that they failed to disclose materially adverse information an d

misrepresented the truth about the Company, its business and operations, as alleged herein .

35 . At all relevant times, the material misrepresentations and omission s

particularized in this Complaint directly or proximately caused or were a substantial contributin g

cause of the damages sustained by plaintiff and other members of the Class . As described

herein, during the Class Period, defendants made or caused to be made a series of materially

false or misleading statements about UnumProvident's business, prospects and operations.

These material misstatements and omissions had the cause and effect of creating in the market

an unrealistically positive assessment of UnumProvident and its business, prospects, an d

operations, thus causing the Company's securities to be overvalued and artificially inflated at al l

relevant times . Defendants ' materially false and misleading statements during the Class Period

resulted in plaintiff and other members of the Class purchasing the Company's securities a t

artificially inflated prices, thus causing the damages complained of herein .

10

FIRST CLAIM

Violations of §11 of The Securities Act of 1933Against All Defendants

36 . Plaintiff repeats and realleges each and every paragraph contained above as i f

set forth herein, except insofar as such might invoke a claim or element of fraud . Allegations of

fraudulent conduct or reckless conduct are expressly excluded from this claim . This claim is

asserted against UnumProvident, CorTS Trust, Provident Financing Trust I, the Underwriter

Defendant and the Individual Defendants .

37. This Count is brought pursuant to §11 of the 1933 Act, 15 U .S .C . §77k, on behal f

of plaintiff and the Class .

38. The registration statement and prospectuses referenced herein including thos e

prospectuses published by the Underwriters at the direction of UnumProvident (which were not

filed with the SEC) for the Offerings were inaccurate, contained untrue statements of material

fact, omitted to state other facts necessary to make the statements made not misleading and

failed to adequately disclose material facts as described above .

39 . Provident Financing Trust I was issuer of the securities sold through th e

registration statement and prospectuses . As issuer, it is strictly liable to plaintiff and the Clas s

for the material misstatements and omissions contained in the filings detailed above .

40 . The defendants named in this Count, and each of them, issued, caused to b e

issued, and participated in the issuance of materially false written statements to the investin g

public which were contained in the registration statements and prospectuses referenced herein ,

which statements misstated or failed to disclose, interalia, the material facts set forth above .

41 . The defendants named in this Count, with the exception of the issuer (whos e

11

L_J Eliability for the misstatements is absolute ), owed to the purchasers, including plaintiff and the

Class, the duty to make a reasonable and diligent investigation of the statements contained i n

the registration statement and prospectuses at the time they became effective and/or were

publicly distributed, and to reasonably assure that those statements were true and that there

was no omission of material facts required to be stated in order to make the statements

contained therein correct .

42. The Individual Defendants, and each of them, were responsible for the conten t

and dissemination of the registration statement and prospectuses in connection with th e

Offering (as well as for UnumProvident's negligent conduct in connection therewith), and

caused such filing to be made with the SEC . In addition, each of the Individual Defendants wa s

a director or a person performing similar functions as a director of UnumProvident at the tim e

of the filing of the parts of the registration statement complained of herein, and/or was, wit h

his consent, named in the registration statement as a director or a person performing simila r

functions as a director of UnumProvident, and is therefore liable for its contents .

43 . The Individual Defendants prepared the prospectuses negligently and failed to

make a reasonable investigation or possess reasonable grounds for the belief that th e

statements contained in the registration statement and prospectus referenced herein were true,

did not omit any material fact, and were correct . The Individual Defendants , and each of them,

were directors of UnumProvident at such times , and were negligent in that they failed to

exercise reasonable care in ensuring the accuracy and completeness of the registration

statement and prospectuses .

44. As a direct and proximate result of defendants' acts and omissions in violation o f

the Securities Act of 1933, the market price of the Certificates was artificially inflated in th e

12

u ~ .J

Offering made pursuant to the registration statement and prospectuses referenced herein, and

Plaintiff and the Class suffered substantial damage in connection with their purchase and/or

acquisition of the Certificates . By reason of the conduct herein alleged, defendants named in

this Count violated and/or controlled a person who violated §11 of the Securities Act of 1933 .

45. At the times they purchased or otherwise acquired the Certificates, plaintiff an d

the members of the Class were without knowledge of the facts concerning the false statements

or omissions alleged herein and the exercise of due diligence did not come into possession o f

the facts underwriting the violations alleged herein .

SECOND CLAI M

Violation of Section 10(b) of The Exchange Act andRule 10b-5 Promulgated Thereunder Against All Defendants

46. Plaintiff repeats and realleges each and every allegation contained above as i f

fully set forth herein .

47. During the Class Period, defendants carried out a plan, scheme and course of

conduct which was intended to and, throughout the Class Period, did deceive the investing

public, including plaintiff and other Class members, as alleged herein and cause plaintiff and

other members of the Class to purchase the Certificates at artificially inflated prices . In

furtherance of this unlawful scheme, plan and course of conduct, defendants, and each of

them, took the actions set forth herein .

48 . Defendants (a) employed devices, schemes, and artifices to defraud ; (b) made

untrue statements of material fact and/or omitted to state material facts necessary to make th e

statements not misleading ; and (c) engaged in acts, practices , and a course of business whic h

operated as a fraud and deceit upon the purchasers of the Trust's certificates in an effort to

maintain artificially high market prices for the Trust's securities in violation of Section 10(b) o f

13

FJ 0the Exchange Act and Rule 10b-5 . All Defendants are sued either as primary participants in th e

wrongful and illegal conduct charged herein or as controlling persons as alleged below .

49 . Defendants, individually and in concert , directly and indirectly, by the use, means

or instrumentalities of interstate commerce and/or of the mails, engaged and participated in a

continuous course of conduct to conceal adverse material information about the business ,

operations and future prospects of UnumProvident as specified herein .

50 . These defendants employed devices, schemes and artifices to defraud, while i n

possession of material adverse non-public information and engaged in acts, practices, and a

course of conduct as alleged herein in an effort to assure investors of UnumProvident's value

and performance and continued substantial growth, which included the making of, or th e

participation in the making of, untrue statements of material facts and omitting to state

material facts necessary in order to make the statements made about UnumProvident and it s

business operations and future prospects in light of the circumstances under which they wer e

made, not misleading, as set forth more particularly herein, and engaged in transactions,

practices and a course of business which operated as a fraud and deceit upon the purchasers o f

the Trust certificates during the Class Period .

Si . Each of the Individual Defendants' primary liability, and controlling perso n

liability, arises from the following facts: (i) the Individual Defendants were high-level executives

and/or directors at the Company during the Class Period and members of the Company's

management team or had control thereof ; (ii) each of these defendants, by virtue of his

responsibilities and activities as a senior officer and/or director of the Company was privy to

and participated in the creation, development and reporting of the Company's internal budgets,

plans, projections and/or reports ; (iii) each of these defendants enjoyed significant persona l

14

contact and familiarity with the other defendants and was advised of and had access to other

members of the Company's management team, internal reports and other data and information

about the Company's finances, operations, and sales at all relevant times ; and (iv) each of

these defendants was aware of the Company's dissemination of information to the investing

public which they knew or recklessly disregarded was materially false and misleading .

52. The defendants had actual knowledge of the misrepresentations and omission s

of material facts set forth herein, or acted with reckless disregard for the truth in that they

failed to ascertain and to disclose such facts, even though such facts were available to them .

Such defendants' material misrepresentations and/or omissions were done knowingly or

recklessly and for the purpose and effect of concealing UnumProvident's operation condition

and future business prospects from the investing public and supporting the artificially inflated

price of its securities . As demonstrated by defendants' overstatements and misstatements of

the Company's business, operations and earnings throughout the Class Period, defendants, if

they did not have actual knowledge of the misrepresentations and omissions alleged, were

reckless in failing to obtain such knowledge by deliberately refraining from taking those steps

necessary to discover whether those statements were false or misleading .

53 . As a result of the dissemination of the materially false and misleading

information and failure to disclose material facts, as set forth above, the market price of the

CorTS Certificates was artificially inflated during the Class Period . In ignorance of the fact that

market prices of the Certificates were artificially inflated, any relying directly or indirectly on the

false and misleading statements made by defendants, or upon the integrity of the market in

which the certificates trade, and/or on the absence of material adverse information that was

known to or recklessly disregarded by defendants but not disclosed in public statements b y

15

0 0

defendants during the Class Period, plaintiffs and the other members of the Class acquire d

Certificates during the Class Period at artificially high prices and were damaged thereby .

54. At the time of said misrepresentations and omissions, plaintiff and othe r

members of the Class were ignorant of the information's falsity, and believed it to be true . Had

plaintiff and the other members of the Class and the marketplace known the truth regarding t

he problems that UnumProvident was experiencing, which were not disclosed by defendants ,

plaintiff and other members of the Class would not have purchased or otherwise acquired thei r

Trust certificates, or, if they had acquired such certificated during the Class Period, they woul d

not have done so at the artificially inflated prices which they paid .

55 . By virtue of the foregoing, defendants have violated Section 10(b) of the

Exchange Act, and Rule 10b-5 promulgated thereunder .

56 . As a direct and proximate result of defendants' wrongful conduct, plaintiffs an d

other members of the Class suffered damages in connection with their respective purchase s

and sales of the Trust certificates during the Class Period .

THIRD CLAI M

Violation of Section 20(a) o fThe Exchange Act Against the Individual Defendants

57 . Plaintiff repeats and realleges each and every allegation contained above as i f

fully set forth herein .

58 . The Individual Defendants acted as controlling persons of UnumProvident within

the meaning of Section 20(a) of the Exchange Act as alleged herein . By virtue of their high-

level positions, and their ownership and contractual rights, participation in and/or awareness o f

the Company's operations and/or intimate knowledge of the false financial statements filed by

the Company with the SEC and disseminated to the investing public, the Individual Defendant s

16

LJ Ehad the power to influence and control and did influence and control, directly or indirectly, th e

decision-making of the Company, including the content and dissemination of the variou s

statements which plaintiffs contend are false and misleading . The Individual Defendants were

provided with or had unlimited access to copies of the Company's reports, press releases, publi c

filings and other statements alleged by plaintiffs to be misleading prior to and/or shortly afte r

these statements were issued and had the ability to prevent the issuance of the statements o r

cause the statements to be corrected .

59 . In particular, each of these defendants had direct and supervisory involvement i n

the day-to-day operations of the Company and, therefore, is presumed to have had the powe r

to control or influence the particular transactions giving rise to the securities violations a s

alleged herein, and exercise the same .

60. As set forth above, UnumProvident and the Individual Defendants each violated

Section 10(b) and Rule 1 0b-5 by their acts and omissions as alleged in this complaint . By virtue

of their positions as controlling persons, the Individual Defendants are liable pursuant to

Section 20(a) of the Exchange Act. As a direct proximate result of defendants' wrongful

conduct, plaintiff and other members of the Class suffered damages in connection with thei r

purchases of the Trust certificates during the Class Period .

WHEREFORE , plaintiffs pray for relief and judgment, as follows :

(a) Determining that this action is a proper class action, designating plaintiff as Lea d

Plaintiff and certifying plaintiff as class representative under Rule 23 of the Federal Rules of Civi l

Procedure and plaintiffs counsel as Lead Counsel ;

(b) Awarding compensatory damages in favor of plaintiff and the other Class member s

against all defendants , jointly and severally, for all damages sustained as a result of defendants '

17

wrongdoing, in an amount to be proven at trial, including interest thereon;

(c) Awarding plaintiff and the Class their reasonable costs and expenses incurred in thi s

action, including counsel fees and expert fees ; and

(d) Such other and further relief as the Court may deem just and proper .

JURY TRIAL DEMANDE D

Plaintiff hereby demands a trial by jury.

Dated : July 2, 2003

-D~ IL

STULL STULL & BRODY 47Howard T. Longman , Esq . (HTL 2489)6 East 45th StreetNew York, New York 10017Tel : (212) 687-7230Fax: (212) 490-2022

KANTROWITZ GOLDHAMER& GRAIFMAN, P .C.

By: Gary S. Graifman, Esq . (GSG 2276)747 Chestnut Ridge RoadChestnut Ridge, New York 10977Tel : (845) 356-257 0Fax: (845) 356-4335

Attorneys for Plaintiff

18

CERTIFICATION OF JW.IED PLAINTIFF 7?URSZ] NT To FEDI RAL gECURXT .BSTAW S

Harriet Sern4te .n, hereby certifies and says twat :

1 . x have ;reviewed a draft of the complaint entitled

fiBern T, -P-t

which will be . filed ~n the United States District Court for the

Southern District o,f New York on my behalf- I authorize counsel to

file a substantially similar complaint an my behalf and .to add my

name to any amended complaint .

2 . S did nqt- acquire certificates of Carts- Trust for

Provident Financing! Trust x, the security that is the subject of

this action, at the direction of counsel or in order to participate

in this private action .

3 . . I .am wjliipg .to .serve as a representative party on behalf

of a class, including providing testimony at deposition and .trial,

if necessary .

4, The following includes all of my transactions In . Carts

Trust Certificates during the class period specified in the

complaint :

name . nVMXUfaxl.i'rc l wpm OF TnAKa C 1M Nt t D.Ti' CQ12TX ICATBS PRXC3t E'ER SU =

01/31/2001 FPcSE QOO $25 .0 0

03/13/03 5A.~ 399 $15 .3 5

5 . 1 have. notl served as a representative party in any

securities class action filed within the previous three years .

6 . 1 will nob accept any payment for serving . as a

ti

JS 4A L`Rev. 12/961 CIVIL COVER SHEET aORI(i N AThe JS-44 civil Cover sheet and the information contained herein neither ►eplaoe nor filing plead' firedby law, except as provided by local mks of court . This form . approved by the Judicial the Unit 9 7of the Clerk of Court for the purpose of initiating the cMl docket sheet. (SEE IN OE SEVER FDRM.

1 . (a) PLAINTIFFS DEFENDANTS

HARRIET BERNSTEIN CORTS TRUST FOR PROVIDENT FINANCING TRUST I,ET AL . (SEE RIDER A FOR A COMPLETE LISTINGOF ALL DEFENDANTS. )

(I')) COuN7Y OF RESIDENCE OF FIRST LISTED PLAIN 1FF KINGS

(EXCEPT IN U.S . PLAINTIFF CASES)

(C) ATTORNEYS IF]WM NAME . ADDRESS . AN7 TELEPkCNE NuM6ER) -- -

STCrLL STULL & BRODY6 E . 45TH ST ., SUITE 500NEW YORK, NY 10017 (212) 687-723 0

U . BASIS OF JURISDICTION (PLACE AN •x- IN ONE BOX Cm Y)

a i U.S. Gover ment 1Pl3 Federal Questio nPlaintiff (U.S. Government Not a Party)

❑ 2 US. Government 0 4 Diversit yDefendant (indicate Citizenship of Parties

in item 111)

COUNTY OF RESIDENCE OF F9RS7 USTED DEFENDANT

(IN U.S . PLAINTIFF CASNOTE : IN

yoDEMNATION CASES. USE . ~', , E

FAA LAND itWOIVED .

Ill . CM . ~U PRINCIPAL PARTIES [PUCE FF(For Only)

PJF

PTF DEF

s

Citizen of This State C 1 ❑ 1 Incorporated or Pri rgipai Place ❑ a ❑ aof Business In This Stat e

Citzen 01 Another State ❑ 2 ❑ 7 #ncorporated and P?inclpal Place ❑ 5 ❑ sof Business In Anolber State

Citizen or Subject of a 0 a ❑ 3 Foreign Nation 06 0 6

ORIGIN (PLACE AN-rINONEBOXONLY) App" to Dist~

7

Tfromfrom

Origina# ❑ z Removed from 13 3 Remanded from 0 4 Reinstated or ❑ s another d istrict 0 6 Muttidistrict p 7 MagistrateProceeding State Court Appellate Court Reopened ;'specify) Litigation Judgment

V. NATURE OF SUIT (PL4CEAN'X IN ONEBOX ONLY]

CONTRACT TORTS FORFEITURFJPENALTY BANKRUPTCY OTHER STATUTES

0 110 rnr PERSONAi INJURY PEFt3OKAA. 11MJURY ❑ 618 AwtwtLwe C3 422 AP0061 20 USC 154 ❑ no st" RAapD 0mentp 120 wm . ❑ 310 A l*6a ❑ 362 Personal uqury - ❑ 620 an,.r POW a onq p ue kdt at❑ 130 ~Act 031, AIrgane Plod uc1 Akd. LUIpr4C 1 ❑ 125 Relotad Setiur+r ❑ 423 W0hCrawtl ❑ 430 8a 3 and 9urklyp 140 Hgld 1, riursrmu6 Uassoy 0 36s Penang "Ury - d Ptopuly 21 USC as 25 USC 157 ❑ 450 Comm. ceACC R ianI. c13 150~O ❑ 720 Ube' a uO Ley 0 Uq Laws PROPERTY RIGHTS

0400"Ww

rSUM& ❑ iii AsCnios Persaul ❑ "0 R. H. A TrLx* [31970 RaCV u M&WCad and

[I 1$1 14d w* AG ❑ 330 F.aarar Empoyers mI++y Product L1abIRy ❑ 550 A1rW* Fieya.0❑ 192 R9004" or t ea A

osm

Las y ❑ *40 o ff ,

❑ 3 10 Wnr~ PERS A PROPEM Saf meall [nan ❑ sewove swwcwPah" OSO sm*xmsstCvwmiodnws 1

MM ❑ 345 1644nna Pratluct ❑ 370 Olney Ftaud ❑ 090 Omer ,0 140 T, Q*ma,k ExchaVa

p 153 R~o~rekry of MBrw~yrr~eni U-lay ❑ 371 Truth In Lan0YgD asp waV*NcIf 0 340 OI„o, Pemonal LABOR

❑ 57S Cemamar Craneng eSOCIAL SECURI TY 1!U5C3410

CI 110 ytoc is.n' suln❑ 1 6 0 Cow Contract

p ass uorw velw e prey ❑3+ 1eProduct Wwiidy ❑ 30S Property Asmag, 0 710 Fair Laird SturOSrcm

❑ 891 Apnam0w$i Acts❑ 641 rpA ; t395ff1 ❑ $0 Ew nlC StaCWiatron Aci

Q 155 Cw red Prod, warty 03!0 Omer pen" uywy Produel Llatollry AC - ❑ 4112 elfcK Lung 1923! ❑ asa En rn smar Wow%❑ 720 144 A19m Relations 0 01WCV% W i405<911 ❑ {5 1 Enwyy cat Act

REAL PROPERTY CIVIL RIGHT S PRISONER PETITIONS 0 14 SS32T1 xw ❑ us Fo.eom Of0 7!6 L J gIex Peporeing ❑ Ia5 RE' 44091011 *Warn bn Act

❑ 710 Low Cwmn+nidon p aa7 vamg ❑ S10 M on SO Vap[e a of ciouu . ACt p 100 Appear *C R ! Determi n w M❑ 22e Fdsirow e

m& eR6

0 442 Empwrr n10 aea r sir l

saHabeas CIDrptn

0 740 Ra5way Labor Aa FEDERAL TAX SUITS urwr EW9 Access to dnsuceJeameem Lease(3 23 qu g 0 s)a Grnsras ❑ ON Ca utwnauty a_

0 x50 Tills b La wp its Tat Pr c t tim bal y

~04"n0°u1Or's ❑ 535 Dom Psniky0 "A wrusrr

S40 wan"TKO 6 cow0

p ?" Olney Law Lldpmas ❑ #70 'lases {t1.S PwmmD l

Site S[aa~lrsf] 090 Om SLtlrnory "Ws

I7 217 M DOW ft el Prp»rry A Kwo0 44a Wier cm Poona

336 CIA wplaX 0 m Erne riot. W,- mod01

p rut IRS - Tfwaa PsnyC) 55S Pnson Cot , S'p"'ly AC x6 i35C 7eoe

VI . CAUSE OF ACTIO N [ORE THE U .S CML STATUTE UNDER WwCM YOU ARE FILl 3 AND WRITE B wF STATEMENT pF CAUSE00 NOT CTfE UFUSDC' OMI STATUTES UNLESS ONSWry)

CLASS ACTION PURSUANT TQ §11 OF THE SECURITIES ACT, AND §§10(b) & 20(a) OF THE EXCHANGEACT (15 USC § §78j(b) & 78t(a)), ALLEGING DISSEMINATION OF FALSE AND MISLEADING FINANCIALINFORMATION 10 TM INV ,SS'rmr PUBLICDEMAND $ CHECK YES only if dem in complain tREQUESTED I NVI[ . CHECK IF THIS IS A CLASS ACTIO N

COMPLAINT ❑ UNDER FR .C.P 23 JURY DEMAND : ❑ NO

VIII .RELATED CASE(S) (See instructions) :JUDGE DOCKET NUMBE R

IFANY

S, 0 Y of c ❑DATE ►Y 3, 2003

FOR OFFICE U5 OSIC Y

RECEIPT I AMOUNT APPLYING IFP JUDG ~~ MAO. .A,JOGE

•ARBITRATLON CERTIFICATIO•

HOWARD T . LONGMAN - . counsel for HARRIET BERNSTEI Ndo hereby certify pursuant to the Local Arbitration Rule Section 3(c) . that to the best

of my knowledge and belief the damages recoverable in the above captioned civil action exceed the sum of$100,000 exclusive of interest and costs ,

Relief other than monetary damages is sought .

DISCLOSURE OF INTERESTED PARTIES - LOCAL RULE 9

Identify any corporate parents, subsidiaries or affiliates of named corporate parties :

NONE

Did the cause arise in Nassau or Suffolk County? NO

If you answered yes, please indicate which county .

County of residence of plaintiff(s) (1)(2)(3)

RINGS

County of residence of defendant( s) (1)__ SEE RIDER B

(2)(3 )

I am currentl , admitted in the Eastern District of New York and currently a member in goodstanding of the bar of this court.

Yes No

Are you currently the subject of any disciplinary action (s) in this or any other state or federal court ?

Yes (If yes, please explain) No X

Please provide your E-MAIL Address and bar code below . Your bar code consist of the initials of yourfirst and last name and the last four digits of your social security number or any other four digit numberregistered by the attorney with the Clerk of Court .(This information must be provided pursuant to local rule 11 . 1(b) of the civil rules) #

HL 2489

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