Nuwave stock swings wildly after issue of misleading press release

NEW YORK: Don Middleberg, chairman and CEO of Middleberg Euro RSCG,

has put on three-month probation an employee who issued a misleading

press release for client Nuwave Technologies.

The release, stating that Nuwave would be featured in an article in

Barron's business news magazine, was sent out via Business Wire without

client approval. In fact, Nuwave was only placing an advertorial in the

issue, and planned no editorial coverage.

The press release was corrected after a little over two hours, but

Nuwave's stock price had already shot up by $2.50 in 40 minutes,

an 80% gain and 52-week high. The next day, the stock closed at $1.22, dollars .10 under its pre-fiasco price.

Middleberg said he has now reinstated standard procedure to clear all

releases with clients.

"This was a failure in communications that was understandable, but

should never have happened," said Middleberg.

Joseph Perone, business reporter at The Star-Ledger of Newark, NJ, who

wrote a story about the situation, praised Nuwave for its damage

control, but was critical of Middleberg.

"Certainly, if an account rep can be confused by the difference between

advertorial and editorial copy, that is a telling commentary in itself,"

Perone told PRWeek.

When asked whether the company would seek new PR counsel as a result of

the error, Nuwave's corporate communications head, CFO, and CEO refused

to comment.

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