Voce acts fast after fallacious press release propels client'sstock

SANTA CLARA, CA: Extreme Networks fell prey to the posting of a

fraudulent press release in an internet chat room last week, causing

trading on its stock to be suspended.

The phony release, which was disguised to resemble a PR Newswire

release, was posted in a Yahoo! Finance chat room. Extreme was alerted

to the situation by NASDAQ, which stopped trading when it was rumored

the company would be buying Viasource Communications, a broadband

technology company based in Florida.

Viasource's stock price jumped from $0.09 to $0.18 on the

news. Extreme also rose 98 cents to $9.80. Trading resumed during

the afternoon. At press time, Viasource was trading at $0.16, and

Extreme had risen to $10.25.

Extreme reported the news to its PR firm, Voce Communications, which

immediately started working on an official statement. "The deal with

these situations is always speed," said Richard Cline, principal with


"We were able to write a release and get it out."

While Voce and Extreme's internal PR team scrambled to find out exactly

what had happened and craft a response, they took no media calls and

relied on cell phones to communicate with each other.

The company issued a statement denying the purchase within an hour of

the alert. Viasource issued a release about four hours after the news


Following the release, Extreme gave interviews to Reuters, Dow Jones,

and Bloomberg. Voce still did not take media calls.

"The thinking in a situation like this was that it was not only

financial, but legal," Cline said. "For an agency to take the

responsibility of handling such a sensitive topic would be very

dangerous for the client."

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