Lerach Coughlin Stoia Geller Rudman & Robbins LLP Files Class Action Suit Against Silicon

Lerach Coughlin Stoia Geller Rudman & Robbins LLP ("Lerach Coughlin") (http://www.lerachlaw.com/cases/siliconstorage/) today announced that a class action has been commenced in the United States District Court for the Northern District of California on behalf of purchasers of Silicon Storage Technology, Inc. ("Silicon Storage") (NASDAQ:SSTI - News) common stock during the period between March 30, 2004 and December 20, 2004 (the "Class Period").

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, William Lerach or Darren Robbins of Lerach Coughlin at 800/449-4900 or 619/231-1058, or via e-mail at wsl@lerachlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.lerachlaw.com/cases/siliconstorage/. Any member of the purported class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

The complaint charges Silicon Storage and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Silicon Storage is a supplier of flash memory semiconductor devices for the digital consumer, networking, wireless communications and Internet computing markets.

The complaint alleges that during the Class Period, defendants issued false and misleading statements regarding the Company's business and prospects. The true facts, which were known by each of the defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company's sales and margins were being materially impacted by Macronix and Intel actively lowering average selling prices; (b) the Company was not on track to achieve Q4 profitability, but rather losses; (c) the Company's gross margin projections were overstated by at least 1,000%; (d) the Company's accounting during the Class Period was false and misleading; and (e) as a result, the Company's Q4 estimates of revenue of $120-$130 million and income of $0.10 to $0.14 per share were grossly inflated and the Company's reported assets were materially overstated. As a result of the defendants' false statements, Silicon Storage's stock traded at inflated prices during the Class Period, increasing to as high as $17.31 on April 14, 2004, whereby the Company's top officers and directors sold more than $2.9 million worth of their own shares.

On December 20, 2004, the Company issued a press release announcing that "its revenue in the fourth quarter is expected to be between $102 and $108 million versus previous guidance of $120 to $130 million. Due to current market conditions, the company expects to record an inventory charge of between $20 and $25 million for excess inventory and to write certain products down to their current estimated market values." On this news, the Company's shares plummeted from $7.00 to $5.43 per share.

Plaintiff seeks to recover damages on behalf of all purchasers of Silicon Storage common stock during the Class Period (the "Class"). The plaintiff is represented by Lerach Coughlin, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Lerach Coughlin, a 140-lawyer firm with offices in San Diego, San Francisco, Los Angeles, New York, Boca Raton, Washington, D.C., Houston, Philadelphia and Seattle, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. Lerach Coughlin lawyers have been responsible for more than $20 billion in aggregate recoveries. The Lerach Coughlin Web site (http://www.lerachlaw.com) has more information about the firm.



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Contact:
Lerach Coughlin Stoia Geller Rudman & Robbins LLP
William Lerach, 800-449-4900
wsl@lerachlaw.com



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Source: Lerach Coughlin Stoia Geller Rudman & Robbins LLP

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