A class action lawsuit has been filed against XM Satellite Radio Holdings Inc, on behalf of purchasers of the common stock of XMSR between July 28, 2005 and February 15, 2006.

The charges are that XM Satellite Radio Holdings, Inc and Hugh Panero made "materially false and misleading statements to the market during the Class Period" which are violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5.

In short, the claim is that XM Satellite Radio's ability to reach its goal of 6 million subscribers by EOY 2005 was misrepresented, and that they failed to disclose that XM's SAC would rise as it did in Q405.

There are many more details to this class action suit that you can read about in the press release. This just cannot be good for the XMSR share price, which has been getting hammered as of late from a string of bad news.

Thanks to everyone who sent this in!