The lawsuit against locally based Homestore.com was filedyesterday in the US District Court of Central California by lawyersrepresenting some investors in Homestore.com's stock. The stock,which traded as high as $37.25 a share in the past year, wasselling for about $3.50 before the Nasdaq exchange halted tradingin its securities after last Friday's closing bell pending receiptof more information about the company's plans to restateearnings.

The complaint alleges that Homestore.com Chairman and CEO StuartH. Wolff, EVP of Business Development and Sales Peter B. Tafeen andformer CFO Joseph J. Shew "misrepresented Homestore's trueprospects in an effort to conceal Homestore's improper acts untilthey were able to sell $27.9 million worth of their own Homestorestock." It also alleges that the company entered into severalquestionable transactions to inflate its earnings in the firstthree quarters of last year and the first three quarters of2001.

Shew resigned from his post earlier this month for what he andthe company said were personal reasons. He had taken the job inFebruary.