CLASS-ACTION SUIT FILED AGAINST CYBERONICS

A class-action shareholders' suit has been filed against Cyberonics.

The lawsuit was filed in the U.S. District Court for the Southern District of Texas on behalf of those who purchased or acquired publicly traded securities of the firm between Feb. 5, 2004, and Aug. 1, 2006.

The complaint alleges that Cyberonics failed to disclose and misrepresented material information known to the firm about:

A new use for its vagus nerve stimulation (VNS) device to treat depression;

The marketability of VNS; and

Insurers' coverage decisions for VNS.

The complaint also charges improper conduct related to stock-option grants awarded to some Cyberonics officers.