UNITED STATES DISTRICT COURT

DISTRICT OF SOUTH DAKOTA

In re DAKTRONICS INC. SECURITIES ) Civil Action No. 4:08- cv-04176-LLPLITIGATION )

) CLASS ACTION

)

This Document Relates To: ))

ALL ACTIONS. ))

AMENDED CONSOLIDATED COMPLAINT FOR VIOLATION OF FEDERALSECURITIES LAWS

NATURE OF ACTION

1. This is a securities class action brought on behalf of purchasers of the common

stock of Daktronics, Inc. (“Daktronics” or the “Company”) between November 15, 2006 and

April 5, 2007, inclusive (the “Class Period”) seeking to pursue remedies under the Securities

Exchange Act of 1934 (the “Exchange Act”) and Rule 10b -5 promulgated thereunder by the

Securities and Exchange Commission (“SEC”). This action is brought against Daktronics, its

President and Chief Executive Officer (“CEO”) James B. Morgan and its Chief Financial Officer

(“CFO”) and Treasurer William R. Retterath (collectively, “defendants”). Defendant Daktronics

designs, manufactures and markets electronic scoreboards, programmable display systems and

large screen video displays using light emitting diode (“LED”) technology, including those used

by outdoor advertising companies in connection with their deployment of digital billboards.

2. Prior to the start of the Class Period, outdoor advertising companies had become

increasingly interested in replacing their existing static billboards with digital billboards, which

had the potential to significantly increase the advertising revenue earned by these outdoor

advertisers. As one of the leading manufacturers of digital billboards, Daktronics emphasized

that it was well -positioned to capitalize on this conversion to digital billboards. In October 2006,

Daktronics opened a new manufacturing facility in Sioux Falls, South Dakota, devoted entirely

to the production of digital billboards in anticipation of a glut of new digital billboard orders

from outdoor advertisers. Because of the purportedly limitless growth potential in the digital

billboard market, analysts paid particular attention, throughout the Class Period, to the

information that defendants provided to the market regarding Daktronics’ digital billboard line.

3. Throughout the Class Period, defendants regularly provided strong revenue and

earnings guidance to investors and analysts based in large part upon significant near -term growth

in digital billboard sales. For example, in a November 15, 2006 Daktronics’ release, defendants

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publicly confirmed the Company’s continued “growth of demand in the digital billboard

marketplace.” On an investor conference call that occurred later that same day, defendant

Retterath further energized investors when he confirmed that Daktronics’ digital billboard

revenue would increase in the second half of fiscal 2007 because “capacity constraints” for

Daktronics’ digital billboard line would diminish as the Company could begin shipping digital

billboards out of the new Sioux Falls facility. 1 In response to these favorable statements

regarding Daktronics’ most closely watched market, digital billboards, the price of Daktronics’

common stock rose by more than 25% from $26.67 per share to $33.60 per share.

4. However, in reality, at the time defendants made their Class Period statements,

they were aware that the Company’s two largest outdoor advertising customers – Lamar Outdoor

Advertising (“Lamar”) and Clear Channel Outdoor – were encountering significant regulatory

obstacles and delays in numerous markets throughout the United States, which was severely

impeding their ability to rollout new digital billboard technology. Defendants concealed from

investors the impact of these developments on Daktronics.

5. Defendants’ concealment of these material facts misled investors and caused

Daktronics’ shares to trade at artificially-inflated levels throughout the Class Period. Indeed, in

February 2007, Daktronics issued a partial disclosure, mentioning that some

“constraints ... exist in the sign business overall” and that those regulatory constraints applied to

an even “greater degree to digital displays.” Although Daktronics’ stock price fell $8.00 per

share (or approximately 21%) to close at $30.09 per share on February 14, 2007, defendants

continued to conceal the negative effect that these regulatory constraints were then having on

the Company’s digital billboard sales – maintaining that Daktronics would post 4Q07 earnings

1 Daktronics’ fiscal year 2007 ran from April 30, 2006 to April 28, 2007.

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per share (“EPS”) of $0.12 -$0.19 – thereby avoiding a complete collapse in the price of the

Company’s shares. In April 2007, defendants caused Daktronics to finally reveal to investors

that Daktronics would be unable to meet the guidance that defendants had provided for 4Q07 or

fiscal 2007, due in large part to a previously undisclosed “ slow down” and “weakness” in the

digital billboard market. The Company’s stock price reacted by plummeting another $5.78 per

share, or approximately 20%, to $22.13 per share, inflicting millions of dollars of loss upon

plaintiffs and other Class members.

6. Defendants’ Class Period statements regarding Daktronics’ financial performance,

which were predicated upon significant near -term growth in the Company’s digital billboard

market, were false and misleading when made. In fact, defendants knew their statements about

Daktronics’ near-term earnings growth from the Company’s digital billboard line were not

attainable due to regulatory constraints and delays that the Company’s outdoor advertising

customers were experiencing.

JURISDICTION AND VENUE

7. The claims asserted herein arise under and pursuant to §§10(b) and 20(a) of the

Exchange Act (15 U.S.C. §§78j(b) and 78t(a)) and Rule 10b-5 promulgated thereunder by the

SEC (17 C.F.R. §240.10b- 5) .

8. This Court has jurisdiction over the subject matter of this action pursuant to 28

U.S.C. § 1331 and §27 of the Exchange Act.

9. Venue is proper in this District pursuant to §27 of the Exchange Act and 28

U.S.C. §1391(b). Many of the acts charged herein, including the preparation and dissemination

of materially false and misleading information, occurred in substantial part in this District.

10. In connection with the acts alleged in this complaint, defendants, directly or

indirectly, used the means and instrumentalities of interstate commerce, including, but not

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limited to, the mails, interstate telephone communications and the facilities of the national

securities markets.

PARTIES

11. Lead Plaintiffs Construction Laborers Pension Trust of Greater St. Louis and Noel

Urben and Trisha Urben, Custodian for Khylie Urben UTMA CT and Derek Urben UTMA CT,

(collectively, “plaintiffs”), as set forth in the certification previously filed with the Court and

incorporated by reference herein, purchased the common stock of Daktronics during the Class

Period and have been damaged thereby.

12. Defendant Daktronics is incorporated in South Dakota and maintains its

headquarters at 201 Daktronics Drive, Brookings, SD 57006. The Company, through its

subsidiaries, engages in the design, development, marketing and support of visual display

solutions for sports, commercial and transportation applications.

13. Defendant James B. Morgan (“Morgan”) is, and was at all relevant times,

President and CEO of Daktronics. Morgan is, and was at all relevant times, a Director of the

Company as well. Morgan became President and Chief Operating Officer of the Company in

1999 and CEO in 2001. Prior to that, from 1976 to 1999, Morgan served as the Company’s Vice

President, Engineering, with responsibility for product development, contract design, project

management and corporate information systems.

14. Defendant William R. Retterath (“Retterath”) is, and was at all relevant times,

CFO and Treasurer of Daktronics. Retterath joined the Company in 2001 as CFO and Treasurer.

Prior to joining the Company, Retterath served as the CFO of MQ Software, Inc., Vice President,

Finance for Computer Associates, Inc. and worked for a number of years prior thereto at Deloitte

& Touche, LLP.

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15. Defendants Morgan and Retterath are referred to herein as the “Individual

Defendants.”

16. During the Class Period, the Individual Defendants, as senior executive officers

and/or directors of Daktronics, were privy to confidential and proprietary information concerning

Daktronics, its operations, finances, financial condition and present and future business

prospects. The Individual Defendants also had access to material adverse non -public

information concerning Daktronics, as discussed in detail below. Because of their positions with

Daktronics, the Individual Defendants had access to non -public information about its business,

finances, products, markets and present and future business prospects via access to internal

corporate documents, conversations and connections with other corporate officers and

employees, attendance at management and/or board of directors meetings and committees

thereof and via reports and other information provided to them in connection therewith. The

Individual Defendants knew or recklessly disregarded that the adverse facts specified herein had

not been disclosed to, and were being concealed from, the investing public.

17. The Individual Defendants are liable as direct participants in the wrongs

complained of herein. In addition, the Individual Defendants, by reason of their status as senior

executive officers and/or directors, were “controlling persons” within the meaning of §20(a) of

the Exchange Act and had the power and influence to cause the Company to engage in the

unlawful conduct complained of herein. Because of their positions of control, the Individual

Defendants were able to and did, directly or indirectly, control the conduct of Daktronics’

business.

18. The Individual Defendants participated in the preparation of, controlled and/or

possessed the authority to control the content of the Company’s reports, releases and

presentations to securities analysts and through them, to the investing public. The Individual

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Defendants were provided with copies of the Company’s reports and releases alleged herein to

be misleading prior to or shortly after their issuance, and had the ability and opportunity to

prevent their issuance or cause them to be corrected. Thus, the Individual Defendants had the

opportunity to commit the fraudulent acts alleged herein.

19. As senior executive officers and/or directors and as controlling persons of a

publicly traded company whose common stock was, and is, registered with the SEC pursuant to

the Exchange Act, and was, and is, traded on the NASDAQ National Market (“NASDAQ”) and

governed by the federal securities laws, the Individual Defendants had a duty to promptly

disseminate accurate and truthful information with respect to Daktronics’ financial condition and

performance, growth, operations, financial statements, business, products, markets, management,

earnings and present and future business prospects, and to correct any previously issued

statements that had become materially misleading or untrue, so that the market price of

Daktronics’ common stock would be based upon truthful and accurate information. The

Individual Defendants’ misrepresentations and omissions during the Class Period violated these

specific requirements and obligations.

20. The Individual Defendants are liable as participants in a fraudulent scheme and

course of conduct, which operated as a fraud or deceit on purchasers of Daktronics’ common

stock, by disseminating false and misleading statements and/or concealing material adverse facts.

The scheme: (i) deceived the investing public regarding Daktronics’ business, operations,

management and the intrinsic value of Daktronics’ securities; and (ii) caused plaintiffs and

members of the Class to purchase Daktronics’ common stock at artificially inflated prices.

PLAINTIFFS’ CLASS AC TION ALLEGATIONS

21. Plaintiffs bring this action as a class action pursuant to Federal Rule of Civil

Procedure 23(a) and (b)(3) on behalf of a class consisting of all those who purchased the

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common stock of Daktronics between November 15, 2006 and April 5, 2007, inclusive, and who

were damaged thereby (the “Class”). Excluded from the Class are defendants, the officers and

directors of the Company, at all relevant times, members of their immediate families and their

legal representatives, heirs, successors or assigns and any entity in which defendants have or had

a controlling interest.

22. The members of the Class are so numerous that joinder of all members is

impracticable. Throughout the Class Period, Daktronics had approximately 40 million shares

outstanding, and its common stock was actively traded on the NASDAQ with an average weekly

volume during the Class Period of more than 4.9 million. While the exact number of Class

members is unknown to plaintiffs at this time and can only be ascertained through appropriate

discovery, plaintiffs believe that there are hundreds or thousands of members in the proposed

Class. Record owners and other members of the Class may be identified from records

maintained by Daktronics or its transfer agent and may be notified of the pendency of this action

by mail, using the form of notice similar to that customarily used in securities class actions.

23. Plaintiffs’ claims are typical of the claims of the members of the Class as all

members of the Class are similarly affected by defendants’ wrongful conduct in violation of

federal law complained of herein.

24. Plaintiffs will fairly and adequately protect the interests of the members of the

Class and have retained counsel competent and experienced in class action and securities

litigation.

25. Common questions of law and fact exist as to all members of the Class and

predominate over any questions solely affecting individual members of the Class. Among the

questions of law and fact common to the Class are:

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(a) whether the federal securities laws were violated by defendants’ acts as

alleged herein;

(b) whether statements made by defendants to the investing public during the

Class Period misrepresented material facts about Daktronics’ business and operations;

(c) whether the price of Daktronics’ common stock was artificially inflated

during the Class Period; and

(d) to what extent the members of the Class have sustained damages and the

proper measure of damages.

26. A class action is superior to all other available methods for the fair and efficient

adjudication of this controversy since joinder of all members is impracticable. Furthermore, as

the damages suffered by individual Class members may be relatively small, the expense and

burden of individual litigation make it impossible for members of the Class to individually

redress the wrongs done to them. There will be no difficulty in the management of this action as

a class action.

BACKGROUND

27. Defendant Daktronics is a leading supplier of electronic scoreboards, large

electronic display systems, marketing services, digital messaging solutions and related software

and services for sports, commercial and transportation applications. During the Class Period, the

Company was divided into three business segments: Sports, Commercial and Transportation.

28. Daktronics’ largest business segment – the Sports division, which generated

approximately 55% of the Company’s revenues during the Class Period – included a full line of

indoor and outdoor scoreboards, timing systems, digital displays, sound systems, statistics

software and other related products. The Company’s indoor sports products ranged from two-

digit shot clocks and small scoreboards to large, center-hung scoreboards incorporating message

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centers and advertising panels. By and large, however, the bulk of revenues from the Company’s

Sports division were earned from large arena projects, such as stadium scoreboards for

professional and collegiate sports teams.

29. Daktronics’ second largest, but fastest growing business segment – the

Commercial division, which generated approximately 40% of Daktronics’ revenues during the

Class Period – included various indoor and outdoor digital applications used primarily as

graphics and text-based displays. Prior to the Class Period, defendants emphasized how outdoor

digital billboards were, by far, the fastest growing product segment in Daktronics’ Commercial

market. Prior to and throughout the Class Period, Daktronics’ two largest customers for its

digital billboard products were outdoor advertising companies Clear Channel Outdoor and

Lamar.

30. Daktronics’ smallest segment – its Transportation division, which only accounted

for approximately 5% of the Company’s Class Period revenues – manufactured and marketed a

number of products, including everything from traffic signage to parking signs and toll way

displays, among others.

31. In 2006, the U.S. outdoor advertising industry as a whole was booming, with only

the Internet-related businesses posting a higher rate of growth. During this time frame, large

outdoor advertising companies, such as Lamar, Clear Channel Outdoors and CBS Outdoors,

began to recognize the opportunity that digital billboards presented – they allowed advertising

companies to rotate images from several different advertisers throughout the day based upon

fixed increments of time. By using digital billboards rather than traditional static billboards,

outdoor advertising companies were able to generate six to ten times more revenue. Outdoor

advertising companies were eager to take advantage of this opportunity, as only approximately

400 of the estimated 450,000 static billboards in the U.S. market had been converted to digital

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billboards by 2006. It was estimated that the outdoor digital billboard market could reach $2

billion by as early as 2010.

32. As one of the leading manufacturers of digital billboards, Daktronics asserted to

investors that it was well -positioned to capitalize on this digital billboard conversion and

recognized that this emerging market could become the Company’s primary engine for future

growth. Throughout 2006, defendants emphasized the strength of Daktronics’ prospects by

noting that Daktronics was increasing its capacity by opening up a new manufacturing facility in

Sioux Falls, so that it could handle the influx of new orders for digital billboards.

33. Significantly, this new market opportunity also provided a potential solution to a

problem that the Company struggled with from financial quarter to quarter – the “lumpiness” of

its Sports revenues and sales. Because Daktronics earned revenue in its Sports segment

primarily through its sale of large -scale, high -cost digital scoreboards to professional and

collegiate sports teams, the Company’s revenue streams in its Sports division were often

“lumpy” (i.e., Daktronics had a pattern of earning large revenues in one financial quarter from a

small number of large -scale, high -cost stadium/arena projects, but then having lower revenues in

the following quarter due to the timing of new Sports orders).

34. Because of the seemingly limitless growth potential that this new digital billboard

market offered, and because of the opportunity that it presented to smooth out Daktronics’ lumpy

Sports revenue streams, prior to and throughout the Class Period, analysts who followed

Daktronics were keenly interested in obtaining information from defendants regarding the

Company’s growth in its digital billboard segment. This was true in spite of the fact that

Daktronics’ digital billboards did not generate nearly as much revenue for the Company as did

the digital scoreboards in its Sports market.

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35. However, beginning in fall 2006 and continuing throughout the Class Period,

defendants were aware that: (i) the Company’s largest customers for digital billboards, Clear

Channel Outdoor and Lamar, were not installing digital billboards at the rates that defendants

had incorporated into Daktronics 4Q07 and FY07 profit numbers because Clear Channel

Outdoor and Lamar were encountering significant regulatory obstacles that were severely

impeding their ability to rollout digital billboards in several major markets; and (ii) the delays

and other uncertainties caused by these regulatory hurdles were, in turn, materially and adversely

affecting the near -term demand for, and therefore, the growth in, the Company’s digital billboard

revenue. In other words, throughout the Class Period, defendants knew (or recklessly

disregarded) that the impact that these regulatory barriers were having on Clear Channel Outdoor

and Lamar precluded Daktronics from posting the tremendous growth in digital billboard sales

that were necessary for the Company to achieve the guidance that defendants provided for 4Q07

and FY07.

FALSE AND MISLEADING STATEMENTS MADE BYDEFENDANTS DURING THE CLASS PERIOD

36. On November 15, 2006, defendants caused Daktronics to issue a release

announcing the Company’s financial results for the fiscal second quarter of 2007, the period

ended October 28, 2006. For the quarter, the Company reported net sales of $123.5 million, net

income of $8.9 million, or $0.22 per diluted share as well as a backlog of approximately $121

million. Defendant Morgan commented on the results, stating in pertinent part:

“Our Sioux Falls facility is coming along nicely. We shipped our first display outof that plant in mid -October. The capacity of this facility will continue to beramped up over the coming months as we add personnel and additional workshifts. We are excited to have the Sioux Falls facility coming on line to help usrespond to the anticipated continued growth of demand in the digital billboardmarketplace. We see workforce availability as a limiting factor to the growth ratein Brookings, and therefore we continue to evaluate opportunities to expandcapacity outside of Brookings.”

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“. . . Our commercial market order bookings are now up over 75% year-to-date led by outdoor advertising opportunities.”

37. In the follow-up investor conference call later that same day, defendants

acknowledged that significant growth in the Company’s digital billboard market was necessary

for Daktronics to meet its greatly increased guidance for fiscal 2007 (ended April 30, 2007):

(a) When questioned about Daktronics’ continued growth, defendant

Retterath stated:

Analyst: Okay. And just, Bill, I’ll put this question to you. The growth rate thatyou’re now targeting for the full year versus where you had been going into thequarter, is that upside being driven primarily by the uptick, the increased activityin the commercial business?

[Defendant] Retterath: Yes, and you know in terms of one of the big factors thatchanged, first, I don’t know if you remember back to last earnings release, wewanted to add more clarity, clearly, to where we saw our growth for the year. ButI think one of the things that’s happened this last quarter is the commercialmarket and in particular, the expectations of future growth in the billboardmarket. So that’s probably the biggest. There’s other factors, too, but that’sprobably the biggest factor.

(b) Defendant Retterath further stated in the November 15, 2006 conference

call that: “[o]n a go-forward basis, I think that potentially that billboard – the percent of the

billboard business could increase from the levels in the first half of the year.”

(c) Defendant Retterath also reiterated that the real constraint that had

previously been limiting Daktronics’ projected digital billboard growth was its plant capacity:

“Yes [sic], and I would hope that we’re in a position where the – as we evolve into the third

quarter, that the capacity constraints for the billboard business diminish significantly for those

customers.”

(d) Defendant Morgan concurred that capacity constraints (which he claimed

had previously held the Company back) would soon disappear, stating: “Our Sioux Falls facility

was not a significant factor in Q2, as it just came online at the end of the quarter, but we are very

excited to begin production of digital billboards out of that facility.” In fact, Morgan emphasized-12-

that in order to meet strong demand, the day shift was already in place and that the Company was

working on staffing up a night shift at the plant.

38. The market reaction to defendants’ November 15, 2006 emphasis on second -half

FY07 growth was swift and favorable, as the price of Daktronics’ common stock rose on

November 15, 2006 from $26.67 per share to $33.60 per share, on extremely heavy trading

volume of more than 4.8 million shares. According to defendants, not only were Daktronics’

core revenue generators – the Commercial and Sports markets – doing well overall, the

Company’s digital billboard line, with its seemingly limitless upside potential, was the fastest

growing portion of the business. Moreover, this growth, which purportedly had been hampered

previously by the Company’s limited capacity, would only increase throughout fiscal 2007 as the

new Sioux Falls digital billboard plant ramped up and added a night shift.

39. On November 20, 2006, Daktronics filed its Form 10 -Q for the second quarter

fiscal 2007. In the Management’s Discussion and Analysis of Financial Condition and Results

of Operations (“MD&A”) section of the Form 10 -Q, defendants again emphasized anticipated

growth in the digital billboard market, stating: “ This industry continues to increase its demand

for video displays in place of traditional billboards due to enhanced margins and cash flow

that they achieve.” Later in the MD&A section, defendants similarly stated: “ We expect that

the growth in the commercial market will continue throughout fiscal year 2007 due to

increased order volume in the billboard market . . . .” Defendants then went on to reiterate that

even though the Company’s net sales were limited by capacity constraints, these constraints

would be remedied by new facilities coming online, stating:

Overall, the level of net sales generated during the second quarter of fiscalyear 2007 and year-to-date in all markets was limited as a result of capacityconstraints within our manufacturing facilities, both in terms of space andpersonnel. This limitation began to diminish in the second quarter as a result ofthe ramping up of facilities in Brookings and Sioux Falls, South Dakota.

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40. The statements made by defendants detailed in ¶¶36-39 were each materially false

and/or misleading when made, as defendants Retterath and Morgan failed to disclose the true

facts, which were then known to them based upon internal Daktronics’ data, including that:

(a) By September 2006, at least 2,000 communities throughout the United

States had banned construction on new billboards entirely – whether static or digital. Moreover,

because billboards were heavily regulated by federal, state and local governments, if outdoor

advertising companies ( e.g., Lamar or Clear Channel Outdoor) wanted to convert their existing

billboards from static to digital, they typically needed the existing billboard legislation to be

amended or updated, which was an unpredictable, time-consuming and expensive process.

Daktronics routinely inserted itself into this process. Navigating through this regulatory process

was delaying Lamar and Clear Channel Outdoor’s installation of digital billboards.

(b) Because many municipalities throughout the United States, including St.

Paul and Bloomington, Minnesota and Des Moines, Iowa, were facing strident opposition from

citizens and other concerned groups who opposed the introduction of digital billboards (because

they created traffic hazards and/or presented a public nuisance), these cities were having to

commission their own safety studies prior to allowing the installation of digital billboards, which

was also delaying Lamar and Clear Channel Outdoor’s installation of digital billboards.

(c) Defendants Retterath and Morgan were aware, prior to their November 15,

2006 public statements, that Daktronics’ two largest digital billboard customers, Lamar and

Clear Channel Outdoor, were facing serious regulatory obstacles in attempting to convert their

billboards from static to digital, as Lamar and Clear Channel Outdoor spoke openly with

defendants about these regulatory concerns prior to the start of the Class Period.

(d) Defendants Retterath and Morgan were aware that because Daktronics

was facing significant regulatory resistance to the deployment of its digital billboards and

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changeable message signs and because Lamar and Clear Channel Outdoor were similarly

encountering stiff resistance in connection with their own efforts to lobby government regulators

to approve digital billboards, Daktronics’ 4Q07 EPS would be adversely impacted by at least

50%.

(e) Contrary to defendants’ representations, Daktronics’ digital billboard sales

were not constrained by capacity limitations. Rather, as Daktronics was advised by both Lamar

and Clear Channel Outdoor, regulatory constraints in a number of jurisdictions, including

Minneapolis/St. Paul, Minnesota, Omaha, Nebraska and Des Moines, Iowa, not lack of capacity

on the supply side, was the reason that the conversion of billboards from static to digital was

being delayed;

(f) In contravention of SEC Staff Accounting Bulletin No. 99 Materiality

(“SAB 99”) and Statement of Position 94-6 (“SOP 94-6”), Daktronics failed to disclose the

material facts detailed in (a)-(e) above in its fiscal 2Q07 Form 10-Q SEC filings, as detailed

herein at ¶¶54-58; and

(g) As a result of (a)-(e) above, defendants had no reasonable basis to believe,

and did not in fact believe, that Daktronics would post “increased order volume in the billboard

market” in the last half of 2007.

The Truth Begins to Be Disclosed

41. On February 14, 2007, defendants caused Daktronics to issue a release

announcing its financial results for the fiscal third quarter of 2007, the period ended January 27,

2007. Defendant Morgan stated:

“We are very pleased with our top and bottom line performance for thequarter . . . . We hit the mid-point of our revenue projection range, and grossprofit margins exceeded 30%. With the reduction in backlog, we will be lookingfor strong order bookings in Q4. . . .”

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“. . . [W]e are expecting orders in billboards and large sports venues,along with the other areas of our business, to be strong in the fourth quarter offiscal 2007, allowing for a strong start for the new fiscal year.”

42. In connection with the release of the Company’s 3Q07 results, defendant Morgan

acknowledged that the Company had experienced “lower than expected level of orders in the

third quarter,” but emphasized that Daktronics remained “ well positioned” to post 4Q07

“earnings in the range of $0.12 to $0.19 per share.”

43. Later that same day, in the follow-up investor conference call, defendants

admitted a number of facts that they had previously withheld from investors. Foremost,

defendant Morgan admitted that “orders for digital billboards were down for the quarter.”

Defendant Morgan also finally acknowledged the existence of regulatory constraints on the

digital market in general, stating:

There remains a lot of excitement about the use of digital billboards. Iwould like to comment, however, that as we have always stated, there areconstraints on the rate of application for the digital billboards. One of the primaryconstraints i[s] the regulatory environment in some municipalities. In some cases,these regulations slow the process of installing digital and in some cases theyprohibit the installation. This again varies from city to city and is important thatinvestors understand that this constraint exists to balance the picture in light of thepotential growth that exists.

44. Morgan reiterated that the decline in billboard revenue for 3Q07 was not a

“trend” and that the “unknown here” was simply “how fast” the digital billboard market was

growing in 4Q07. When pressed by an analyst about the “lower -than-expected billboard orders,”

Morgan stated:

There’s a – we do have a couple larger customers in digital billboards, andcertainly how they decide to schedule their demand is – has a big impact on whatwe see there. So that’s – it can be heavily influenced by a couple customers inthat case. We don’t see it as a trend. It’s just a matter of – I think the unknownhere is how fast it can really grow. As I mentioned, there’s the constraint of theregulation. I think there’s also the reality of there’s some limit to the capacity forthe digital billboard companies just internally and operationally to deploy these.It takes a finite amount of planning and manpower and effort to make this happen,so – and it’s relatively new to the billboard company. So I think how fast theycan and will ramp up is still to be determined.

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45. After finally acknowledging that regulatory factors were the real constraint on

digital billboard growth, defendant Morgan admitted that capacity issues were not hindering the

digital billboard market’s growth potential, stating:

We are in a position now to expand our outbook there reasonably quickly just byadding additional work shifts. So capacity for digital billboards is not a limitingfactor at this time.

46. In response to this partial disclosure, the price of Daktronics’ common stock fell

$8.00 per share on February 14, 2007, or approximately 21%, to close at $30.09 per share, on

extremely heavy trading volume of more than 11.3 million shares. To avoid a complete collapse

in the price of Daktronics’ shares, defendants attempted to slowly disclose the truth about

Daktronics’ billboard sales and earnings prospects, thereby avoiding the level of scrutiny that

would result from a 50% single -day drop in Daktronics’ stock price. Thus, defendants continued

to make statements that Daktronics would post 4Q07 earnings of at least $0.12 per share and as

much as $0.19 per share.

47. On February 23, 2007, Daktronics filed its Form 10 -Q for third quarter fiscal

2007, which mentioned, unlike in the Company’s 2Q Form 10-Q, regulatory constraints that

affected digital billboards, stating: “It is important to note that the same constraints that exist in

the sign business overall with the regulatory environment apply to a greater degree to digital

displays . . . .” However, defendants were careful to reassure investors that “ the outdoor

advertising companies have been very successful in working through these constraints” and

that the Company “ expect[s] that the growth in the commercial market will continue

throughout fiscal year 2007 due to increased order volume in the billboard market . . . .”

48. Although the statements referenced in ¶47 acknowledged that some “constraints”

were impacting the outdoor advertising companies, defendants continued to maintain that

Daktronics was experiencing “increased order volume in the billboard market,” and continued to

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make other false and misleading statements, as they misrepresented and/or concealed the true

facts (which were then known to them based upon internal Daktronics’ data), including that:

(a) By September 2006, at least 2,000 communities throughout the United

States had completely banned construction on new billboards entirely – whether static or digital.

Moreover, because billboards were heavily regulated by federal, state and local governments, if

outdoor advertising companies (e.g., Lamar or Clear Channel Outdoor) wanted to convert their

existing billboards from static to digital, they typically needed the existing billboard legislation

to be amended or updated, which was an unpredictable, time -consuming and expensive process.

Navigating through this regulatory process was delaying Lamar and Clear Channel Outdoor’s

installation of digital billboards.

(b) Because many municipalities throughout the United States, including St.

Paul and Bloomington, Minnesota and Des Moines, Iowa, were facing strident opposition from

citizens and other concerned groups who opposed the introduction of digital billboards (because

they created traffic hazards and/or presented a public nuisance), these cities were having to

commission their own safety studies prior to allowing the installation of digital billboards, which

was also delaying Lamar and Clear Channel Outdoor’s installation of digital billboards.

(c) Defendants Retterath and Morgan were aware, prior to their February 14,

2007 public statements, that Daktronics’ two largest digital billboard customers, Lamar and

Clear Channel Outdoor, were facing serious regulatory obstacles in attempting to convert their

billboards from static to digital, as Lamar and Clear Channel Outdoor spoke openly with

defendants about these regulatory concerns prior to the start of the Class Period.

(d) Defendants Retterath and Morgan were aware that because Daktronics

was facing significant regulatory resistance to the deployment of its digital billboards and

changeable message signs and because Lamar and Clear Channel Outdoor were similarly

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encountering stiff resistance in connection with their own efforts to lobby government regulators

to approve digital billboards, Daktronics’ 4Q07 EPS would be adversely impacted by at least

50%.

(e) Daktronics’ capacity was not a limiting factor in rolling out digital

billboards, rather, regulatory impediments in a number of jurisdictions, including St. Paul and

Bloomington, Minnesota, Omaha, Nebraska and Des Moines, Iowa, were impeding the

conversion of billboards from static to digital and preventing Daktronics from posting the 4Q07

and FY07 EPS numbers disseminated by defendants;

(f) Defendants Retterath and Morgan did not expect growth in the

Commercial market from increased digital billboard revenue in 4Q07, as these defendants were

aware that a number of jurisdictions, which Daktronics counted on for its 4Q07 EPS numbers,

including Bloomington, Minnesota, New York and Texas, were refusing to allow outdoor

advertisers to install digital billboards as defendants had planned for;

(g) Daktronics would not be able to book the $7 million budgeted for 4Q07

with respect to the digital scoreboard that the Company built for the Prudential Center in

Newark, New Jersey and, thus, could not meet its 4Q07 EPS numbers because Daktronics had

not yet completed the accounting requirements necessary to recognize that revenue;

(h) Daktronics was experiencing regulatory delays in connection with two

digital billboard installations for the Kansas City Sprint Center, due to, among other things, the

Federal Highway Administration’s opposition to the proposed site of the installations, which

meant that Daktronics would be unable to meet its 4Q07 EPS numbers;

(i) In contravention of SAB 99 and SOP 94-6, Daktronics failed to

meaningfully disclose in its fiscal 3Q07 SEC filings the material facts detailed in (a)-(h) above,

as detailed herein at ¶¶54-58;

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(j) As a result of (a) -(h) above, defendants had no reasonable basis to believe,

and did not in fact believe, that Daktronics would post “increased order volume in the billboard

market” in fiscal 2007; and

(k) Due to (a) -(h) above, defendants did not expect that Daktronics would

achieve 4Q07 EPS of $0.12-$0.19 per share.

End of Class Period Disclosures

49. On April 5, 2007, after the markets closed, Daktronics issued a release disclosing

that, contrary to their prior public statements, defendants had not been experiencing the growth

in digital billboard revenues that would enable Daktronics to achieve the EPS number that

defendants had previously represented, but rather, was on track to post EPS as much as 70%

below what defendants had previously represented. Defendants further disclosed that, contrary

to their earlier assertions regarding digital billboard sales growth, Daktronics was, in reality,

“unable to book enough orders earlier in the quarter to generate the sales” due to “a combination

of timing and softness in the marketplace,” which caused a “revision in the estimates.”

50. The price of Daktronics’ common stock fell $5.78 per share, or approximately

20%, on the next trading day, to close at $22.13 per share, on heavy trading volume of 6.5

million shares in response to this news. Investors were surprised to learn that which defendants

had been aware of during the Class Period, including that:

(a) Clear Channel Outdoor and Lamar were encountering significant

regulatory resistance to the concept of digital billboards, which had significantly slowed the roll

out of the new technology in several U.S. markets, including Minneapolis/St. Paul, Minnesota,

Des Moines, Iowa, and Memphis, Tennessee, as well as in Texas and New York;

(b) Because of the ongoing delays that Lamar and Clear Channel Outdoor

were experiencing in getting authorization to install digital billboards, Clear Channel Outdoor

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and Lamar were unable to increase their digital billboard order levels during the second half of

2007 as defendants had incorporated into Daktronics 4Q07 and FY07 earnings numbers;

(c) As a result of these obstacles that Lamar and Clear Channel Outdoor were

facing in converting their billboard from static to digital, Daktronics would not be able to meet

the guidance that defendants had provided for 4Q07 or fiscal 2007, which was predicated upon a

consistent 30% growth in quarter to quarter digital billboard sales; and

(d) That as a result of (a)-(c) above, defendants had no reasonable basis to

believe, and did not in fact believe, that Daktronics would experience “increased order volume in

the billboard market” in the second half of fiscal 2007 or would post 4Q07 EPS of $0.12 -$0.19.

51. The markets for Daktronics’ common stock was open, well -developed and

efficient at all relevant times. As a result of these materially false and misleading statements and

failures to disclose, Daktronics’ common stock traded at artificially inflated prices during the

Class Period. Plaintiff and other members of the Class purchased or otherwise acquired

Daktronics’ common stock relying upon the integrity of the market price of Daktronics’ common

stock and market information relating to Daktronics, and have been damaged thereby.

52. During the Class Period, defendants materially misled the investing public,

thereby inflating the price of Daktronics’ common stock, by publicly issuing false and

misleading statements and omitting material facts necessary to make defendants’ statements, as

set forth herein, not false and misleading. Said statements and omissions were materially false

and misleading in that they failed to disclose material adverse information and misrepresented

the truth about the Company, its business and operations, as alleged herein.

53. At all relevant times, the material misrepresentations and omissions particularized

in this Complaint directly or proximately caused or were a substantial contributing cause of the

damages sustained by plaintiffs and other members of the Class. As described herein, during the

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Class Period, defendants made or caused to be made a series of materially false or misleading

statements about Daktronics’ business, prospects and operations. These material misstatements

and omissions had the cause-and-effect of creating in the market an unrealistically positive

assessment of Daktronics and its business, prospects and operations, thus causing the Company’s

stock to be overvalued and traded at artificially inflated prices at all relevant times. Defendants’

materially false and misleading statements during the Class Period resulted in plaintiffs and other

members of the Class purchasing the Company’s common stock at artificially inflated prices,

thus causing the damages complained of herein.

REGULATORY SETBACKS WERE I MPROPERLY OMITTEDFROM CLASS PERIOD SE C FILINGS AND MADE THE

GUIDANCE COMMUNICATED TO INVESTORS DURINGTHE CLASS PERIOD UNATTAINABLE

54. At least by the start of the Class Period, defendants were well aware, but failed to

disclose, that: (i) there was significant regulatory resistance to the concept of digital billboards,

which had significantly delayed the roll out of the new technology; (ii) even municipalities that

indicated that they would ultimately approve digital billboard technology were requiring

significant time to amend and update their billboard regulations, including extensive multi-month

studies of the issues, before the technology would be allowed; (iii) because of these ongoing

problems and delays associated with digital billboard conversion, defendants were aware that

Daktronics’ customers would not be able to significantly increase their digital billboard sales at

levels that defendants had incorporated into Daktronics’ second-half 2007 EPS numbers; and (iv)

as a result of these uncertainties regarding the near-term growth of Daktronics’ digital billboard

revenues and sales, defendants had no reasonable basis to believe, and did not in fact believe,

that the guidance that they provided for 4Q07 or fiscal 2007, which provided for a consistent

30% growth in quarter to quarter digital billboard sales, was attainable.

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55. According to SAB 99, “[t]he omission or misstatement of an item in a financial

report is material if, in the light of surrounding circumstances, the magnitude of the item is such

that it is probable that the judgment of a reasonable person relying upon the report would have

been changed or influenced by the inclusion or correction of the item.” The regulatory hurdles

that Daktronics’ customers were encountering with respect to the installation of digital billboards

were material under SAB 99 and therefore required disclosure.

56. SOP 94 -6 also requires disclosures arising from risks and uncertainties that could

significantly affect the amounts reported in the financial statements in the near term. In

particular, it calls for financial statement disclosure in certain circumstances, if the volume of

business transacted with particular customers could be severely impacted in the near term. SOP

94-6 required the disclosure of the regulatory setbacks that Daktronics’ customers were

experiencing in trying to introduce digital billboards into the market.

57. The overall objective in the MD&A section of SEC filings is to provide investors

with the information needed to assess the financial condition and results of operations of the

registrant. Further, the disclosures are designed, without limitation, to allow investors to view

the business through the eyes of management.2 The MD&A is to focus specifically on material

events known to management that would cause reported financial information not to be

necessarily indicative of future operating results or of future financial condition. If the registrant

knows of events that will cause a material change in revenues, the change in the relationship

must be disclosed.

2 See SEC Release 33 -6834, SEC Interpretation: Management’s Discussion and Analysisof Financial Condition and Results of Operations; Certain Investment Company Disclosures, ofMay 18, 1989.

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58. Moreover, as a result of the developments described below, defendants became

aware that the earnings guidance that they communicated to investors during the Class Period

was uncertain. Defendants’ dissemination of this guidance was false and misleading, as

defendants had no reasonable basis for believing (and did not believe) that the Company could

actually meet the guidance for fiscal 4Q07 and fiscal 2007 that it communicated to investors

during the Class Period.

ADDITIONAL SCIENTER ALLEGATIONS

59. As alleged herein, defendants acted with scienter in that defendants knew that the

public documents and statements issued or disseminated in the name of the Company were

materially false and misleading; knew that such statements or documents would be issued or

disseminated to the investing public; and knowingly and substantially participated or acquiesced

in the issuance or dissemination of such statements or documents as primary violations of the

federal securities laws. As set forth elsewhere herein in detail, defendants, by virtue of their

receipt of information reflecting the true facts regarding Daktronics, their control over, and/or

receipt and/or modification of Daktronics’ allegedly materially misleading misstatements and/or

their associations with the Company which made them privy to confidential proprietary

information concerning Daktronics, participated in the fraudulent scheme alleged herein.

LOSS CAUSATION/ECONOMIC LOSS

60. During the Class Period, as detailed herein, defendants engaged in a scheme to

deceive the market and a course of conduct that artificially inflated the prices of Daktronics’

common stock and operated as a fraud or deceit on Class Period purchasers of Daktronics’

common stock by failing to disclose to investors that:

(a) There was significant regulatory resistance to Lamar and Clear Channel

Outdoor’s installation of digital billboards, which prevented digital billboards from being

installed during the Class Period in several major markets throughout the United States;- 24-

(b) As a result of these ongoing and systemic regulatory hurdles, Daktronics’

customers, such as Lamar and Clear Channel Outdoor, could not increase their digital billboard

purchases from quarter to quarter during the Class Period; and

(c) As a result of the foregoing, defendants had no reasonable basis to believe,

and did not in fact believe, the earnings guidance they disseminated for 4Q07 and FY 2007.

61. When defendants’ prior misrepresentations and fraudulent conduct were disclosed

and became apparent to the market, the price of Daktronics’ common stock fell precipitously as

the prior artificial inflation came out. As a result of their purchases of Daktronics’ common

stock during the Class Period, plaintiffs and the other Class members suffered economic loss,

i.e., damages, under the federal securities laws.

62. By failing to disclose the above facts, defendants presented a misleading picture

of Daktronics’ business and prospects. Defendants’ false and misleading statements had the

intended effect and caused Daktronics’ common stock to trade at artificially inflated levels

throughout the Class Period, reaching as high as $39.46 per share on December 14, 2006.

63. As a direct result of defendants’ disclosures on February 14, 2007 and April 5,

2007, the price of Daktronics’ common stock fell precipitously, falling more than 40% from its

Class Period high. These disclosures removed the inflation from the price of Daktronics’

common stock, causing real economic loss to investors who had purchased Daktronics’ common

stock during the Class Period.

64. The more than 40% decline in the price of Daktronics’ common stock after these

disclosures came to light was a direct result of the nature and extent of defendants’ fraud finally

being revealed to the market. The timing and magnitude of the price decline in Daktronics’

common stock negates any inference that the loss suffered by plaintiffs and the other Class

members was caused by changed market conditions, macroeconomic or industry factors or

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Company -specific facts unrelated to the defendants’ fraudulent conduct. The economic loss, i.e.,

damages suffered by plaintiffs and the other Class members was a direct result of defendants’

fraudulent scheme to artificially inflate the prices of Daktronics’ common stock and the

subsequent significant decline in the value of Daktronics’ common stock when defendants’ prior

misrepresentations and other fraudulent conduct were revealed.

APPLICABILITY OF PRESUMPTION OF RELIANCE:FRAUD ON THE MARKET DOCTRINE

65. At all relevant times, the market for Daktronics’ common stock was an efficient

market for the following reasons, among others:

(a) Daktronics’ common stock met the requirements for listing, and was listed

and actively traded on the NASDAQ, a highly efficient and automated market;

(b) as a regulated issuer, Daktronics filed periodic public reports with the SEC

and the NASDAQ;

(c) Daktronics regularly communicated with public investors via established

market communication mechanisms, including through regular disseminations of press releases

on the national circuits of major newswire services and through other wide -ranging public

disclosures, such as communications with the financial press and other similar reporting services;

and

(d) Daktronics was followed by several securities analysts employed by major

brokerage firms who wrote reports which were distributed to the sales force and certain

customers of their respective brokerage firms. Each of these reports was publicly available and

entered the public marketplace.

66. As a result of the foregoing, the market for Daktronics’ common stock promptly

digested current information regarding Daktronics from all publicly available sources and

reflected such information in the prices of the stock. Under these circumstances, all purchasers

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of Daktronics’ common stock during the Class Period suffered similar injury through their

purchase of Daktronics’ common stock at artificially inflated prices and a presumption of

reliance applies.

COUNT I

VIOLATION OF SECTION 10(b) OF THE EXCHANGE ACT AND RULE 10B-5PROMULGATED THEREUNDER AGAINST ALL DEFENDANTS

67. Plaintiffs repeat and reallege each and every allegation as set forth above as if

fully set forth herein.

68. During the Class Period defendants carried out a scheme and wrongful course of

conduct which was intended to and, throughout the Class Period, did: (i) deceive the investing

public, including plaintiffs and other Class members as alleged herein; (ii) artificially inflate the

price of Daktronics’ and other securities during the Class Period; and (iii) cause plaintiffs and

other Class members to purchase Daktronics’ stock at inflated prices.

69. Defendants: (a) employed devices, schemes, and artifices to defraud; (b) made

untrue statements of material fact and/or omitted to state material facts necessary to make the

statements made not misleading; and (c) engaged in acts, practices, and a course of business

which operated as a fraud and deceit upon the purchasers of the Company’s securities in an effort

to maintain artificially high market prices for Daktronics’ securities in violation of § 10(b) of the

Exchange Act and Rule 10b-5. These defendants are sued either as primary participants in the

wrongful and illegal conduct charged herein or as controlling persons as alleged below.

70. Defendants, directly and indirectly, by the use, means or instrumentalities of

interstate commerce and/or of the mails, engaged and participated in a wrongful course of

business designed to misrepresent and/or to conceal adverse material information about the

business, operations and future prospects of Daktronics as specified herein.

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71. Defendants employed devices, schemes and artifices to defraud, while in

possession of material adverse non -public information and engaged in acts, practices, and a

course of conduct as alleged herein in an effort to assure investors of Daktronics’ value and

performance and continued substantial growth, which included the making of, untrue statements

of material fact and omitting to state material facts necessary in order to make the statements

made about Daktronics and its business operations and future prospects in the light of the

circumstances under which they were made, not misleading, as set forth more particularly herein,

and engaged in transactions, practices and a course of business which operated as a fraud and

deceit upon the purchasers of Daktronics’ securities during the Class Period.

72. Each of the defendants’ primary liability and/or controlling person liability, arises

from the following facts: (i) defendants Retterath and Morgan were high-level executives and/or

directors at the Company during the Class Period and members of the Company’s management

team or had control thereof; (ii) each of these defendants, by virtue of his responsibilities and

activities as a senior officer and/or director of the Company was privy to and participated in the

creation, development and reporting of the Company’s internal budgets, plans, projections and/or

reports; (iii) each of these defendants enjoyed significant personal contact and familiarity with

the other defendant and was advised of and had access to other members of the Company’s

management team, internal reports and other data and information about the Company’s

finances, operations, and sales at all relevant times; and (iv) each of these defendants was aware

of the Company’s dissemination of information to the investing public which they knew or

recklessly disregarded was materially false and misleading.

73. The defendants named herein had actual knowledge of the misrepresentations and

omissions of material facts set forth herein, or acted with reckless disregard for the truth in that

they failed to ascertain and to disclose such facts, even though such facts were available to them.

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Such defendants’ material misrepresentations and/or omissions were done knowingly or

recklessly and for the purpose and effect of concealing Daktronics’ operating condition and

future business prospects from the investing public and supporting the artificially inflated price

of its securities. As demonstrated by defendants’ overstatements and misstatements of the

Company’s business, operations and earnings throughout the Class Period, defendants, if they

did not have actual knowledge of the misrepresentations and omissions alleged, were reckless in

failing to obtain such knowledge by deliberately refraining from taking those steps necessary to

discover whether those statements were false or misleading.

74. As a result of the dissemination of the materially false and misleading information

and failure to disclose material facts, as set forth above, the market price of Daktronics’

securities was artificially inflated during the Class Period. In ignorance of the fact that market

prices of Daktronics’ securities were artificially inflated, and relying directly or indirectly on the

false and misleading statements made by defendants, or upon the integrity of the market in which

the securities trade, and/or on the absence of material adverse information that was known to or

recklessly disregarded by defendants but not disclosed in public statements by defendants during

the Class Period, plaintiffs and the other members of the Class acquired Daktronics’ securities

during the Class Period at artificially high prices and were damaged thereby.

75. At the time of said misrepresentations and omissions, plaintiffs and other

members of the Class were ignorant of their falsity, and believed them to be true. Had plaintiffs

and the other members of the Class and the marketplace known the truth regarding the problems

that Daktronics was experiencing, which were not disclosed by defendants, plaintiffs and other

members of the Class would not have purchased or otherwise acquired their Daktronics

securities, or, if they had acquired such securities during the Class Period, they would not have

done so at the artificially inflated prices which they paid.

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76. By virtue of the foregoing, each of the defendants named herein have violated

§ 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder.

COUNT II

VIOLATION OF SECTION 20(a) OF THE EXCHANGE ACTAGAINST THE INDIVIDU AL DEFENDANTS

77. Plaintiffs repeat and reallege each and every allegation contained above as if fully

set forth herein.

78. Defendants acted as controlling persons within the meaning of §20(a) of the

Exchange Act as alleged herein. By virtue of their high-level positions, and their ownership and

contractual rights, participation in and/or awareness of the Company’s operations and/or intimate

knowledge of the false financial statements filed by the Company with the SEC and disseminated

to the investing public, defendants had the power to influence and control and did influence and

control, directly or indirectly, the decision-making of the Company, including the content and

dissemination of the various statements which plaintiffs contend are false and misleading.

Defendants were provided with or had unlimited access to copies of the Company’s reports,

press releases, public filings and other statements alleged by plaintiffs to be misleading prior to

and/or shortly after these statements were issued and had the ability to prevent the issuance of the

statements or cause the statements to be corrected. Defendants Retterath and Morgan had direct

and supervisory involvement in the day-to-day operations of the Company and, therefore, is

presumed to have had the power to control or influence the particular transactions giving rise to

the securities violations as alleged herein, and exercised the same. By virtue of their positions as

controlling persons, defendants are liable pursuant to §20(a) of the Exchange Act.

79. As a direct and proximate result of defendants’ wrongful conduct, plaintiffs and

the other members of the Class suffered damages in connection with their respective purchases

of the Company’s securities during the Class Period.

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80. Defendants acted as controlling persons of Daktronics within the meaning of

§20(a) of the Exchange Act, 15 U.S.C. §78t(a), as alleged herein. By virtue of their positions as

officers, directors or controlling shareholders of Daktronics, their high-level positions, and

participation in and/or awareness of the Company’s operations, defendants had the power to

influence and control and did influence and control, directly or indirectly, the decision -making of

the Company, including the content and dissemination of the various statements that plaintiffs

contend are false and misleading. Defendants were provided with or had unlimited access to

copies of the Company’s reports, press releases, public filings and other statements alleged by

plaintiffs to be misleading prior to and/or shortly after these statements were issued and had the

ability to prevent the issuance of the statements or cause the statements to be corrected.

81. In particular, each of the Individual Defendants had direct involvement or

intimate knowledge of the day -to-day operations of the Company during the Class Period.

Therefore, each is presumed to have had the power to control or influence the particular

transactions giving rise to the securities violations as alleged herein, and exercised the same.

Daktronics controlled the Individual Defendants and all of its employees.

82. By reason of such wrongful conduct, defendants are liable pursuant to §20(a) of

the Exchange Act. As a direct and proximate result of the wrongful conduct, plaintiffs and other

members of the Class suffered damages in connection with their purchases of the Company’s

stock during the Class Period.

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PRAYER FOR RELIEF

WHEREFORE, plaintiffs pray for relief and judgment, as follows:

A. Determining that this action is a proper class action and certifying plaintiffs as

Class representatives under Rule 23 of the Federal Rules of Civil Procedure and plaintiffs’

counsel as Class Counsel;

B. Awarding compensatory damages in favor of plaintiffs and the other Class

members against all defendants, jointly and severally, for all damages sustained as a result of

defendants’ wrongdoing, in an amount to be proven at trial, including interest thereon;

C. Awarding plaintiffs and the Class their reasonable costs and expenses incurred in

this action, including counsel fees and expert fees; and

D. Such other and further relief as the Court may deem just and proper.

JURY TRIAL DEMANDED

Plaintiffs hereby demand a trial by jury.

DATED: April 13, 2009 DOUGHERTY & DOUGHERTY, LLPPATRICK T. DOUGHERTYTIMOTHY J. DOUGHERTY

s/ TIMOTHY J. DOUGHERTY

TIMOTHY J. DOUGHERTY

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100 North Phillips Avenue, Suite 402P.O. Box 2376Sioux Falls, SD 57101-2376Telephone: 605/335-8586605/331-2519 (fax)

Liaison Counsel

COUGHLIN STOIA GELLERRUDMAN & ROBBINS LLP

DARREN J. ROBBINSJOHN J. RICEJESSICA T. SHINNEFIELD655 West Broadway, Suite 1900San Diego, CA 92101Telephone: 619/231-1058619/231-7423 (fax)

Lead Counsel for Plaintiffs

CAVANAGH & O’HARAPATRICK J. O’HARA407 East Adams StreetSpringfield, IL 62701Telephone: 217/544-1771217/544-9894 (fax)

Additional Counsel for Plaintiff

S:\CasesSD\Daktronics\Amended Consolidated Complaint.doc

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