global satellite communications company Iridium which is owned by a Bermuda-registered partnership.

Shares in Iridium World Communications Inc. fell sharply last week after chief executive Edward Staiano resigned suddenly on Thursday raising questions about the satellite telephone company's future.

And on the same day a potentially massive class action lawsuit was filed in the US District Court on behalf of investors who purchased Iridium stock between September 9 last year and March 29 this year.

The lawsuit -- filed by New York-based law firm Wolf Haldenstein Adler Freeman & Herz -- charges Iridium directors and officers with issuing misleading statements about the company's ability to launch its system.

They are also accused of falsely reporting achievable subscriber numbers and revenue figures and hiding the system's technical problems.

Anyone who bought the stock has until June 21 to join the class action.

Today Iridium -- which Bermuda Digital Communications is aligned with -- is set to report its first-quarter earnings along with updated revenue and subscriber figures.

The fresh turmoil linked to BDC adds to the bad publicity it has endured over its proposed telecommunications tower in Southampton. But BDC's troubles locally are negligible compared with its big brother Iridium's global woes.

Its financial and executive grief seems to have germinated just as competitors -- both of which are also Bermuda-registered -- plan to kick off their products and services in what seems to be a telecommunications boom.

BTC-aligned Globalstar -- who plan to launch a satellite phone service later this year -- and executives at Bermuda-registered but London-based ICO must be watching Iridium's troubles with glee.

Thursday's resignation announcement from Iridium came just before the close of trading on the Nasdaq stock market.

Immediately Iridium shares fell eight percent to close at $17.06 that same day -- a big fall from their yearly peak of $72.19. At one point the shares were down 75 percent from their 52-week high last May.

On Friday they lost another 6 percent to close at $16 -- dangerously close to the company's 52-week low of $14.38.

Iridium immediately announced its board of directors had formed an executive committee to manage day-to-day operations, and appointed John Richardson -- formerly in charge of African operations -- as interim CEO.

A search firm has been hired to find a new CEO.

A spokeswoman for Iridium said Staiano resigned due to disagreements on strategy with the board, but rumours circulated that he was pressured out.

Staiano's shock move follows former chief financial officer Roy Grant, who said last month he was to leave the company.

The exodus follows problems that Iridium has had in meeting earlier expectations of revenues and subscriber numbers.

The company operates 66 satellites with an estimated worth of $5 billion that enable wireless phone calls from almost anywhere in the world from a $3,000 handset.

Slow production and distribution of phones by suppliers, quality problems with certain phone handsets, and poor marketing by regional affiliates all contributed to the shortfalls.

All are now issues at the crux of the lawsuit with the plaintiffs arguing that directors of the company did not warn potential investors of the problems, instead hiding the truth.

In March, lenders granted the company a two month extension to meet growth targets of $4 million in cash revenues and $30 million in cumulative accrued revenues.

The company had signed up 52,000 customers by the end of March 31 -- a massive increase since the end of last year when it had only 3,000 subscribers.

But Iridium chiefs admitted at the end of March that they did not expect to meet the goals.

Analysts expect Iridium's lender to renegotiate the terms of the loans, as well as a possible further financial commitment from Motorola Inc., which owns 20 percent of Iridium.

The spokeswoman said negotiations with the lenders were looking good, and should be completed by the end of May.