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Case ID: 2835 | Stocks | 10/28/2003
A class action has been filed against Federated Investors, Inc. (NYSE: FII) and certain of its affiliated companies by investors who purchased shares in any of Federated's mutual funds between November 1, 1998 and October 21, 2003. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period. The investors seek to recover compensatory damages for the loss of value of their mutual fund shares.
The action charges that, throughout the class period, the defendants failed to disclose that they improperly allowed certain unnamed favored investors (the "John Doe" defendants) to engage in "late trading" and "timing" of the funds' securities. Late trades are trades received after 4:00 p.m. EST that are filled based on that day's net asset value, as opposed to being filled based on the next day's net asset value, which is the proper procedure under SEC regulations. Late trading allows favored investors to make use of market-moving information that only becomes available after 4:00 p.m. and has been compared to betting on a horse race that already has been run. Timing is excessive, arbitrage trading undertaken to turn a quick profit that ordinary investors are told that the funds do not permit. Late trading and timing injure ordinary mutual fund investors--who are not allowed to engage in such practices--and are acknowledged as improper practices by the defendants. The action alleges that, in return for receiving extra fees from the John Doe defendants, Federated Investor and its subsidiaries allowed and facilitated the John Doe defendants' timing and late trading activities, to the detriment of class members, who paid, dollar for dollar, for the John Doe defendants' improper profits. These practices were undisclosed in the funds' prospectuses, which falsely represented that the funds actively police against timing and represented that post-4:00 p.m. EST trades would be priced based on the next day's net asset value and that premature redemptions would be assessed a charge. Mutual Funds InvolvedThe mutual funds allegedly involved in this misconduct are the following: Adjustable Rate Securities Fund At Lawcash.com, it is our goal to keep you informed about important legal cases, class actions and settlements. Our lawyers offer free legal evaluations in tort cases, class actions, personal injury, and other lawsuits because we are dedicated to helping you resolve your legal complaints. Other Stocks Cases of Interest The class has been certified in several consolidated class actions filed against energy utility AES Corporation (NYSE:AES) and certain of its officers and directors by stockholders who purchased the company's common stock, including those who engaged in option transactions concerning AES securities, between July 27, 2000, and November 8, 2002. The actions claim that the defendants violated federal securities laws by issuing a series of material misrepresentations regarding the California energy market to the market over this time period, thereby artificially inflating the price of the company's securities. Kahn Gauthier Swick, LLC ("KGS") announces that shareholders of Jones Soda Company ("Jones Soda" or the “Company”) (Nasdaq:JSDA) who purchased shares of the Company between March 9, 2007 and August 2, 2007 (the "Class Period"), have until November 5, 2007 to move for appointment as Lead Plaintiff in a securities class action lawsuit currently pending in the United States District Court for the Western District of Washington. No class has yet been certified in this action. The complaint charges certain officers and directors of the underwriter Credit Suisse, as well as credit ratings institutions Moody's and DBRS with misleading investors in regards to the risk levels of Mortgage Pass-Through Certificates. A class action has been filed against iMergent, Inc. (AMEX:IIG), certain of its officers and directors by stockholders who purchased the company's common stock between November 30, 2004 and February 25, 2005. The action claims that the defendants violated federal securities laws by issuing a series of material misrepresentations to the market over this time period, thereby artificially inflating the price of the company's securities. The stockholders seek to recover compensatory damages for the loss of value of their stock. A class action lawsuit has been filed in the Western District Court of Missouri against Thomas A. Brown for violations of the Investment Company Act. Class members seek compensatory damages, disgorgement of the fees paid to the investment advisors and punitive damages. According to a law firm press release dated September 5, 2008, a class action complaint has been filed against the company and certain current and former officers and directors. The Complaint alleges violations of Section 11 and Section 15 of the Securities Act of 1933, including allegations of material misrepresentations and omissions in Quest's Registration Statement and Prospectus issued in connection with the Initial Public Offering ("IPO") on November 7, 2007. The class period begins with the IPO on November 7, 2007 and continues through August 25, 2008.
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