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Case ID: 5158 | Stocks | 08/13/2008
According to a press release dated August 7, 2008, a class action has been commenced on behalf of all persons who acquired KKR Financial Holdings, LLC (“KFN”) (NYSE:KFN) common stock pursuant or traceable to the Company’s false and misleading Registration Statement and Prospectus (collectively, the “Registration Statement”) issued in connection with its May 4, 2007 merger and share issuance (“Merger”).
Specifically, the complaint charges KFN and certain of its officers and directors with violations of the Securities Act of 1933. KFN is a specialty finance company that invests in multiple asset classes. The complaint alleges that the Registration Statement was false and misleading in that it misrepresented and/or omitted material facts, including: (a) the problematic real-estate-related assets held by the Company were a much bigger risk to the Company than the Registration Statement had represented; (b) the Company’s capital would be insufficient given the deterioration in its portfolio which would necessitate capital preservation and the need to raise capital to the detriment of common stockholders; and (c) the Company was failing to adequately record loss reserves for its mortgage-related exposure, causing its balance sheet and financial results to be artificially inflated. During May, June and most of July 2007, KFN’s stock traded above $25 per share. In late July, many mortgage-related companies’ stock prices declined, including KFN’s. Nevertheless, KFN’s stock closed at $18.02 per share on August 13, 2007. Then, on August 15, 2007, KFN issued a release which revealed that KFN would be selling $5.1 billion in mortgage backed securities at a loss. When this news was revealed, KFN’s stock price collapsed to as low as $9.39 per share, eventually closing at $10.52 per share, a decline from the prior day of 31%. KFN shares currently trade for approximately $10 per share, a 63% decline from the $26.90 per share at which they were sold to plaintiff and the Class.
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 Several class actions have been filed against global telecommunications provider Primus Telecommunications Group, Inc. (Nasdaq:PRTL), and certain of its officers and directors by stockholders who purchased the company's common stock between November 11, 2003, and July 29, 2004, including all those who purchased securities in Primus' January 13, 2004, debt
offering. The actions claim 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.
A class action has been filed against Immucor, Inc. (BLUD), certain of its officers and directors by stockholders who purchased the company's common stock between January 7, 2005 and August 29, 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. On April 30, 2008, a notice of motion to appoint lead plaintiffs and lead counsels was filed by certain groups and individuals. As a result, an order granting motion to appoint lead plaintiffs and counsels was entered on April 30, 2008.
According to the complaint, as a direct result of the market learning of defendant's misrepresentations and omissions, the price of Lehman Brothers shares declined and plaintiff and the class suffered a loss on their investments in Lehman Brothers. A class action lawsuit was filed on behalf of all purchasers of the common stock of ChoicePoint, Inc. (CPS: NYSE).
The complaint charges ChoicePoint and certain of its officers and directors with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. Specifically, the complaint alleges that defendants, during the Class Period, issued a series of material misrepresentations to the market concerning the Company's financial condition thereby artificially inflating the price of ChoicePoint's common stock.
A class action has been filed against DreamWorks Animation SKG, Inc. (NYSE:DWA), certain of its officers and directors by stockholders who purchased the company's common stock between October 27, 2004 and May 10, 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. |
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