Class Action Finder » Securities

CMS Energy

yuming — Sat, 07 Jul 2007 03:52:04 +0000

In early January 2007, CMS Energy, a Jackson-based company, announced that it would pay out US$200 million to settle securities class action lawsuits related to trading fraud from 2000 to 2002.

CMS Energy was involved in round-trip energy trades where one of its Houston-based operations made false statements about its business. CMS procured electricity from other energy companies at a fixed price and then sold it back to them at the same price. This type of controversial trading was made famous by the Enron scandal.

In May 2002, CMS Energy revealed it participated in 13 round-trip energy trades with Houston energy companies, Dynegy Inc. and Reliant Resource Inc., between May 2000 and December 2001. These transactions reportedly led CMS to declare US$5.3 billion in false revenue.

When it was discovered, CMS was forced to restate its financial figures and shut down its Houston arm.

A final settlement agreement is expected to be approved by the federal court and concluded by the end of March 2007.

Nortel Networks

yuming — Sun, 20 May 2007 03:53:34 +0000

On 1 July 2004, a class action suit by investors, Ontario Teachers and New Jersey as co-lead plaintiffs, was brought again Nortel Networks. This case was a result of the investors suffering damages because of the defendants’ violation of U.S. securities law from 23 April 2003 to 27 April 2004.

Nortel networks allegedly issued distorted financial statements and performance reports that had an effect of artificially inflating their share prices. The defendants also included: former Nortel CEO Frank Dunn, former CFO Douglas Beatty, former Controller Michael Gollogly, and Audit Committee members Guylaine Saucier, John Edward Cleghorn, Robert Alexander Ingram, and Sherwood Hubbard Smith, Jr, and Robert Ellis Brown.

The company sells Internet and data products, services and support. In addition, Nortel also provides voice and multimedia communications networks.

On 15 March 2004, Nortel released to the press that they delayed publishing its annual report and stated it had to restate its previously issued financial results. This was because it was re-examing the timing of certain aspects of their business in 2003. As a result, their share prices toppled. Shortly after this disaster, on 28 April 2004, Nortel fired the CEO, CFO and Controller. The company then came under the investigation by the Securities and Exchange Commission, the Ontario Securities Commission and the United States Attorney’s Office for the Northern District of Texas, Dallas Division.

Finally, the lead plaintiffs filed a second consolidated amended class action complaint on 16 September 2005 after they accrued even more information to support this claim.

Refco

yuming — Sun, 13 May 2007 03:51:28 +0000

In late 2005, securities fraud class action law suits were launched against Refco, Inc., a New York-based firm.

Refco supplied execution and clearing services for exchange traded derivatives and brokerage services in the fixed income and foreign exchange markets in the United States, Bermuda, and the United Kingdom.

The company toppled when it was known that CEO Phillip Bennett hid US$430 million in bad debts. He was sued for eight counts of felony that included making false reports with the SEC and the intent to commit fraud.

The complaint charged Refco with violating federal securities laws. The defendants in the case are: Phillip Bennett; Refco’s former board of directors; former auditor Grant Thornton LLP; majority owner Thomas H. Lee Partners L.P., a private equity firm; several investment banks, like Bank of America, Credit Suisse and Goldman Sachs, which sold Refco securities to public investors.

The plaintiffs are: Refco bond buyer Pacific Investment Management Company LLC, and RH Capital Associates LLC, an equity purchaser. Others include, Stuart Grant, James Sabella and Megan McIntyre of Grant & Eisenhofer and Max Berger and Sean Coffey of Bernstein Litowitz.

Austrian bank BAWAG was also under investigation for being involved in the Refco debacle. The bank loaned US$420 million to Bennett right before the bad debt scandal news broke out. In response to being sued by investors, BAWAG chose to pay US$108 million to Refco stock and bond buyers, plus an extra US$32 million, which depends on a possible sale of the bank in future.

Hornbeck Offshore Services

yuming — Tue, 13 Feb 2007 03:51:01 +0000

On 22 January 2007, a securities class action was filed on behalf of shareholders who bought Hornbeck Offshore Services stock between 1 November 2006 and 10 January 2007 (also called the class period).

Filed in the United States District Court for the Eastern District of Louisiana, this lawsuit is taken against the defendant Hornbeck and one or more of its directors and/or officers. It was reported that the defendants violated federal securities laws by giving out a series of fabricated and inaccurate statements to the market, that led to artificially inflating the market price of Hornbeck’s securities.

If you are a member of this class, you can serve as a lead plaintiff in court not later than March 19, 2007. A lead plaintiff is a representative that acts on behalf of other class members in the litigation of this case.

UBS Securities

yuming — Sat, 06 Jan 2007 03:54:58 +0000

On February 1 2008, it was announced that a class action suit will be launched against UBS by law firm Charles H. Johnson & Associates in the Southern District of New York. This lawsuit is made on behalf of the purchasers of UBS AG publicly traded securities during the class period of March 13 2007 to December 11 2007.

The complaint says that UBS released numerous business and financial statements that were false and misleading as these reports did not disclose UBS’ failure to timely write-down impaired securities that contained subprime debt.

On October 30 2007, UBS gave out a press release stating its financial results for the third quarter of 2007. Soon after this announcement, UBS stock declined to as low as $49.27 per share.

Subsequently, UBS announced write-downs of around $10 billion as a result of its subprime mortgage-related positions on December 10 2007. This led to the further decline of UBS stock to $48.78 per share, a total of a 26 per cent decline from the class period high.