EDMONTON, March 14, 2016 /PRNewswire/ - Alberta Investment Management Corporation ("AIMCo"), on behalf of Her Majesty the Queen in Right of the Province of Alberta, is pleased to announce today that it has reached an agreement in principle to recover USD 219 million on behalf of investors in Genworth Financial, Inc., together with the Fresno County Employees' Retirement Association ("Fresno"). The case is pending in the United States District Court for the Eastern District of Virginia, and marks the largest securities class action recovery in that jurisdiction.
AIMCo and Fresno serve as Co-Lead Plaintiffs in the class action securities litigation In re Genworth Financial, Inc. Securities Litigation and have prosecuted this case vigorously for nearly two years. They are gratified to have been able to achieve this significant settlement for all class members. AIMCo is represented by Bleichmar Fonti & Auld LLP ("BFA") and Fresno by Bernstein Litowitz Berger & Grossmann LLP.
"This excellent result, after intense litigation and only two months before trial, demonstrates AIMCo's resolve to vindicate the rights of investors," says Kevin Uebelein, AIMCo Chief Executive Officer. "As a leader in the investment community, AIMCo is committed to ensuring the integrity of the markets and taking decisive action when warranted. We are pleased to have recovered this settlement on behalf of all applicable investors in Genworth."
The lawsuit alleged that Genworth and certain senior executives made false and misleading statements about Genworth's long-term care insurance business and the company's financial statements between October 30, 2013 and November 5, 2014. During this period, Genworth assured investors that it had conducted a deep and thorough review of the reserves it had set aside to cover long-term care claims and that the reserves were adequate. However, beginning on July 29, 2014, Genworth disclosed that it had not conducted an extensive review of its reserves. Subsequently, on November 5, 2014, Genworth announced that it would have to take a $531 million charge to shore up its long-term care business and undertake further review of its reserves, causing a substantial drop in the price of Genworth's securities.
AIMCo sought to be appointed Co-Lead Plaintiff in the prosecution of claims to recover investors' losses. AIMCo and Fresno, through their counsel, conducted an investigation of the claims in the action and overcame Defendants' motion to dismiss in May 2014, when the Court sustained the vast majority of Lead Plaintiffs' claims.
Once the case proceeded to discovery, Lead Plaintiffs' counsel reviewed millions of pages of documents from defendants and third parties, and conducted over 20 depositions of current and former employees of Genworth, other key witnesses, and the parties' experts. Lead Plaintiffs also completed briefing on the motions for class certification and partial summary judgment. Trial was scheduled to commence on May 9, 2016.
AIMCo's litigation counsel was led by BFA partners Joseph A. Fonti, Javier Bleichmar, and Dominic J. Auld, who praised AIMCo's leadership role in the action. "This excellent recovery once again demonstrates AIMCo's commitment to policing the financial markets on behalf of its clients and obtaining substantial recoveries," said Auld, adding "there can be no doubt that AIMCo's engagement and persistence in this type of litigation impacts the recovery for the entire class."
The settlement is subject to Court approval pursuant to a schedule to be set by the Court.
About Alberta Investment Management Corporation (AIMCo)
AIMCo is one of Canada's largest and most diversified institutional investment managers with approximately $90 billion of assets under management. AIMCo was established on January 1, 2008 with a mandate to provide superior long-term investment results for its clients. AIMCo operates at arms-length from the Government of Alberta and invests globally on behalf of 26 pension, endowment and government funds in the Province of Alberta.
For more information please visit www.aimco.alberta.ca.
SOURCE Alberta Investment Management Corp.