NEW YORK, Nov. 3, 2011 /PRNewswire/ -- Block & Leviton LLP, (www.blockesq.com) is a Boston-based law firm representing investors seeking to recover money lost due to investment fraud. The lawsuit, captioned DeAngelis v. Corzine, et al., is pending in the United States District Court for the Southern District of New York. To obtain a copy of the complaint, email Block & Leviton at [email protected].
The lawsuit alleges violations of United States securities laws on behalf of MF Global's common stockholders from May 20, 2011 through October 28, 2011 (the "Class Period"). Claims for Class Period purchasers arise under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the "Exchange Act") and Rule 10b-5 promulgated thereunder by the United States Securities and Exchange Commission.
The complaint asserts that MF Global (formerly traded on NYSE under MF and/or MFGLQ.PK) through its most senior officers and directors made certain materially false and misleading statements regarding the Company's internal financial controls and liquidity levels. The positive statements about MF Global were allegedly knowingly false and misleading when made because: (1) the Company was suffering from serious liquidity pressures based on its exposure to the European debt crisis; (2) the Company's internal controls were highly deficient and were unable to clearly segregate clients' funds; and (3) MF Global's senior management failed to disclose that the Company's true risk profile would inevitably lead to a credit rating downgrade.
In late October, MF Global faced multiple downgrades of its credit ratings by Moody's Investor Service ("Moody's"), Standard & Poor's ("S&P"), and Fitch Ratings ("Fitch"). The first downgrade occurred on October 24, 2011 when Moody's cut the Company's rating to near junk status. On this news, the Company's stock price plunged $1.69 per share – from $3.55 per share on October 24, 2011 to close at $1.86 per share on October 25, 2011 – a decline of more than 47% on unusually high volume. Moody's and Fitch then slashed the Company's credit rating to junk status on October 27, 2011. This downgrade followed the threat of similar action by S&P. The market reacted swiftly to this news as the Company's stock price fell an additional $0.27 per share – from $1.70 per share on October 26, 2011, to close at an all-time low of $1.43 per share on October 27, 2011 – representing a decline of more than 15%. Thereafter, attempts to spin off the Company's futures trading business failed and, on October 31, 2011, MF Global filed for Chapter 11 bankruptcy protection in United States Bankruptcy Court in New York. The New York Stock Exchange suspended trading in the Company's stock and moved to de-list its shares on November 1, 2011. All told, investors lost approximately $585.0 million in market capitalization in a single week.
If you are a member of the Class, you may, no later than January 2, 2012, request that the court appoint you as Lead Plaintiff for the Class. You may contact the attorneys at Block & Leviton to discuss your rights in the case. You may also retain counsel of your choice and you need not take any action at this time to be a class member.
Block & Leviton is a Boston-based law firm representing investors for violations of securities laws. The firm's lawyers have collectively been prosecuting securities cases on behalf of investors for over 40 years.
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SOURCE Block & Leviton LLP