NEW YORK, May 20, 2020 /PRNewswire/ -- Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Hallmark Financial Services, Inc. ("Hallmark" or the "Company") of the July 6, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Hallmark Financial stock or options between March 5, 2019 - March 17, 2020and would like to discuss your legal rights, click here:www.faruqilaw.com/HALL. There is no cost or obligation to you.
You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail to[email protected]
CONTACT: FARUQI & FARUQI, LLP 685 Third Avenue, 26th Floor New York, NY 10017 Attn: Richard Gonnello, Esq. [email protected] Telephone: (877) 247-4292 or (212) 983-9330
The lawsuit has been filed in the U.S. District Court for the Northern District of Texas on behalf of all those who purchased Hallmark Financial securities between March 5, 2019 - March 17, 2020 (the "Class Period"). The case, Schulze v. Hallmark Financial Services Inc et al. No. 3:20-cv-01130 was filed on May 5, 2020, and has been assigned to Judge Brantley Starr.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose: (1) that the Company lacked effective internal controls over accounting and financial reporting related to reserves for unpaid losses; (2) that the Company improperly accounted for reserve for unpaid losses and loss adjustment expenses related to its Binding Primary Commercial Auto business; (3) that, as a result, Hallmark Financial would be forced to report a $63.8 million loss development for prior underwriting years; (4) that, as a result, Hallmark Financial would exit from its Binding Primary Commercial Auto business; and (5) that, as a result of the foregoing, Defendants' positive statements about the Company's business, operations, and prospects were materially misleading and/or lacked a reasonable basis.
On March 2, 2020, Hallmark Financial announced that it had decided to exit from its Binding Primary Commercial Auto business and reported a $63.8 million loss development for prior underwriting years.
On this news, the Company's stock price fell from $14.33 per share on March 2, 2020 to $12.23 per share on March 3, 2020: a $2.10 or 14.65% drop.
Then, on March 11, 2020, Hallmark Financial disclosed that it had dismissed its independent auditor, BDO USA, LLP ("BDO"), due to a disagreement regarding estimates for reserves for unpaid losses, among other things.
On this news, the Company's stock price fell from $8.10 per share on March 11, 2020 to $5.71 per share on March 12, 2020: a $2.39 or 29.51% drop.
Finally, on March 17, 2020, Hallmark Financial filed with the SEC a letter from BDO in which BDO stated "BDO expanded significantly the scope of its audit on January 31, 2020, with respect to which a substantial portion of the requests had not been received and/or tested prior to our termination."
On this news, the Company's stock price fell from $3.20 per share on March 17, 2020 to $3.12 per share on March 18, 2020: a $0.08 or 2.50% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Hallmark Financial's conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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