Contact Information: William B. Federman FEDERMAN & SHERWOOD 10205 North Pennsylvania Avenue Oklahoma City, OK 73120 (405) 235-1560 Fax: (405) 239-2112 Email to: wbf@federmanlaw.com www.federmanlaw.com
Federman & Sherwood Announces Filing of First Securities Class Action Lawsuit Against Direxion Shares ETF Trust on Behalf of Those Investors Who Purchased or Otherwise Acquired Shares in Direxion Daily Financial Bear 3X Shares (NYSE: FAZ)
| Source: Federman & Sherwood
OKLAHOMA CITY, OK--(Marketwire - September 18, 2009) - On September 18, 2009, Federman &
Sherwood filed the first class action lawsuit in the United States District
Court for the Southern District of New York against Direxion Shares ETF
Trust and others on behalf of any and all investors who purchased or
otherwise acquired shares of Direxion Daily Financial Bear 3X Shares (NYSE : FAZ ) (the "FAZ Fund") during the Class Period of November 3, 2008 through
April 9, 2009. The Complaint alleges violations of federal securities
laws, including Sections 11 and 15 of the Securities Act of 1933.
The FAZ Fund seeks investment results that correspond to three times the
inverse (-300%) daily performance of the Russell 1000 Financial Services
Index ("RFSI"), which measures the performance of the financial services
sector of the U.S. equity market. The complaint alleges the Defendants
violated the Securities Act by failing to disclose that the FAZ Fund is
altogether defective as a directional investment play. Defendants failed
to disclose the following risks in the Company's Registration Statement:
(1) inverse correlation between the FAZ Fund and the RFSI over time would
only happen in the rarest of circumstances, and inadvertently, if at all;
(2) the extent to which performance of the FAZ Fund would inevitably
diverge from the performance of the RFSI -- i.e., the probability, if not
certainty, of spectacular tracking error; (3) the severe consequences of
high market volatility on the FAZ Fund's investment objectives and
performance; (4) the severe consequences of inherent path dependency in
periods of high market volatility on the FAZ Fund's performance; (5) the
role the FAZ Fund plays in increasing market volatility, particularly in
the last hour of trading; (6) the consequences of the FAZ Fund's daily
hedge adjustment always going in the same direction as the movement of the
underlying index, notwithstanding that it is an inverse leveraged ETF; (7)
the FAZ Fund causes dislocations in the stock market; and (8) the FAZ Fund
offers a seemingly straightforward way to obtain desired exposure, but such
exposure is not attainable through the FAZ Fund.
Plaintiff is represented by Federman & Sherwood, who seeks to recover
damages on behalf of the Class. If you are a member of the Class as
described above, you may move the Court no later than Tuesday, November 17,
2009, to serve as a lead plaintiff for the Class. However, in order to do
so, you must meet certain legal requirements pursuant to the Private
Securities Litigation Reform Act of 1995. If you wish to discuss this
action, participate in this or any other lawsuit, or have any questions or
concerns regarding this notice, or preservation of your rights, please
contact: