SOURCE: Johnson & Perkinson

March 06, 2008 14:01 ET

Johnson & Perkinson Announces Commencement of Class Action Litigation Naming Ambac Financial Group, Inc.

SOUTH BURLINGTON, VT--(Marketwire - March 6, 2008) - Johnson & Perkinson hereby announces the commencement of a class action lawsuit naming Ambac Financial Group, Inc. (NYSE: ABK) ("Ambac" or "the Company"). The action, docket numbered 08-CV-00411, was filed in the United States District Court for the Southern District of New York. Individuals, families, trusts or other entities that purchased Ambac securities between October 19, 2005 and November 26, 2007, inclusive, have the opportunity to participate as Lead Plaintiffs in the currently pending litigation. To do so, you must apply to serve in that capacity by March 17, 2008.

Johnson & Perkinson, a litigation boutique law firm based in South Burlington, Vermont, has extensive experience prosecuting investor class actions and actions involving financial fraud. Attorneys Johnson and Perkinson are both former employees of the Securities and Exchange Commission. Dedicated to maximizing shareholder return, members of Johnson & Perkinson have prosecuted complex class actions alleging securities or consumer fraud/deception on behalf of investors/consumers against numerous public companies since 1985, resulting in the recovery of many hundreds of millions of dollars, and have been singled out for excellence by various courts. The firm is litigating, or has recently resolved litigation, as Lead or Co-Lead Counsel in securities class actions against Xerox, Priceline, Wireless Facilities, i2 and Xchange, and serves on the Executive Committee in the Global Crossing case.

The pending Complaint naming Ambac charges that Ambac and certain of its officers and directors violated federal securities laws by issuing materially false statements regarding the Company's insurance coverage on collateralized debt obligations ("CDO") contracts. Specifically, Defendants concealed the following facts: (i) that Ambac lacked requisite internal controls to ensure that the Company's underwriting standards and its internal rating system for its CDO contracts were adequate, and, as a result, the Company's projections and reported results issued during the Class Period were based upon defective assumptions; (ii) that the Company's financial statements were materially misstated due to its failure to properly account for its mark-to-market losses; (iii) that the Company would be forced to tighten its underwriting standards related to its asset-backed securities, which would have a direct material negative impact on its premium production going forward; (iv) that the Company had far greater exposure to anticipated losses and defaults related to its CDO contracts containing subprime loans, including even highly rated CDOs, than it had previously disclosed; (v) that Ambac had far greater exposure to a potential ratings downgrade from one of the credit ratings agencies than it had previously disclosed; and (vi) that Defendants' Class Period statements about the Company's selective underwriting practices during the 2005 through 2007 timeframe related to its CDOs backed by subprime assets were patently false.

If you wish to discuss this action or have any questions concerning this announcement or rights or interests with respect to these matters, please contact Johnson & Perkinson attorneys James F. Conway, III or Eben F. Duval; via email at email@jpclasslaw.com; through our website at www.jpclasslaw.com ; or by mail at Johnson & Perkinson, 1690 Williston Road, P.O. Box 2305, South Burlington, Vermont 05403. Attorneys at Johnson & Perkinson can investigate your potential claims and help you decide if seeking appointment as a Lead Plaintiff is right for you. Your ability to share in any recovery is not affected by your decision to not seek appointment as a Lead Plaintiff.

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