SOURCE: Klafter Olsen & Lesser LLP

October 24, 2013 15:53 ET

Klafter Olsen & Lesser LLP Announces That Earlier Purchasers of Securities in First Marblehead Corp. May Have Claims Against the Company

WASHINGTON, DC--(Marketwired - Oct 24, 2013) - Klafter Olsen & Lesser LLP ("KOL") announces that a securities fraud class action complaint has been filed against First Marblehead Corp. ("First Marblehead") (NYSE: FMD) and certain of its officers in the U.S. District Court for the District of Massachusetts. The complaint asserts claims on behalf of investors who purchased the publicly traded securities of First Marblehead beginning on November 4, 2010 through August 15, 2013 (the "Class Period"). The complaint, which was filed by another law firm, alleges that during this Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (a) the tax treatment for its sale of the Trust Certificate of NC Residuals Owners Trust and similar securities was inappropriate; (b) as a result of the improper tax treatment, First Marblehead was exposed to substantial liability; (c) the Company lacked adequate internal controls; and (d) as a result, First Marblehead's financial statements were misleading during the Class Period.

However, this complaint does not allege that statements made earlier than November 4, 2010 were false and misleading. KOL believes that certain statements made by First Marblehead beginning with Defendants' initial disclosures of the Trust Certificate sale on April 6, 2009 may be materially false and misleading. Thus, KOL believes that there is a basis to extend the class period to begin on April 6, 2009 i.e. a year and half earlier than has currently been alleged.

On August 15, 2013, FMD announced that the tax liability related to its IRS audit would amount to $300 million. In reaction to this adverse news, FMD's stock price fell 36% to close at $1.00 per share the following day. If you purchased First Marblehead securities between April 6, 2009 and August 15, 2013 and sustained losses, please contact Klafter Olsen & Lesser LLP at www.klafterolsen.com or call us at 202/261-3553 for a more thorough explanation of the claims that can be asserted against First Marblehead. The deadline to move to be appointed as a Lead Plaintiff is Monday, October 28, 2013. 

Klafter Olsen & Lesser LLP has offices in Washington D.C. and New York and was founded to offer a unique model that maximizes recoveries for our clients in class action and individual litigation. We have extensive experience representing plaintiffs and defendants in a wide variety of litigation matters including securities, antitrust, corporate governance, commercial, Title VII, trespass, constitutional, and consumer actions. Please visit our website for more information about the Firm.

Contact Information

  • Contact:
    Kurt B. Olsen
    Klafter Olsen & Lesser LLP
    1250 Connecticut Ave. N.W., Suite 200
    Washington, DC 20036
    202/261-3553
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