SOURCE: Schiffrin & Barroway

May 13, 2005 17:15 ET

Shareholder Class Action Filed Against Friedman, Billings, Ramsey Group, Inc. by the Law Firm of Schiffrin & Barroway, LLP

RADNOR, PA -- (MARKET WIRE) -- May 13, 2005 -- The following statement was issued today by the law firm of Schiffrin & Barroway, LLP:

Notice is hereby given that a class action lawsuit was filed in the United States District Court for the Southern District of New York on behalf of purchasers of Friedman, Billings, Ramsey Group, Inc. ("FBR" or the "Company") (NYSE: FBR) common stock during the period between January 29, 2003 and April 25, 2005 (the "Class Period").

If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Schiffrin & Barroway, LLP (Marc A. Topaz, Esq. or Darren J. Check, Esq.) toll free at 1-888-299-7706 or 1-610-667-7706, or via e-mail at info@sbclasslaw.com.

The complaint charges FBR and certain of its officers and directors with violations of the Securities Exchange Act of 1934. FBR is an investment bank that provides investment banking, institutional brokerage and asset management services, and invests as principal in mortgage-backed securities and merchant banking investments. More specifically, the Complaint alleges that the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (1) that the Company was being negatively impacted by its role as a placement agent for an insurer in a PIPE ("private investment in public equity") transaction in 2001; (2) that as a result of the 2001 transaction, the Company was forced to take $7.5 million dollar charge, which adversely affected FBR's earnings; and (3) that the Company's earnings were being adversely impacted by interest rate increases.

On November 9, 2004, FBR filed its third quarter 2004 Form 10-Q in which it disclosed an SEC and NASD investigation concerning its role in 2001 as a placement agent for an issuer in a PIPE (private investment in public equity) transaction. On April 4, 2005, Emanuel J. Friedman, the CEO, resigned. Then, on April 25, 2005, after the market closed, FBR announced disappointing preliminary results for the first quarter 2005, including a charge for its liability in the PIPE transaction. News of this shocked the market. Shares of FBR fell $1.87 per share or 13 percent per share, on April 26, 2005, to close at $12.52 per share.

Plaintiff seeks to recover damages on behalf of class members and is represented by the law firm of Schiffrin & Barroway, which prosecutes class actions in both state and federal courts throughout the country. Schiffrin & Barroway is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world. For more information about Schiffrin & Barroway, or to sign up to participate in this action online, please visit http://www.sbclasslaw.com.

If you are a member of the class described above, you may, not later than July 11, 2005 move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Schiffrin & Barroway, or other counsel of your choice, to serve as your counsel in this action.

Contact Information

  • CONTACT:
    Schiffrin & Barroway, LLP
    Marc A. Topaz, Esq.
    Darren J. Check, Esq.
    280 King of Prussia Road
    Radnor, PA 19087
    1-888-299-7706 (toll free) or 1-610-667-7706
    Or by e-mail at info@sbclasslaw.com