NEW YORK, May 4, 2004 (PRIMEZONE) -- A class action lawsuit has been filed by the law firm of Harold B. Obstfeld, P.C. in the United States District Court for the Western District of Missouri on behalf of a class consisting of all purchasers of securities of NovaStar Financial, Inc. ("NovaStar'') (NYSE:NFI), between October 29, 2003 and April 8, 2004, inclusive (the "Class Period'').
The Complaint charges the defendants with violations of federal securities laws. Among other things, the Complaint claims that defendants injured the members of the class by issuing false public statements during the Class Period which overstated the number of offices NovaStar had in operation and which failed to disclose that NovaStar was operating unlicensed offices.
On April 12, 2004, a Wall Street Journal article reported that only six of the 15 offices NovaStar claimed to have in Nevada actually existed and that Nevada authorities had ordered NovaStar to cease operating in that state, because none of its Nevada branches were licensed to do business. The article also revealed that NovaStar had not licensed with Texas regulators any of the branch offices which it claimed to be operating in that state. Following these disclosures, NovaStar's stock price dropped to close at $37.50 per share, down $16.68 per share from the previous trading day's closing price.
If you are a member of the class described above, you may, not later than June 14, 2004, request that the Court appoint you to serve as lead plaintiff for the class. Your right to share in any recovery in this action is not affected by whether or not you serve as a lead plaintiff. If you have any questions or wish to discuss this matter, you may contact:
Harold B. Obstfeld, Esq
Harold B. Obstfeld, P.C.
260 Madison Avenue -- 18th Floor
New York, New York 10016
Tel.:(212) 696-1212 ext. 195
Toll free: (888) 896-0347 ext. 195
e-mail: hobsd@erols.com
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca