NEW YORK, May 20, 2005 (PRIMEZONE) -- Pomerantz Haudek Block Grossman & Gross LLP (www.pomerantzlaw.com) filed a class action lawsuit on May 19, 2005, on behalf of purchasers of securities of Friedman, Billings, Ramsey Group, Inc. ("FBR" or the "Company") (NYSE:FBR) during the period from January 29, 2003 through April 25, 2005, inclusive (the "Class Period"). Defendants also include Eric F. Billings and Emanuel J. Friedman, Co-Chief Executive Officers and Co-Chairmen of FBR, and Kurt R. Harrington, Chief Financial Officer. The case, Civil Action Number 05 CV 4851, was filed in the United States District Court, Southern District of New York, and has been assigned to Judge Thomas P. Griesa.
FBR provides investment banking, institutional brokerage and asset management services, and invests as a principal in mortgage-backed securities ("MBS") and merchant banking investments. In March 2003, the Company was formed through the merger of two existing companies, both engaged in related businesses and both managed by the FBR management team.
The Complaint charges that Defendants violated the Securities Exchange Act of 1934 (Section 10(b) and rule 10b-5 promulgated thereunder) by making materially misleading statements and omissions about the Company. Defendants failed to disclose misconduct by FBR's top officials in connection with the Company's role as a placement agent for an issuer in a 2001 private investment placement equity transaction ("PIPE"); related insider trading; and the material adverse impact on FBR's earnings.
The Complaint alleges that on November 9, 2004, FBR filed its third quarter 2004 Form 10-Q in which it disclosed Securities Exchange Commission ("SEC") and National Association of Securities Dealers ("NASD") investigations regarding the PIPE transaction. As a result of this disclosure, FBR's stock dropped to $16.93 per share, some 40% lower than the Class Period high of $28.70 per share. However, the market was not given any information as to the serious nature of the investigations, about their adverse impact on FBR's earnings or that FBR's CEO Emanuel Friedman and other FBR employees were suspected of insider trading relating to the transaction. Then on April 4, 2005, Emanuel J. Friedman, the Co-CEO resigned and on April 25, 2004, FBR announced disappointing preliminary results for the first quarter of 2005, including a charge for its liability in the PIPE transaction. On this news, FBR's stock dropped to $12.52 on volume of 7.5 million shares.
If you purchased FBR securities during the Class Period, you have until July 11, 2005 to ask the Court to appoint you as lead plaintiff for the Class. Lead plaintiffs must meet certain legal requirements. Shareholders outside the United States may also join the action, regardless of where they live or which exchange was used to purchase the securities. If you wish to review a copy of the Complaint, to discuss this action, or have any questions, please contact Teresa L. Webb (tlwebb@pomlaw.com) or Carolyn Moskowitz (csmoskowitz@pomlaw.com) of the Pomerantz Firm at 888.476.6529 (or 888.4-POMLAW), toll free. Those who inquire by e-mail are encouraged to include their mailing address and telephone number.
The Pomerantz Firm, which has offices in New York, Chicago and Washington, D.C., is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 50 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. For more information about the Firm, visit our web site at www.pomlaw.com.
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