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Washington Mutual, Inc. Summary: According to the Transfer Order from the U.S. Judicial Panel on Multidistrict Litigation, dated February 21, 2008, several potentially related actions pending outside the Western District of Washington have been transferred to the Western District of Washington for coordinated or pretrial proceedings before the Honorable Marsha J. Pechman. On May 7, 2008, the Court entered the Order consolidating several cases into lead case 08-CV-0387, In Re Washington Mutual, Inc. Securities Litigation. The case is also being managed in multidistrict litigation In Re Washington Mutual, Inc., Securities, Derivative & "ERISA" Litigation, case number MDL 1919. The Court appointed Ontario Teachers' Pension Plan Board as lead plaintiff and appointed Bernstein Litowitz Berger & Grossman LLP and Byrnes & Keller LLP as lead counsel and liaison counsel, respectively. On September 30, 2008, defendant Washington Mutual Inc. filed a notice of bankruptcy.
Several, similar purported class action complaints been filed in the U.S. District Court for the Southern District of New York and the U.S. District Court for the Western District of Washington. Specifically the complaint charges WaMu and certain of its officers and directors with violations of the Securities Exchange Act of 1934. WaMu is a financial services company and the largest savings and loan bank in the United States. The Company was founded in 1889 and provides financial products and services to consumers and small to mid-sized businesses. The Company offers consumer banking, mortgage lending, commercial banking, and consumer finance throughout the United States.
The complaint alleges that, during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. WaMu’s loan portfolio contained more than $57 billion in adjustable-rate mortgages or Option-ARM loans. The complaint further alleges that the Company failed to disclose: (i) that it had far greater exposure to anticipated losses and defaults in its home loan portfolio, particularly with Option-ARMs, than it had previously disclosed; (ii) that defendants’ Class Period statements about the Company undertaking significant preparations and implementing defensive measures to weather the increasingly difficult credit and housing markets were patently false; (iii) that defendants had engaged in a conspiracy and scheme to inflate the appraisal value of homes with the intent to artificially increase the estimated loan-to-value ratio of its Option-ARM portfolio; and (iv) that due to the Company’s improper appraisal practices, the mortgages it had issued were much riskier than represented.
According to the complaint, on October 17, 2007, after the market closed, WaMu stunned investors by disclosing that it had suffered a 72% drop in third quarter of 2007 net income and would have to set aside up to $1.3 billion in the fourth quarter of 2007 to cover its loan losses. On this news, WaMu’s stock dropped from $33.07 per share to as low as $30 per share, closing at $30.52 per share on October 18, 2007 on volume of more than 36 million shares. Then, on November 1, 2007, News York’s Attorney General issued a press release announcing that a lawsuit was filed against First American Corporation and eAppraiseIT, alleging that they conspired with Washington Mutual to inflate Real Estate appraisals. Following this disclosure, WaMu’s stock dropped to as low as $23.59 per share before closing at $23.81 per share, on volume of 31 million shares.
On October 21, 2008, the lead plaintiff filed a Consolidated Class Action Complaint adding additional defendants as well as additional claims pursuant to the Securities Act.
On May 15, 2009, an Order On Defendants’ Motions To Dismiss was granted in part and denied in part.
INDUSTRY CLASSIFICATION:
SIC Code: 6035
Sector: Financial
Industry: S&Ls/Savings Banks
| COMPANY/ISSUER NAME: | Washington Mutual, Inc. |
| COMPANY/ISSUER TICKER: | WM |
| COMPANY WEBSITE: | http://www.wamu.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Dennis Koesterer, et al. v. Washington Mutual, Inc., et al. | |||||||||||||||||
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| REFERENCE COMPLAINT | |||||||||||||||||
| In Re Washington Mutual, Inc. Securities Litigation | |||||||||||||||||
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| DOCUMENTS FOR THE REFERENCE COMPLAINT | |||
| Consolidated Class Action Complaint | |||
| Type: Complaint | Date on the document: 10/21/2008 | ||
| U.S. District Court Civil Docket | |||
| Type: Docket | Date on the document: 11/12/2008 | ||
| Order On Defendants’ Motions To Dismiss | |||
| Type: Order | Date on the document: 05/15/2009 | ||
| OTHER DOCUMENTS | |||
| Complaint For Violation Of The Federal Securities Laws | |||
| Case Name and/or Number: Abrams, et al. v. Washington Mutual, Inc., et al. | |||
| Type: Complaint | Date on the document: 11/5/2007 | ||
| U.S. District Court Civil Docket | |||
| Case Name and/or Number: Abrams, et al. v. Washington Mutual, Inc., et al. | |||
| Type: Docket | Date on the document: 11/5/2007 | ||
| Class Action Complaint for Violations of Federal Securities Laws - Jury Trial Demanded | |||
| Case Name and/or Number: Mark Nelson, et al. v. Washington Mutual, Inc., et al. | |||
| Type: Complaint | Date on the document: 11/07/2007 | ||
| Class Action Complaint - Jury Trial Demanded | |||
| Case Name and/or Number: Robert L. Garber, et al. v. Washington Mutual, Inc., et al. | |||
| Type: Complaint | Date on the document: 12/19/2007 | ||
| Transfer Order | |||
| Case Name and/or Number: In Re Washington Mutual, Inc., Securities, Derivative & "ERISA" Litigation | |||
| Type: Court Transfer Order | Date on the document: 03/19/2008 | ||
| Class Action Complaint For Violations Of The Securities Act Of 1933 | |||
| Case Name and/or Number: Brockton Contributory Retirement System, et al. v. Washington Mutual, Inc., et al. | |||
| Type: Complaint | Date on the document: 05/13/2008 | ||
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