The Bear Stearns Companies Inc. - Securities Class Action

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Copyright (c) 2001
Stanford Law School

The Bear Stearns Companies Inc. Summary: The original complaint charges Bear Stearns and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Bear Stearns, through its broker-dealer and international bank subsidiaries, provides investment banking, securities and derivatives trading, clearance, and brokerage services worldwide.

Specifically, the complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. As a result of defendants’ false statements, Bear Stearns stock traded at artificially inflated prices during the Class Period, reaching a high of $159.36 per share in April 2007. In late June 2007, news about Bear Stearns’ risky hedge funds began to enter the market and its stock price began to fall. On March 10, 2008, information leaked into the market about Bear Stearns’ liquidity problems, causing the stock to drop to as low as $60.26 per share before closing at $62.30 per share. On March 13, 2008, news that Bear Stearns was forced to seek emergency financing from the Federal Reserve and J.P. Morgan Chase hit the market and Bear Stearns stock fell to $30 per share. Then, on Sunday, March 16, 2008, it was announced that J.P. Morgan Chase was purchasing Bear Stearns for $2 per share. By midday on Monday, March 17, 2008, Bear Stearns stock had collapsed another 85% to $4.30 per share on volume of 75 million shares.

According to the complaint, the Company’s Class Period statements were materially false due to defendants’ failure to inform the market of the problems in the Company’s hedge funds due to the deteriorating subprime mortgage market, which would cause Bear Stearns to have to rescue the funds, cause the Company and its officers possible criminal liability and hurt the Company’s reputation.

On June 2, 2008, a class action lawsuit in the United States District Court, Southern District of New York, on behalf of all current and former employees of The Bear Stearns Companies, Inc. ("Bear Stearns" or the "Company") (NYSE:BSC) whose compensation, in part, was in the form of restricted stock units ("Restricted Stock Units") and/or capital accumulation plan units ("CAP Units"), issued to the current and former Bear Stearns employees pursuant to the Company's Restricted Stock Unit Plan (the "RSU Plan") and Capital Accumulation Plan (the "CAP Plan"), and whose rights to either Restricted Stock Units and/or CAP Units were vested, thus providing them a present entitlement to be paid and/or credited an equivalent number of shares of Bear Stearns common stock ("Bear Stearns Stock" or "Company Stock") upon settlement at the end of a deferral period between December 14, 2006 and March 14, 2008, inclusive (the "Class Period"), against the Company and certain officers and directors, alleging fraud pursuant to pursuant to Sections 10(b) and 20(a) of the Exchange Act (15 U.S.C. ss.ss. 78j(b) and 78t(a)) and Rule 10b-5 promulgated thereunder by the SEC (17 C.F.R. ss. 240.10b-5) (the "Class"). The case name is styled Bransbourg v. The Bear Stearns Companies, Inc., et al.

On May 16, 2008, several motions to appoint certain groups as lead plaintiffs and the approval of their selection of lead counsels were filed. On July 08, 2008, a motion to consolidate cases was filed by State of Michigan Retirement System. Lastly, on August 19, 2008, a certified true copy of conditional MDL transfer in order from the MDL panel was entered. It is stated that the case to be transferred to the Southern District of New York and the case is assigned to the Honorable Robert W. Sweet for coordinated or consolidated pretrial proceedings with the actions pending in that district.

On January 05, 2010, an opinion by the court appointed lead plaintiff and lead counsel in this case.

On February 27, 2009, a Consolidated Class Action Complaint For Violations Of The Federal Securities Laws was filed with the court.

On January 19, 2011, the Court issued an opinion denying the defendants’ motion to dismiss the securities claim, but dismissed the ERISA and derivative claims.

INDUSTRY CLASSIFICATION:
SIC Code: 6211
Sector: Financial
Industry: Investment Services

COMPANY/ISSUER NAME:	The Bear Stearns Companies Inc.
COMPANY/ISSUER TICKER:	BSC
COMPANY WEBSITE:	http://www.bearstearns.com

FIRST IDENTIFIED COMPLAINT IN THE DATABASE

Eastside Holdings Inc., et al. v. The Bear Stearns Companies Inc., et al.

COURT: S.D. New York	DOCKET NUMBER: 08-CV-02793
JUDGE NAME: Hon. Robert W. Sweet
DATE FILED: 03/17/2008	SOURCE: Notice of Filing
CLASS PERIOD START: 12/14/2006	CLASS PERIOD END: 03/14/2008
TYPE OF COMPLAINT: Complaint (Unamended and Unconsolidated)
PLAINTIFF FIRMS NAMED IN COMPLAINT:
Abraham, Fruchter & Twersky (New York, 42 Street) 60 East 42 Street, New York, NY, 10021 (voice) 212.687.6655, (fax) , Coughlin Stoia Geller Rudman & Robbins LLP (Melville) 58 South Service Road, Suite 200, Melville, NY, 11747 (voice) 631.367.7100, (fax) 631.367.1173, info@csgrr.com/ Coughlin Stoia Geller Rudman & Robbins LLP (San Diego) 655 West Broadway, Suite 1900, San Diego, CA, 92101 (voice) 619.231.1058, (fax) 619.231.7423, info@csgrr.com/ _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 3

DOCUMENTS FOR THE FIRST IDENTIFIED COMPLAINT
Class Action Complaint for Violation of the Federal Securities Laws - Demand for Jury Trial
Type: Complaint		Date on the document: 03/17/2008
Memorandum Of Law In Support Of The Motion Of Commonwealth Of Massachusetts Pension Reserves Investment Trust Fund For Consolidation Of The Related Actions, Appointment As Lead Plaintiff And Approval Of Its Selection Of Lead Counsel
Type: Memorandum		Date on the document: 5/16/2008
Memorandum Of Law In Support Of The Motion Of Sicav Inversiones Campos Del Montiel And San Antonio Fire & Police Pension Fund For (1) Appointment As Lead Plaintiff; (2) Approval Of Their Selection Of Counsel As Lead Counsel For The Class; And (3) Consolidation Of All Related Actions
Type: Memorandum		Date on the document: 5/16/2008
Notice Of Motion Of Commonwealth Of Massachusetts Pension Reserves Investment Trust Fund For Consolidation, Appointment As Lead Plaintiff. And Approval Of Its Choice Of Lead Counsel
Type: Notice		Date on the document: 5/16/2008
Notice Of Motion Of Sicav Inversiones Campos Del Montiel And San Antonio Fire & Police Pension Fund For (1) Appointment As Lead Plaintiff; (2) Approval Of Their Selection Of Counsel As Lead Counsel For The Class; And (3) Consolidation Of All Related Actions
Type: Motion		Date on the document: 5/16/2008
Order
Type: Order		Date on the document: 5/22/2008
Notice Of Motion Of The State Of Michigan Retirement Systems For Consolidation
Type: Motion		Date on the document: 7/8/2008
US District Court Civil Docket
Type: Docket		Date on the document: 8/19/2008
Opinion
Type: Order of Consolidation		Date on the document: 01/05/2009

REFERENCE COMPLAINT

In Re The Bear Stearns Companies, Inc. Securities, Derivative, And Erisa Litigation

COURT: S.D. New York	DOCKET NUMBER: 08-CV-02793
JUDGE NAME:
DATE FILED: 02/27/2009	SOURCE: Docket
CLASS PERIOD START: 12/14/2006	CLASS PERIOD END: 03/14/2008
TYPE OF COMPLAINT: First Consolidated
PLAINTIFF FIRMS NAMED IN COMPLAINT:
Berman DeValerio Pease Tabacco Burt & Pucillo (CA) 425 California Street, Suite 2025, San Francisco, CA, 94104 (voice) 415.433.3200, (fax) 415.433.6382, Berman, DeValerio & Pease LLP One Liberty Square, Boston, MA, 02109 (voice) 617.542.8300, (fax) , Labaton Sucharow LLP 140 Broadway, New York, NY, 10005 (voice) 212.907.0700, (fax) 212.818.0477, info@labaton.com _____________________________________________ TOTAL NUMBER OF PLAINTIFF FIRMS: 3

DOCUMENTS FOR THE REFERENCE COMPLAINT
Consolidated Class Action Complaint For Violations Of The Federal Securities Laws
Type: Complaint		Date on the document: 02/27/2009
Opinion
Type: Other		Date on the document: 07/16/2009
U.S. District Court Civil Docket
Type: Docket		Date on the document: 02/04/2010
U.S. District Court Civil Docket
Type: Docket		Date on the document: 09/16/2010
Opinion
Type: Other		Date on the document: 01/19/2011
U.S. District Court Civil Docket
Type: Docket		Date on the document: 01/26/2011
Opinion
Type: Other		Date on the document: 02/01/2011
U.S. District Court Civil Docket
Type: Other		Date on the document: 08/26/2011
U.S. District Court Civil Docket
Type: Docket		Date on the document: 11/18/2011

OTHER DOCUMENTS
Class Action Complaint - Jury Trial Demanded
Case Name and/or Number: Aaron Howard, et al. v. The Bear Stearns Companies Inc., et al.
Type: Complaint		Date on the document: 03/17/2008
Class Action Complaint for Violation of the Federal Securities Laws - Demand for Jury Trial
Case Name and/or Number: Razill C. Becher, et al. v. The Bear Stearns Companies Inc., et al.
Type: Complaint		Date on the document: 03/18/2008
Class Action Complaint for Violation of the Federal Securities Laws - Demand for Jury Trial
Case Name and/or Number: Greek Orthodox Archdiocese Foundation et al. v. The Bear Stearns Companies Inc., et al.
Type: Complaint		Date on the document: 03/25/2008
Class Action Complaint for Violation of the Federal Securities Laws - Jury Trial Demanded
Case Name and/or Number: Gilles Bransbourg, et al. v. The Bear Stearns Companies Inc., et al.
Type: Complaint		Date on the document: 6/2/2008

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