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Huntington Bancshares Incorporated Summary: According to a press release dated December 19, 2007, the complaint charges Huntington and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Huntington operates as the holding company for The Huntington National Bank (“Huntington National”), which provides retail and commercial financial products and services.
Specifically, the complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results. Huntington had acquired more than $1.5 billion in exposure to subprime mortgages with its July 2007 acquisition of Sky Financial Group, Inc. (“Sky Financial”). As the real estate and credit markets continued to soften, defendants repeatedly assured Huntington investors that the Company had undertaken significant preparations and implemented defensive measures to weather the deteriorating real estate and credit markets. By the time Huntington closed the merger with Sky Financial, the housing and credit crisis had deepened, yet defendants continued to conceal Huntington’s growing exposure to these problems so as to not acknowledge the acquisition was a debacle so soon after it closed. As a result of defendants’ false statements, Huntington stock traded at an artificially inflated price of approximately $18 per share during much of the Class Period.
Then, on November 16, 2007, Huntington announced its fourth quarter 2007 financial results, stating that as a result of the recently announced actions of Franklin Credit Management Corporation, which had a commercial lending relationship with Sky Financial, and related deterioration in Franklin’s mortgage portfolios, 2007 fourth quarter results for Huntington were expected to include an after-tax charge of up to $300 million, or $0.81 per common share. As a result of this charge, Huntington would report a 2007 fourth quarter net loss.
On this news, Huntington’s stock dropped from $16.08 per share to as low as $14.38 per share, closing at $14.75 per share on November 16, 2007 on volume of over 10 million shares.
According to the complaint, the true facts, which were known by defendants but concealed from the investing public during the Class Period, were as follows: (a) the Company had far greater exposure to anticipated losses and defaults in its home loan portfolio, particularly with subprime debt exposure arising from Sky Financial, than it had previously disclosed; and (b) defendants’ Class Period statements about the Company’s financial results were materially false due to its failure to record timely and adequate accruals for losses on its exposure to delinquent subprime mortgages.
INDUSTRY CLASSIFICATION:
SIC Code: 6021
Sector: Financial
Industry: Regional Banks
| COMPANY/ISSUER NAME: | Huntington Bancshares Incorporated |
| COMPANY/ISSUER TICKER: | HBAN |
| COMPANY WEBSITE: | http://www.huntington.com |
| FIRST IDENTIFIED COMPLAINT IN THE DATABASE | |||||||||||||||||
| Stephen Ellman, et al. v. Huntington Bancshares Incorporated, et al. | |||||||||||||||||
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| 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: 12/19/2007 | ||
| US District Court Civil Docket | |||
| Type: Docket | Date on the document: 5/13/2008 | ||
| OTHER DOCUMENTS | |||
| Class Action Complaint - Jury Trial Demanded | |||
| Case Name and/or Number: Michael Vecchio, et al. v. Huntington Bancshares Incorporated, et al. | |||
| Type: Complaint | Date on the document: 01/17/2008 | ||
| Class Action Complaint for Violations of Federal Securities Laws - Jury Trial Demanded | |||
| Case Name and/or Number: Edward Rowe, et al. v. Huntington Bancshares Incorporated, et al. | |||
| Type: Complaint | Date on the document: 02/01/2008 | ||
| Class Action Demand For Jury Trial | |||
| Case Name and/or Number: Rick Tom, et al. v. Huntington Bancshares Incorporated, et al. | |||
| Type: Complaint | Date on the document: 5/7/2008 | ||
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