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Case Status:    SETTLED
On or around 09/24/2004 (Date of order of final judgment)

Filing Date: October 19, 2001

According to the Company’s FORM 10-Q for the quarterly period ended September 30, 2004, the Rule 10b-5 securities class actions were filed in the District Court for the Northern District of California. These consolidated actions (In re Providian Financial Securities Litigation) alleged that the Company and certain of our officers made false and misleading statements concerning our operations and prospects for the second and third quarters of 2001 in violation of federal securities laws. The class comprised those persons or entities who acquired the Company’s stock between June 6, 2001 and October 18, 2001. In July 2004, these actions were settled in principle on a classwide basis for $65 million to be funded by the Company’s insurance carriers, subject to finalization and court approval. The settlement received final approval from the court in September 2004, with approximately 14% of the settlement amount to cover the plaintiffs’ attorneys’ fees and costs. The Company’s insurance carriers will fund the settlement amount, in addition to the attorneys’ fees that have been incurred by the Company for its own defense.

The original complaint was filed charging Providian and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges that defendants disseminated false and misleading statements concerning the Company's operations and prospects for Q2 and Q3 2001. In late June 2001, Providian changed the way it processes its bankruptcy filings and thus changed when it recognizes losses and deferred the recognition of approximately $30 million of charge-offs from June (and Q2 01) into July. Providian allegedly manipulated its financial statements for Q2 01 and shaved 40 basis points off its Q2 01 managed net charge-off rate of 10.3% and boosted reported EPS by $0.06. Without this change, the loss rate would have been 10.7%. This is well above defendants' guidance of 9.5%-10%. Defendants made no mention of this change on the conference call or in Providian's Q2 01 10-Q. In fact, management only admitted this change after they came under pressure from analysts following a flood of calls to their investor relations department in late August 2001. During the Class Period, taking advantage of the inflation in Providian stock, defendants sold almost $22 million worth of their own Providian stock at artificially inflated prices of as much as $49.30 per share. These sales were out of line with their prior trading history.

COMPANY INFORMATION:

Sector: Financial
Industry: Regional Banks
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: PVN
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: N.D. California
DOCKET #: 01-CV-03952
JUDGE: Hon. Maria-Elena James
DATE FILED: 10/19/2001
CLASS PERIOD START: 06/06/2001
CLASS PERIOD END: 10/11/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Branstetter, Kilgore, Stranch & Jennings
    227 Second Ave. North, 4th Floor, Branstetter, Kilgore, Stranch & Jennings, TN 37201-1631
    615.254.8801 615.255.5419 ·
  2. Milberg Weiss Bershad Hynes & Lerach LLP (S.F., CA)
    100 Pine Street - Suite 2600, Milberg Weiss Bershad Hynes & Lerach LLP (S.F., CA), CA 94111
    415.288.4545 415.288.4534 ·
  3. Milberg Weiss Bershad Hynes & Lerach LLP (San Diego, CA)
    600 West Broadway, 1800 One America Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (San Diego, CA), CA 92101
    800.449.4900 · support@milberg.com
No Document Title Filing Date
COURT: N.D. California
DOCKET #: 01-CV-03952
JUDGE: Hon. Maria-Elena James
DATE FILED: 08/31/2002
CLASS PERIOD START: 06/06/2001
CLASS PERIOD END: 10/18/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Bernstein Litowitz Berger & Grossmann LLP (former San Diego)
    12544 High Bluff Drive, Suite 150, Bernstein Litowitz Berger & Grossmann LLP (former San Diego), CA 92130
    858.793.0070 858.793.0323 · blbg@blbglaw.com
  2. Chitwood & Harley LLP (Atlanta)
    7945 East Paces Ferry Road, 1400 Resurgens Plaza, Chitwood & Harley LLP (Atlanta), GA 30326
    404.266.1650 · info@chitwoodlaw.com
No Document Title Filing Date
No Document Title Filing Date