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Case Status:    SETTLED
On or around 07/25/2007 (Other)

Filing Date: November 05, 2001

By the Order entered on July 25, 2007, on July 20, 2007, the Court approved the Motion for Final Approval of Settlement and Payment of Litigation Expenses filed by Lead Plaintiffs Jacksonville Police & Fire Pension Fund and M. Richard Andrews. During the July 20, 2007 hearing, Co-Lead Counsel informed the Court that the remaining individual defendants would be dismissed from the action after the Court granted final approval. Accordingly, pursuant to Federal Rule of Civil Procedure 41(a)(2), it is hereby ordered that defendants John V. Hashman, Yinzi Cai and Bruce G. Rigione are dismissed from this action.

Individual Defendant Jeremy Lent agreed to a Stipulation of Settlement of April 25, 2007, totaling $635,000.00. On July 23, 2007, the Court entered the Final Judgment and Order of Dismissal with Prejudice as to Jeremy Lent. According to the Order, the settlement was approved.

On March 20, 2006, the court denied motions to dismiss the second amended complaint for certain individual defendants, and granted motion to dismiss the second amended complaint, without leave to amend, for another individual defendant.

According to a law firm’s website, on December 2, 2005 and Judge Jeremy Fogel signed Orders that same day granting final approval of the Settlement and approving the Plan of Allocation. Earlier, on October 30, 2003, Lead Plaintiffs filed a separate action against Ernst & Young, LLP (“E&Y”), NextCard’s former auditor, alleging that E&Y fraudulently deceived investors during the Class Period. On November 5, 2003, the Court issued an Order relating the case filed against E&Y to In re NextCard, Inc. Securities Litigation. On March 10, 2004, E&Y filed a Motion to Dismiss the complaint filed against it, which Lead Plaintiffs opposed. Prior to a ruling of E&Y’s motion, the parties agreed to settle the claims against E&Y and entered into a Stipulation of Settlement. Pursuant to the terms of the proposed settlement with E&Y, which was preliminarily approved by the Court on October 4, 2005, a settlement fund in the amount of $23,200,000 has been created for the benefit of the Class.

On April 27, 2005 Lead Plaintiffs filed a Consolidated Second Amended Class Action Complaint (the “2nd Amended Complaint”), which Defendants moved to dismiss on June 27, 2005. Lead Plaintiffs filed their opposition to Defendants’ motions on August 31, 2005. A hearing on Defendants’ motions was held on October 28, 2005, and Judge Jeremy Fogel took the motions under submission.

On January 28, 2002 the Court issued an order appointing Lead Plaintiffs and Co-Lead Counsel. On January 30, Judge Fogel issued an order consolidating all related cases into one class action lawsuit entitled In re NextCard, Inc. Securities Litigation. Lead Plaintiffs filed their Consolidated Class Action Complaint (the “Consolidated Complaint”) on June 17, 2002. On April 23, 2004, Lead Plaintiffs filed their Consolidated First Amended Class Action Complaint (the “1st Amended Complaint”) on behalf of persons and entities who purchased NextCard securities between April 19, 2000 and October 30, 2001. NextCard is not named as a Defendant due to its bankruptcy filing in November of 2002. On May 24, 2004 Defendants filed a Motion to Dismiss the 1st Amended Complaint. On October 15, 2004 the Court heard arguments on Defendants’ motion and on February 7, 2005 issued an Order granting the motion and granting Lead Plaintiffs leave to amend their complaint.

The original complaint was filed alleging that NextCard and certain of its officers and directors violated the Securities Exchange Act of 1934. The complaint alleges that defendants disseminated false and misleading statements concerning the Company's operations and prospects for 2000 and 2001. In fact, defendants knew NextCard's reserves were materially underfunded and that as a result, its 2000 and 2001 projections and/or results were false. During the Class Period, taking advantage of the inflation in NextCard stock, defendants Lent, Cai, Qureshey and Hashman sold almost $9 million worth of their own NextCard stock at artificially inflated prices of as much as $10.89 per share. Then, on October 31, 2001, it was revealed that, among other things, defendants had concealed that during the Class Period: (a) due to the deteriorating quality of NextCard's portfolio, the Company would need to dramatically increase its reserves for loan losses in fiscal 2000 and Q1, Q2 and Q3 2001 and as a result its reported value of its loans for fiscal 2000 and Q1 and Q2 2001 was overstated; (b) the Company had improperly recorded "credit losses" as "fraud losses" and as a result the Company's "securitization activities" during the Class Period did not qualify for "low level recourse treatment." Defendants knew that as a result, such would dramatically increase the Company bank division's risk weighted assets, and would decrease the Company's "risk based capital ratio" below federal banking guidelines – rendering the Company "significantly under capitalized"; (c) because the Company's risk-based capital ratio had plummeted below acceptable levels, it had been technically subject to a Prompt Correction Action Order and thereby restricted from accepting or reviewing any brokened deposits; (d) as a result of the above, the Company's 2000 and 2001 results and projections were materially false and misleading. These disclosures shocked the market, causing NextCard's stock to decline to $0.84 per share before closing at $0.87 per share on October 31, 2001 on volume of more than 43 million shares, inflicting millions of dollars of damage on plaintiff and the Class.

COMPANY INFORMATION:

Sector: Financial
Industry: Consumer Financial Services
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: NXCD
Company Market: NASDAQ
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-21029
JUDGE: Hon. Jeremy Fogel
DATE FILED: 11/05/2001
CLASS PERIOD START: 03/30/2000
CLASS PERIOD END: 10/30/2001
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Berman DeValerio Pease Tabacco Burt & Pucillo (MA)
    One Liberty Square, Berman DeValerio Pease Tabacco Burt & Pucillo (MA), MA 02109
    617.542.8300 ·
  2. Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR)
    P.O. Box 25438, Cauley Geller Bowman Coates & Rudman LLP (Little Rock, AR), AR 72221-5438
    501.312.8500 501.312.8505 ·
  3. Kaplan Fox & Kilsheimer, LLP (former New York, NY)
    805 Third Avenue, 22nd Floor, Kaplan Fox & Kilsheimer, LLP (former New York, NY), NY 10022
    212.687.1980 212.687.7714 · info@kaplanfox.com
  4. Kirby McInerney & Squire LLP
    830 Third Avenue 10th Floor, Kirby McInerney & Squire LLP, NY 10022
    212.317.2300 ·
  5. Leo W. Desmond
    2161 Palm Beach Lakes Boulevard, Suite 204, Leo W. Desmond, FL 33409
    561.712.8000 561.712.8000 · stocklaw@bellsouth.net
  6. Lovell Stewart Halebian LLP (former New York)
    500 Fifth Avenue, Lovell Stewart Halebian LLP (former New York), NY 10110
    212.608.1900 212.719.4677 · info@lshllp.com
  7. 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 ·
  8. 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
  9. Pomerantz LLP (New York)
    600 Third Avenue, Pomerantz LLP (New York), NY 10016
    212.661.1100 212.661.8665 · info@pomerantzlaw.com/
  10. Rabin & Peckel LLP
    275 Madison Avenue, 34th Floor, Rabin & Peckel LLP, NY 10016
    212.682.1818 212.682.1892 · email@rabinlaw.com
  11. Schatz & Nobel, P.C.
    330 Main Street, Schatz & Nobel, P.C., CT 06106
    800.797.5499 860.493.6290 · sn06106@AOL.com
  12. Schiffrin & Barroway LLP
    3 Bala Plaza E, Schiffrin & Barroway LLP, PA 19004
    610.667.7706 610.667.7056 · info@sbclasslaw.com
No Document Title Filing Date
COURT: N.D. California
DOCKET #: 01-CV-21029
JUDGE: Hon. Jeremy Fogel
DATE FILED: 04/27/2005
CLASS PERIOD START: 04/19/2000
CLASS PERIOD END: 10/30/2001
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. Bernstein Litowitz Berger & Grossmann LLP (New York, NY)
    1285 Avenue of the Americas, 33rd Floor, Bernstein Litowitz Berger & Grossmann LLP (New York, NY), NY 10019
    212.554.1400 212.554.1444 · blbg@blbglaw.com
  3. Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego)
    655 West Broadway, Suite 1900, Lerach Coughlin Stoia Geller Rudman & Robbins LLP (San Diego), CA 92101
    619.231.1058 619.231.7423 ·
  4. 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 ·
  5. 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
No Document Title Filing Date