Case Page

 

Case Status:    DISMISSED    
On or around 12/29/2004 (Other)

Filing Date: July 19, 2002

According to the Company’s FORM 10-K for the fiscal year ended December 31, 2004, on December 2, 2004, the Fourth Circuit Court of Appeals entered an opinion affirming the trial court and, in early 2005, plaintiffs waived their right to appeal or challenge the Fourth Circuit’s decision, ending the case.

As summarized by the same SEC filing, on October 1, 2002, the Court consolidated these twelve cases. Pursuant to the Court’s order, Plaintiffs filed an amended complaint on October 17, 2002, which alleged that the Corporation and the Individual Defendants violated Section 10(b) of the Exchange Act, Rule 10b-5 promulgated thereunder, and Section 20(a) of the Exchange Act. The amended complaint asserted a class period of January 16, 2001, through July 16, 2002, inclusive. The amended complaint alleged generally that, during the asserted class period, the Corporation misrepresented the adequacy of its capital levels and loan loss allowance relating to higher risk assets. In addition, the amended complaint alleged generally that the Corporation failed to disclose that it was experiencing serious infrastructure deficiencies and systemic computer problems as a result of its growth. On December 4, 2002, the Court granted defendants’ motion to dismiss plaintiffs’ amended complaint with leave to amend. Pursuant to that order, plaintiffs filed a second amended complaint on December 23, 2002, which asserted the same class period and alleged violations of the same statutes and rule. The second amended complaint also added a new Individual Defendant and asserted violations of GAAP. Defendants moved to dismiss the second amended complaint on January 8, 2003, and plaintiffs filed a motion on March 6, 2003, seeking leave to amend their complaint. On April 10, 2003, the Court granted defendants’ motion to dismiss plaintiffs’ second amended complaint, denied plaintiffs’ motion for leave to amend, and dismissed the consolidated action with prejudice. Plaintiffs appealed the Court’s order, opinion, and judgment to the United States Court of Appeals for the Fourth Circuit on May 8, 2003, and briefing on the appeal concluded in September 2003. Oral argument was held on February 25, 2004.

The original complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of materially false and misleading statements to the market between January 15, 2002 and July 16, 2002. According to the complaint, Capital one issued numerous press releases regarding its performance during the Class Period which represented that the Company was experiencing quarter after quarter of record earnings and revenue growth while maintaining "stringent risk management practices" and adequate loan loss reserves. The complaint further alleges that these, and other, representations were materially false and misleading because they failed to disclose that Capital One was in violation of federal guidelines regarding adequate levels of capitalization and loan loss reserves and that it was not effectively managing its rapid growth. On July 16, 2002, Capital One revealed that it had entered into an agreement with regulators, which required Capital One to boost reserves by $247 million in the second quarter of 2002, tie-up additional capital and institute infrastructure reforms in order to deal adequately with its high rate of growth, especially in the subprime market. In reaction to the announcement, Capital One's stock plummeted by 39%, falling from a $50.60 per share close on July 16 to $30.48 per share by the close of July 17, on extremely heavy trading volume. During the Class Period, as alleged in the complaint, Capital One insiders, including defendant Willey, profited by selling a total of over $8.2 million in Capital One common stock at artificially inflated prices and the Company undertook a convertible debt offering for $650 million on April 19, 2002.

COMPANY INFORMATION:

Sector: Financial
Industry: Regional Banks
Headquarters: United States

SECURITIES INFORMATION:

Ticker Symbol: COF
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: E.D. Virginia
DOCKET #: 02-CV-1069
JUDGE: Hon. James C. Cacheris
DATE FILED: 07/19/2002
CLASS PERIOD START: 01/15/2002
CLASS PERIOD END: 07/16/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Cohen Gettings P.C.
    2200 Wilson Boulevard - Suite 800, Cohen Gettings P.C., VA 22201
    703.525.2260 ·
  2. Faruqi & Faruqi LLP (New York) (former)
    320 East 39th Street, Faruqi & Faruqi LLP (New York) (former), NY 10016
    212.983.9330 212.983.9331 · Nfaruqi@faruqilaw.com
  3. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
No Document Title Filing Date
COURT: E.D. Virginia
DOCKET #: 02-CV-1069
JUDGE: Hon. James C. Cacheris
DATE FILED: 12/23/2002
CLASS PERIOD START: 01/16/2002
CLASS PERIOD END: 07/16/2002
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC)
    1100 New York Avenue, N.W., Suite 500, West Tower, Cohen, Milstein, Hausfeld & Toll, P.L.L.C. (Washington, DC), DC 20005
    202.408.4600 202.408.4699 · lawinfo@cmht.com
  2. Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY)
    One Pennsylvania Plaza, Milberg Weiss Bershad Hynes & Lerach LLP (New York, NY), NY 10119-1065
    212.594.5300 ·
  3. Wolf Haldenstein Adler Freeman & Herz LLP (New York)
    270 Madison Avenue, Wolf Haldenstein Adler Freeman & Herz LLP (New York), NY 10016
    212.545.4600 212.686.0114 · newyork@whafh.com
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