Case Page

 

Case Status:    DISMISSED    
On or around 08/15/2005 (Other)

Filing Date: January 21, 2004

According to a press release dated June 9, 2005, in a ruling that strictly enforces the "particularity" requirements of the Private Securities Litigation Reform Act, a federal judge has dismissed a class action suit against top executives at American Business Financial Services Inc. after finding that the plaintiffs lacked detailed evidence to back up their claim that false and misleading statements were made to investors. In the suit, investors allege that ABFS - a now-bankrupt financial services company that specialized in home equity loans - used improper accounting practices to hide its high rate of delinquent loans.

The Complaint alleges that defendants ABFI violated Sections 10(b) and 20(a) of the
Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. More
specifically, the Complaint alleges that, during the Class Period, defendants
failed to disclose and indicate (1) the Company used a deception to take homes
from delinquent borrowers in order keep its delinquency rate low; (2) that the
deception allowed the Company to skip the normal foreclosure process more
frequently; (3) that the deception helped the Company to reduce its delinquency
rate in its $3.6 billion loan portfolio; (4) as result of reducing its
delinquency rate in its $3.6 billion loan portfolio, the Company was able to
securitize more loans; and (5) were thus able to collect interest income from
its securitized loans and inflate its financial results.

Further, the press release said that, on June 13, 2003, the Company disclosed that it had received a civil subpoena
from the U.S. Department of Justice requesting that ABFI provide documents
relating to mortgage loan transactions and securitization agreements. On news
of this, shares of ABFI fell 20% to close at $8.27 per share. On June 26, 2003,
ABFI disclosed that it anticipated incurring a loss for the quarter and year
ended June 30, 2003 due to its inability to complete its quarterly
securitization of loans. On news of this, shares of ABFI fell 12% to close at
$7.40 per share.

COMPANY INFORMATION:

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

SECURITIES INFORMATION:

Ticker Symbol: ABFI
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: E.D. Pennsylvania
DOCKET #: 04-CV-265
JUDGE: Hon. Harvey Bartle
DATE FILED: 01/21/2004
CLASS PERIOD START: 01/27/2000
CLASS PERIOD END: 06/25/2003
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Cauley Geller Bowman Coates & Rudman, LLP (New York)
    200 Broadhollow, Suite 406, Cauley Geller Bowman Coates & Rudman, LLP (New York), NY 11747
    631.367.7100 631.367.1173 ·
  2. Law Offices of Brian M. Felgoise, P.C.
    Esquire at 261 Old York Road, Suite 423, Law Offices of Brian M. Felgoise, P.C., PA 19046
    215.886.1900 · securitiesfraud@comcast.net
  3. Law Offices of Charles J. Piven, P.A.
    World Trade Center-Baltimore,401 East Pratt Suite 2525, Law Offices of Charles J. Piven, P.A., MD 21202
    410.332.0030 · pivenlaw@erols.com
  4. Law Offices of Marc S. Henzel (Lawrence)
    335 Central Avenue, Law Offices of Marc S. Henzel (Lawrence), NY 11559
    516.374.0707 516.295.3473 · securitiesfraud@comcast.net
  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
  6. Murray, Frank & Sailer LLP
    275 Madison Ave 34th Flr, Murray, Frank & Sailer LLP, NY 10016
    212.682.1818 212.682.1892 · email@murrayfrank.com
  7. 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: E.D. Pennsylvania
DOCKET #: 04-CV-265
JUDGE: Hon. Harvey Bartle
DATE FILED: 08/19/2004
CLASS PERIOD START: 01/27/2000
CLASS PERIOD END: 06/26/2003
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Geller Rudman, PLLC.
    197 South Federal Highway, Suite 200, Geller Rudman, PLLC., FL 33432
    561.750.3000 888.262.3131 · info@geller-rudman.com
  2. 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
No Document Title Filing Date