Friedman, Billings, Ramsey Group, Inc. ("FBR" or the Company) is an investment bank that provides investment banking, institutional brokerage and asset management services, and invests as principal in mortgage-backed securities and merchant banking investments.

Several purported shareholder class action lawsuits have been filed against FBR and certain of its present and former executive officers with violations of the Securities Exchange Act of 1934. The Complaint alleges that FBR violated federal securities laws by making materially false or misleading public statements. Specifically, the Complaint alleges that FBR did not properly disclose the adverse effect of an SEC and NASD investigation into FBR's 2001 role as a placement agent for an issuer in a PIPE (private investment in public equity) transaction. On November 9,2004, FBR filed its third quarter 2004 Form 10-Q in which it disclosed this SEC and NASD investigation. On this news, FBR's stock dropped to $16.93 per share. On April 4, 2005, Emanuel J. Friedman, FBR's CEO, resigned. Then, on April 25, 2005, FBR announced disappointing preliminary results for the first quarter 2005, including a charge for its liability in the PIPE transaction. On this news, FBR's stock dropped to $12.52 on volume of 7.5 million shares.

On January 25, 2006, the Court entered the Memorandum and Opinion signed by Richard J. Holwell consolidating the actions, appointing Operating Engineers Trust as lead Plaintiff, and designating Lerach Coughlin Stoia Geller Rudman & Robbins LLP lead Counsel. On April 3, 2006, a Consolidated Amended Complaint was filed, and on June 2, 2006, the Defendants filed a motion to dismiss the Consolidated Amended Complaint. The motion was then pending before the Court.

According to an article dated April 1, 2008, a federal court has dismissed a consolidated securities class action against FBR, ruling that the Plaintiffs had failed to properly plead their claims of securities law violations stemming from the investment bank’s CompuDyne Corp. PIPE deal. Judge Richard J. Holwell of the U.S. District Court for the Southern District of New York granted FBR’s motion to dismiss the Plaintiffs’ consolidated amended Complaint, but gave the Plaintiffs 30 days to seek leave to replead their case.

On July 30, 2008, an order of dismissing the case with prejudice was entered and the case is therefore closed.