On May 24, 2007, the Court entered the Order from the U.S. Court of Appeals. According to the Order, the parties have filed a stipulation to dismiss. The court dismisses this appeal, upon such terms as have been agreed to by the parties
After Judgment in favor of the defendants and against the plaintiff was entered on April 27, 2006, the plaintiff filed a Notice of Appeal on May 23, 2006. The appeal is currently pending in the Fourth Circuit Court of Appeals.
According to a press release dated May 23, 2006, a federal court has dismissed a class-action securities-fraud complaint against Hilb Rogal & Hobbs, a Richmond-based insurance broker. The Iron Workers Local 16 Pension Fund sought to represent a class of plaintiffs and asserted that the company violated securities law. But the U.S. District Court for the Eastern District of Virginia found that the plaintiffs failed to show that the company made material misstatements or omissions. The court said the plaintiffs lacked the facts to support claims of securities fraud.
In a press release dated October 25, 2005, Labaton Sucharow & Rudoff LLP filed an amended class action complaint yesterday in the United States District Court for the Eastern District of Virginia, on behalf of those who purchased or acquired the securities of Hilb Rogal & Hobbs Co. between August 11, 2000 and May 26, 2005, inclusive. The lawsuit was filed against HRH and certain of its present and former executive officers.
Several purported shareholder class action lawsuits have been filed against Hilb Rogal & Hobbs Co. and certain of its present and former executive officers.
Specifically, the complaint alleges that defendants violated the federal securities laws by issuing a series of false and misleading statements in its quarterly and annual filings with the Securities and Exchange Commission. Plaintiff specifically alleges that defendants violated the federal securities laws by failing to disclose that: a) the company was paying or receiving the equivalent of kickbacks when placing its clients' insurance business; b) the Company's contingent and override commissions were designed to steer its business to insurance carriers who provided kickbacks; c) the Company's business practices were against the interests of its clients, were fraudulent and illegal, and could potentially result in civil and/or criminal liability; and d) a substantial portion of the Company's revenues were derived from kickbacks and improper commissions, making the Company's financial statements substantially inflated throughout the Class Period.
The complaint further alleges that on or around May 26, 2005, the Company announced that its Chief Operating Officer had resigned following an internal review of business practices. This review discovered that the Company made improper payments out of Hilb Rogal's Hartford offices related to the placement of insurance policies. In reaction to this revelation, Hilb Rogal's share price fell $4.51 on May 27, 2005, down nearly 12 percent from its prior closing price, thereby damaging plaintiff and the Class.