According to a law firm press release, the complaint charges CIT and certain of its officers and directors with violations of the Securities Exchange Act of 1934. CIT is a leading commercial and consumer finance company, providing clients with financing and leasing products and advisory services in North America, Europe, Latin America and Asia Pacific.
The complaint alleges that during the Class Period, defendants made false and misleading statements about the Company's financial condition. Specifically, CIT's public financial statements failed to account for tens of millions of dollars in loans to Silver State Helicopter ("Silver State"), which were highly unlikely to be repaid
and should have been written off.
On March 6, 2008, Keefe, Bruyette & Woods issued an analyst report on CIT lowering its first quarter 2008 earnings per share estimate by $.08 based on concerns that CIT would have to write down a significant portion of its private student loan portfolio, including the risk that the Company would have to charge off $179 million of private student loans made to students of Silver State, which recently filed for bankruptcy. As a result, CIT's stock price dropped $4.50 to close to $15.86 on March 6, 2008.
On May 26, 2009, the Court entered the Order signed by Judge Barbara S. Jones consolidating three related actions and approving Pensioenfonds Horeca &
Catering (PH&C) as lead plaintiff and approving PH&C's selection of Coughlin Stoia Geller Rudman & Robbins LLP as lead counsel. On July 16, 2009, the lead plaintiff filed a Consolidated Complaint adding certain officers as defendants and adding claims from The Securities Act of 1933. On September 11, 2009, the defendants responded by filing a motion to dismiss the Consolidated Amended Complaint.
On November 9, 2009, defendant CIT Group Inc. filed a suggestion of bankruptcy, and on November 16, 2009, the lead plaintiff filed a Notice of Dismissal of Defendant CIT Group Inc. On June 10, 2010, the Court entered the Opinion and Order signed by Judge Barbara S. Jones denying the defendants’ motion to dismiss. The plaintiffs filed a motion to certify the class on November 19, 2010. The plaintiffs filed leave to file an amended motion for class certification, which was granted on September 9, 2011. Plaintiffs' original motion for class certification was dismissed as moot.
On March 13, 2012, a Settlement Agreement was filed with the Court. On March 16, 2012, the Court issued an Order Preliminarily Approving Settlement And Providing For Notice. On March 23, 2012, the Court issued a Revised Order Preliminarily Approving Settlement And Providing For Notice with a revised settlement hearing date.
On June 13, 2012, the Court issued an order approving the plan of allocation of settlement proceeds. On the same date, the Court issued an order awarding attorneys' fees and expenses and plaintiffs' expenses. Finally, the Court also issued the Final Judgment and Order of Dismissal With Prejudice.