According to a press release dated January 05, 2009, the complaint charges certain of PFF’s officers and directors with violations of the Securities Exchange Act of 1934. PFF operates as a holding company for PFF Bank & Trust, which provides community banking services to individuals and companies in Southern California.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company’s business and financial results and engaged in improper behavior, which harmed PFF’s customers and investors in its common stock, including lending to borrowers with little ability to repay the amount loaned and failing to inform investors of the impact of changes in the real estate market in San Bernardino and Riverside counties. As a result of defendants’ false statements, PFF’s stock traded at artificially inflated prices during the Class Period, reaching a high of $35.45 per share in December 2006.
On November 21, 2008, after the market closed, the Bank was closed by regulators and taken over by U.S. Bancorp. Following this announcement, PFF’s stock declined to $0.01 per share – a total loss for investors.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows: (a) PFF’s assets contained hundreds of millions of dollars worth of impaired and risky securities, many of which were backed by real estate that was rapidly dropping in value; (b) prior to and during the Class Period, PFF had been extremely aggressive in generating loans, including being heavily involved in offering Home Equity Lines of Credit, which would be enormously problematic if the value of residential real estate did not continue to increase; (c) defendants failed to properly account for PFF’s real estate loans, failing to reflect impairment in the loans; (d) PFF’s business prospects were much worse than represented due to problems in the Inland Empire market, which was a key focus of PFF’s business; and (e) PFF had not adequately reserved for loan losses on HELOCs and on other real estate-related assets.
On September 14, 2009, the Court granted the motion for appointment as lead plaintiff filed by the Plaintiffs and approved their selection of lead counsel.
On October 10, 2010, a first amended complaint was filed by the plaintiffs against defendants.
On February 08, 2010, an Order by Judge Andrew J. Guilford on the Motion to dismiss was granted. Since Defendants have not established that there is no possibility Plaintiffs could cure the Complaint’s deficiencies, Plaintiffs shall have leave to amend their Complaint.
On March 8, 2010, a second amended complaint was filed by the plaintiffs against the defendants.
On August 9, 2010, the Court denied defendants' motion to dismiss the second amended complaint.
On March 26, 2012, the Court entered an Order preliminarily approving the Stipulation of Settlement.
On July 9, 2012, the Court issued an Order Approving Plan of Allocation of Settlement Proceeds. On the same date, the Court also issued an order awarding attorneys' fees and expenses.
On July 9, 2012, the Court entered a Final Judgment and issued an order of dismissal with prejudice.