Regions Financial Corporation ("Regions" or the Company), through its subsidiaries, provides retail and commercial banking and other financial services.
According to a press release dated October 8, 2009, the Complaint, which was filed on October 2, 2009, alleges that Regions and several of its current and former officers and directors violated Federal securities laws by allowing or authorizing the solicitation of proxies or consent to a resolution approving a merger/acquisition between Regions and AmSouth, another Birmingham-based bank, in October 2006, through the use of a materially misleading joint proxy statement. Also named as Defendants are Merrill Lynch, Price, Fenner & Smith, Inc. ("Merrill Lynch), which was Regions' financial advisor in connection with the acquisition, and Ernst & Young, LLP ("E&Y"), which served as outside auditor to both Regions and AmSouth.
The complaint alleges that the joint proxy statement, which urged shareholders to vote for the acquisition, omitted material facts about and/or falsely misrepresented AmSouth's and Regions' financial condition. False pre-merger financial statements were incorporated into the joint proxy statement and used to persuade shareholders about the benefits of the proposed combination and/or conceal the risks associated with the transaction. The statement also omitted material facts and/or contained false material representations about the benefits of merging the two banks into a single operation, the risks attended with such an acquisition or the fairness of the transaction to Regions shareholders. The Company was finally forced in January 2009 to announce a $6 billion write down of goodwill attributable to the AmSouth acquisition, approximately 60% of the $10 billion purchase price.
In accordance with the Notice of Voluntary Dismissal filed by Plaintiff, on November 13, 2009 and there being no objections by the Defendants, this action was Dismissed, Without Prejudice pursuant to Rule 41(a)(1)(i) of the Federal Rules of Civil Procedure by Order on the 17th day of November, 2009.
