Case Page

 

Case Status:    DISMISSED    
On or around 12/10/2015 (Court's order of dismissal)

Filing Date: May 20, 2013

According to the law firm press release, Cash Store is a pay-day lender based in Alberta, Canada. The Company primarily operates in Canada, where it maintains 579 branches under the banners "Cash Store Financial" and "Instaloans."

The securities class action charges that, throughout the Class Period, Cash Store made a series of false and misleading statements concerning the Company's financial condition that caused the Company's shares to trade at an artificially high price. Specifically, the complaint alleges that Cash Store made a number of false and misleading statements in its quarterly and annual financial statements in which it overvalued a major loan portfolio it had acquired. Additionally, the Company understated its liabilities associated with a class action settlement.

On December 10, 2012, the Company revealed that it needed to restate its financial statements and that it had inappropriately accounted for the acquisition of a large loan portfolio in violation of U.S. Generally Accepted Accounting Principles ("GAAP"). Specifically, the Company determined that a $36.8 million premium should have been recorded as an expense. The Company further stated that it was going to restate the fair value of the loans acquired to $50 million from which the Company had paid $116.3 million and that its provision for loan losses for the three month periods ending March 31, 2012 and June 30, 2012 was understated by $3.3 million and $3.7 million, respectively. Significantly, the Company admitted that material weaknesses existed as to the Company's internal controls and that such weaknesses led to the restatement.

On February 13, 2013, Cash Store announced that it would again have to restate financial statements because the previous annual and interim financial statements improperly calculated the losses accrued due to a lawsuit settlement. Although every financial statement filed with the SEC estimated liability relating to the lawsuit to be approximately $18 million, in reality the losses were $23.3 million – or approximately 25% higher than previously reported. The Company admitted that its previous financial reports should not be relied upon and that material weaknesses in internal controls for accounting existed during all periods dating back to 2010.

The complaint alleges that, as a result of the foregoing, Cash Store stock plummeted approximately 71.25%, from its Class Period high of $17.10 per share to $3.83 per share at the close of the Class Period, resulting in millions of dollars of losses to class members.

A consolidated complaint was filed on November 18, 2013.

Pursuant to a stipulation of the parties, this case was ordered dismissed with prejudice on December 10, 2015.

COMPANY INFORMATION:

Sector: Financial
Industry: Consumer Financial Services
Headquarters: Canada

SECURITIES INFORMATION:

Ticker Symbol: CSFS
Company Market: New York SE
Market Status: Public (Listed)

About the Company & Securities Data


"Company" information provides the industry and sector classification and headquarters state for the primary company-defendant in the litigation. In general, "Securities" information provides the ticker symbol, market, and market status for the underlying securities at issue in the litigation.

In most cases, the primary company-defendant actually issued the securities that are the subject of the litigation, and the securities information and company information relate to the same entity. In a small subset of cases, however, the primary company-defendant is not the issuer (for example, cases against third party brokers/dealers), and the securities information and company information do not relate to the same entity.
COURT: S.D. New York
DOCKET #: 13-CV-03385
JUDGE: Hon. Victor Marrero
DATE FILED: 05/20/2013
CLASS PERIOD START: 11/24/2010
CLASS PERIOD END: 05/13/2013
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Hoffner PLLC
    325 Broadway, Suite 505 , Hoffner PLLC , NY 10007
    (212) 941-8137 (212) 941-8137 ·
No Document Title Filing Date
COURT: S.D. New York
DOCKET #: 13-CV-03385
JUDGE: Hon. Victor Marrero
DATE FILED: 11/18/2013
CLASS PERIOD START: 11/24/2010
CLASS PERIOD END: 09/26/2013
PLAINTIFF FIRMS NAMED IN COMPLAINT:
  1. Hoffner PLLC
    325 Broadway, Suite 505 , Hoffner PLLC , NY 10007
    (212) 941-8137 (212) 941-8137 ·
  2. Kirby McInerney LLP (New York)
    825 Third Avenue, Kirby McInerney LLP (New York), NY 10022
    212.371.6600 212.371.6600 ·
No Document Title Filing Date
No Document Title Filing Date