E*Trade Financial: Lead Plaintiffs & Counsel Named In N.Y. Suit

E*Trade Financial: Lead Plaintiffs & Counsel Named In N.Y. Suit - 9/5/2008

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DISMISSAL NEWS:

E*Trade Financial: Lead Plaintiffs & Counsel Named In N.Y. Suit
Staff Writer

Sunstream News. September 5, 2008
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EXCERPT: The U.S. District Court for the Southern District of New York appointed the "Kristen-Straxton Group" and Ira Newman as co-lead plaintiffs, and the law firms of Brower Piven and Levi & Kersinski, as the lead and co-lead plaintiffs' counsel in a consolidated lawsuit against E*Trade Financial Corp. Initially, on Oct. 2, 2007, a class action complaint alleging violations of the federal securities laws was filed in the U.S. District Court for the Southern District of New York against the company and its chief executive officer and chief financial officer (Class Action Reporter, July 25, 2008). The suit was entitled "Larry Freudenberg, Individually and on Behalf of All Others Similarly Situated, Plaintiff, versus E*TRADE Financial Corporation, Mitchell H. Caplan and Robert J. Simmons, Defendants." The plaintiff contends, among other things, that between Dec. 14, 2006, and Sept. 25, 2007, the defendants: -- issued materially false and misleading statements and failed to disclose that the company was experiencing a rise in delinquency rates in its mortgage and home equity portfolios; -- failed to timely record an impairment on its mortgage and home equity portfolios and materially overvalued its securities portfolio, which includes assets backed by mortgages; and -- based on the foregoing, lacked a reasonable basis for the positive statements it made about the company's earnings and prospects.

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