NEW YORK, Aug. 28, 2013 LawFuel.com – Best Law Firm Newswire — Pomerantz Grossman Hufford Dahlstrom & Gross LLP has filed a class action lawsuit against The First Marblehead Corp. (“First Marblehead” or the “Company”) (NYSE: FMD) and certain of its officers.
The class action, filed in United States District Court, District of Massachusetts, and docketed under 13-cv-12121-PBS, is on behalf of a class consisting of all persons or entities who purchased or otherwise acquired securities of First Marblehead between November 4, 2010 and August 15, 2013 both dates inclusive (the “Class Period”). This class action seeks to recover damages against the Company and certain of its officers and directors as a result of alleged violations of the federal securities laws pursuant to Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder.
If you are a shareholder who purchased First Marblehead securities during the Class Period, you have until October 28, 2013 to ask the Court to appoint you as Lead Plaintiff for the class. A copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at [email protected] or 888.476.6529 (or 888.4-POMLAW), toll free, x237. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and number of shares purchased.
First Marblehead is a specialty finance company focused on education loan programs for K-12, undergraduate and graduate students in the United States, as well as tuition planning, tuition billing, refund management and payment technology services. The Company partners with lenders to design and administer education loan programs, which are typically school-certified and marketed through educational institutions or prospective student borrowers and their families directly, and to generate portfolios intended to be held by the originating lender or financed in the capital markets. First Marblehead also offers a number of ancillary services in support of its clients, including loan origination, retail banking, portfolio management and securitization services.
The Complaint alleges that throughout the Class Period, Defendants made false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and financial performance. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (1) the Company’s tax treatment for its sale of the Trust Certificate and similarly situated securities was inappropriate; (2) such treatment exposed the Company to significant liability, threatening the future viability of the Company; (3) the Company lacked adequate internal controls over financial reporting; and (4) as a result of the foregoing, the Company’s financial statements were materially false and misleading at all relevant times.
On August 15, 2013, in its press release announcing quarterly results for the fiscal year ended June 30, 2013, the Company disclosed that the tax liability related to its IRS audit would amount to $300 million, more than the Company’s reported cash on hand, and nearly double its market capitalization. On this news, First Marblehead shares declined $0.57 per share or over 36%, to close at $1.00 per share on August 16, 2013.
The Pomerantz Firm, with offices in New York, Chicago, Florida, and San Diego, is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 70 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.