Securities class action filed on behalf of a class of all persons and entities who purchased or acquired publicly-traded securities of Lehman Brothers Holdings Inc. ("Lehman" or the "Company") between June 12, 2007 and September 15, 2008 (the "Class Period").
On July 31, 2008, the Honorable Lewis A. Kaplan appointed BLB&G client the Government of Guam Retirement Fund as co-Lead Plaintiff and BLB&G as co-Lead Counsel for the Class.
This action arises from Lehman Brothers Holdings Inc.'s ("Lehman" or the "Company") lack of transparency and undisclosed exposure to losses from its massive real estate and mortgage portfolio. At the same time, its officers repeatedly and publicly distinguished Lehman from its peers, downplaying its exposure to mortgage-related losses, noting its strong capital base, and emphasizing its superior hedging and risk management practices. Lehman, once one of the nation's most prominent financial institutions, was a major participant in all aspects of the mortgage and real estate markets, including originating residential and commercial mortgages, securitizing loans, marketing asset-backed instruments to investors, and investing directly in real estate. As revelations of delinquencies and defaults in the U.S. mortgage markets mounted and the credit markets declined, however, Lehman 's disclosures continued to mask its exposure to mortgage-related losses.
Ultimately, the truth about Lehman's financial condition was revealed through a series of partial disclosures and events setting forth Lehman's exposure to illiquid mortgage-related assets and its lack of liquidity. As a result, Lehman's stock price plummeted. Finally, despite claiming on September 10, 2008 that the Company did not need additional capital, Lehman filed a petition for bankruptcy on September 15, 2008. Lehman's bankruptcy is the largest in U.S. history.
On October 27, 2008, Lead Plaintiffs filed an Amended Class Action Complaint for Violations of the Federal Securities Laws ("Complaint") on behalf of all persons and entities who purchased or acquired publicly-traded securities of Lehman during the Class Period. The Complaint asserts federal securities claims against several former Lehman officers (including Richard S. Fuld, Jr., the former Chief Executive Officer and Chairman of the Board), several members of Lehman's Board of Directors, and underwriters for various Lehman debt and equity offerings during the Class Period.
