Class action suit filed against Northern Trust Corporation
24 August 2010 San Diego
Image: Shutterstock
Robbins Geller Rudman & Dowd LLP today announced that a class action has been commenced on behalf of an institutional investor in the United States District Court for the Northern District of Illinois on behalf of purchasers of Northern Trust Corporation ("Northern Trust") common stock during the period between October 17, 2007 and October 20, 2009 (the "Class Period").
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Darren Robbins of Robbins Geller at +1 800 449 4900 or +1 619 231 1058, or via e-mail at djr@rgrdlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/northerntrust/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Northern Trust and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Northern Trust is a financial holding company that provides asset servicing, fund administration, investment management, banking and fiduciary solutions for corporations, institutions and affluent individuals worldwide.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results and engaged in improper behavior that harmed Northern Trust's investors by failing to disclose the extent of its seriously delinquent commercial real estate loans and the true nature and risks associated with its once highly profitable securities lending program. As a result of defendants' false statements, Northern Trust's stock traded at artificially inflated prices during the Class Period, reaching a high of $87.20 per share on September 11, 2008. While Northern Trust's stock was artificially inflated due to defendants' false statements, certain top officers and directors of the Company sold over 1.5 million shares of their Northern Trust stock for proceeds of over USD106.5 million.
Then, on October 21, 2009, before the market opened, Northern Trust reported its third quarter 2009 earnings results, announcing third quarter results that fell short of expectations due in part to a serious decline in the Company's securities lending program and to continuing pressure from its non-performing loans. On this news, Northern Trust's stock fell USD3.29 per share to close at USD54.16 per share on October 21, 2009, a one-day decline of nearly 6% on volume of over 8.55 million shares.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows:
(a) defendants failed to properly account for Northern Trust's commercial real estate loans, failing to reflect impairment in the loans; (b) Northern Trust had not adequately reserved for loan losses such that its financial statements were presented in violation of Generally Accepted Accounting Principles
(c) Northern Trust had not disclosed the true risk associated with the Company's securities lending program, as the Company was engaging in excessively risky investment practices by investing collateral pools in high risk investments
(d) the disruption to the Company's securities lending program was not temporary and would significantly impact the Company's business and outlook
and
(e) the deterioration in the Company's operating results from its securities lending business was not primarily attributable to negative returns associated with one of its collateral funds that used mark-to-market accounting or to a decline in overall borrowing demand, but rather, in large part, to an overall decline in the supply of securities available for loans.
Plaintiff seeks to recover damages on behalf of all purchasers of Northern Trust common stock during the Class Period (the "Class"). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller, a 180-lawyer firm with offices in San Diego, San Francisco, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Robbins Geller Web site (http://www.rgrdlaw.com) has more information about the firm.
SOURCE: Robbins Geller Rudman & Dowd LLP
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Darren Robbins of Robbins Geller at +1 800 449 4900 or +1 619 231 1058, or via e-mail at djr@rgrdlaw.com. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/northerntrust/. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
The complaint charges Northern Trust and certain of its officers and directors with violations of the Securities Exchange Act of 1934. Northern Trust is a financial holding company that provides asset servicing, fund administration, investment management, banking and fiduciary solutions for corporations, institutions and affluent individuals worldwide.
The complaint alleges that during the Class Period, defendants issued materially false and misleading statements regarding the Company's business and financial results and engaged in improper behavior that harmed Northern Trust's investors by failing to disclose the extent of its seriously delinquent commercial real estate loans and the true nature and risks associated with its once highly profitable securities lending program. As a result of defendants' false statements, Northern Trust's stock traded at artificially inflated prices during the Class Period, reaching a high of $87.20 per share on September 11, 2008. While Northern Trust's stock was artificially inflated due to defendants' false statements, certain top officers and directors of the Company sold over 1.5 million shares of their Northern Trust stock for proceeds of over USD106.5 million.
Then, on October 21, 2009, before the market opened, Northern Trust reported its third quarter 2009 earnings results, announcing third quarter results that fell short of expectations due in part to a serious decline in the Company's securities lending program and to continuing pressure from its non-performing loans. On this news, Northern Trust's stock fell USD3.29 per share to close at USD54.16 per share on October 21, 2009, a one-day decline of nearly 6% on volume of over 8.55 million shares.
According to the complaint, the true facts, which were known by the defendants but concealed from the investing public during the Class Period, were as follows:
(a) defendants failed to properly account for Northern Trust's commercial real estate loans, failing to reflect impairment in the loans; (b) Northern Trust had not adequately reserved for loan losses such that its financial statements were presented in violation of Generally Accepted Accounting Principles
(c) Northern Trust had not disclosed the true risk associated with the Company's securities lending program, as the Company was engaging in excessively risky investment practices by investing collateral pools in high risk investments
(d) the disruption to the Company's securities lending program was not temporary and would significantly impact the Company's business and outlook
and
(e) the deterioration in the Company's operating results from its securities lending business was not primarily attributable to negative returns associated with one of its collateral funds that used mark-to-market accounting or to a decline in overall borrowing demand, but rather, in large part, to an overall decline in the supply of securities available for loans.
Plaintiff seeks to recover damages on behalf of all purchasers of Northern Trust common stock during the Class Period (the "Class"). The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.
Robbins Geller, a 180-lawyer firm with offices in San Diego, San Francisco, New York, Boca Raton, Washington, D.C., Philadelphia and Atlanta, is active in major litigations pending in federal and state courts throughout the United States and has taken a leading role in many important actions on behalf of defrauded investors, consumers, and companies, as well as victims of human rights violations. The Robbins Geller Web site (http://www.rgrdlaw.com) has more information about the firm.
SOURCE: Robbins Geller Rudman & Dowd LLP
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