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Ocwen Financial hit with securities fraud lawsuit

Mortgage originators and servicers have come under fire for charging home owners exorbitant insurance premiums when the servicer force places insurance on home owners, primarily because the mortgage servicer charges a huge insurance premium and then receives a kick back from the insurance company.  Ocwen senior executives apparently took this one step further:  They allegedly directly at least $60 million per year in these so-called earned insurance fees and rather than place them on Ocwen’s balance sheet, the senior executives diverted those fees to Altisource - a company owned and controlled by Ocwen’s Chairman of the Board.  This securities fraud class action then addresses the question of whether these related transactions constitute securities fraud against Ocwen shareholders.

Yelp shareholder sues re securities fraud

The cornerstone of Yelp’s business is the even-handed aggregation of properly screened, truly authentic, first-hand reviews of local businesses.  What if the screening process is less than optimal allowing unacceptable negative reviews?  What if Yelp conveniently offers local businesses the chance to pay to place an ad where those negative reviews would otherwise be located?   What if investors were mislead about all this?  These are some of the questions that this securities fraud class action will address.

Bally Technologies acquisition under review

Scientific Games Corporation and Bally Technologies, Inc. (NYSE: BYI) ("Bally") today announced that the companies have entered into a definitive merger agreement whereby Scientific Games has agreed to acquire all of the outstanding Bally common stock for $83.30 in cash per share. The aggregate transaction value is approximately $5.1 billion, including the refinancing of approximately $1.8 billion of existing Bally net debt.

Pike merger under review for fairness

The Pike Corporation (NYSE:PIKE) board of directors has agreed to sell the company to the the current CEO and an investment firm.  If the deal stands, each Pike shareholder would receive $12.00 in cash for each share of stock they own.  The transaction as structured between Court Square Capital Partners and Pike Corporation represents a total transaction value of approximately $595 million, consisting of an equity value of approximately $395 million and net debt of approximately $200 million.

Galectin Therapeutics sued by shareholder for securities fraud

Galectin Therapeutics is accused of hiring a rather notorious penny stock promoter to pump up its stock price.  If true, this may not only be securities fraud, but is also just plain dumb. 

Penn West sued for securities fraud re accounting errors

When an oil & gas company announces accounting errors, 99% of the time the company has overstated goodwill regarding recognized reserves or misallocated operating expenses as capital expenses.  Penn West disclosed that it would need to change its financial statements because it did the latter.  Moreover, these accounting changes may put the company at risk of defaulting on certain debt covenants.  

Shareholder sues EDAP for securities fraud

Comparing data from patents in the same study when analyzing test data can be appropriate to reach conclusions about efficacy and safety of a drug or medical device.  Comparing data from patients from two different studies rarely is an acceptable statistical method.  This is what the FDA has accused EDAP of doing when EDAP presented data on Ablatherm.  This securities fraud case addresses the question of whether senior executives knowingly made this apparent mistake to overstate the efficacy of Ablatherm.

WWE sued for securities fraud

In May, 2014, most WWE investors were expecting a lucrative indeed huge  long term TV contract.  WWE investors lost 100s of millions in value in one day when the actual TV deal terms were announced.  This securities fraud lawsuit addresses the question of whether senior executives knowingly overstated the anticipated value of the TV contract during the stock run up prior to the actual terms of the TV deal being announcement to investors.

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