Securities
Q: What is a class action?
A class action is a representative lawsuit that permits one person or a group (the plaintiff), who have all suffered a harm that is similar or the same, to sue the responsible party or parties (the defendant) for that damage. Bringing a suit in this manner allows a person with relatively small losses to see compensation when an individual action might not be practical. Additionally, participating in a class action allows small shareholders to litigate effectively and equally with large corporations
Q: What is a securities class action?
A securities class action is a class action suit filed by investors who purchased securities offered by a company and who suffered economic damages often due to false or misleading statements regarding a company’s business that caused the company’s stock to trade at higher prices than it otherwise would have. Securities class actions are generally brought under the anti-fraud provisions of the Securities Act of 1933 and the Securities and Exchange Act of 1934.
Q: What is a class period?
A class period is the term used to refer to the span of time during which the company’s directors, or other executives, are alleged to have been engaged in wrongful conduct. You are considered to be a member of the class if you purchased the company’s securities during this period of time.
Q: What are the benefits of a securities class action?
Pursing a securities law suit such as a class action allows many investors who would never have brought an individual action to seek recovery of their losses without having to individually retain a lawyer and incur large legal expenses. In general, it is more cost efficient for investors to pursue their securities claims as part of a larger class, rather than pursuing them individually.
Q: How do I know if I have a securities fraud claim?
If you purchased a publicly traded security and the value of that security decreased after negative information about the company was disclosed, you may have a claim. Contact Abraham Fruchter & Twersky LLP to discuss your potential claim.
Q: Can I participate in a securities class action if I purchased shares in my 401 (k) or IRA account?
Yes, providing that the shares were purchased during the class period.
Q: Can I participate in the lawsuit if I acquired my shares via a merger or other stock transaction?
Yes, providing that the shares were acquired during the class period.
Q: Do I have to hold on to my shares once the claim is filed?
No, you do not need to hold onto your shares.
Q: May I file a securities class action claim if I know that a claim has already been filed?
Yes, you may. Even if a claim has already been filed, you have the right to choose the best lawyers to pursue your claim. Selecting lawyers with experience and expertise in the field, like the seasoned and skilled attorneys at Abraham Fruchter & Twersky LLP, ensures that your claim will be properly pursued.
Q: How long should I expect the lawsuit to take before it’s resolved?
The duration of lawsuits varies. A typical class action suit will be resolved in one to four years. This, of course, is only a generalization. Some cases settle soon after the claim is filed, while other eventually go to trial.
Q: How much will it cost for me to initiate or join a securities class action suit?
Abraham Fruchter & Twersky LLP typically conducts class actions suits on a contingency fee basis. That means that the firm, if successful in securing a recovery for the class, will be paid by the court out of any settlement or other award.
Securities - Shareholder Derivative Suit
Q: What is a shareholder derivative suit?
A shareholder derivative suit is a lawsuit brought by a shareholder of a company, on behalf of the company, to enforce a cause of action against a third party, who is typically an officer or director. Derivative actions are often brought when a company is not enforcing rights it possesses against third parties. Generally, this is because the officers and directors of a corporation do not want to bring suit against a colleague, even if such a lawsuit is appropriate.
Q: What kinds of claims are generally brought in a shareholder derivative suit?
Derivative suits usually involve claims related to mismanagement. Generally, these claims relate to the wasting of corporate assets or breaches of fiduciary duty.
Q: Can I bring a derivate suit if I’ve sold my shares?
No, you must be a current shareholder to bring a shareholder derivative suit, and you must continue to hold your shares for the duration of the suit.
Q: How much will it cost me to initiate a shareholder derivative suit?
Derivative suits are also pursued on a contingency fee basis. Therefore, the firm will recover expenses and obtain a fee based on what a court approves. The plaintiff will not have to pay any fees directly.
Consumer Fraud
Q: What is consumer fraud?
Consumer fraud includes a wide range of improper practices involving the advertising, marketing, selling, and provision of goods or services. Examples of instances of consumer fraud include but are not limited to: when a product or service does not perform, or is not performed, to the manner in which it was advertised, when a company interprets a contract or agreement in a manner that is exceptionally disadvantageous to the consumer, or when a company overcharges or falsely charges consumers for a product or service.
Q: I feel I have been the victim of consumer fraud. What course of action should I take?
First and foremost, as a consumer, you should try dealing with the company directly. Contact them, explain the problem, and try and get it resolved. It is important to remember to be persistent and not rely solely on what the individual answering the phone tells you, for often times, that person lacks the authority to fully consider and amend the situation. If such is the case, ask to speak with superior officers in the hopes that someone else can help rectify the situation.
Sometimes, however, this initial course of action is not enough. In that case, there are numerous organizations (both private and governmental) that you can turn to about your specific issue. For example, most states have boards, administrations, or agencies devoted exclusively to handling issues related to consumer protection, while the federal government has agencies such as the Federal Trade Commission and the Better Business Bureau (among others) to assist consumers in these issues.
However, if you feel that you have suffered substantial damages, or you feel that your grievance is one that is potentially shared by a number of people, you might want to contact a lawyer with experience in these consumer fraud matters, such as one of the skilled attorneys at Abraham Fruchter & Twersky LLP. If you do decide to seek legal counsel on this matter, you should be as meticulous as possible in documenting specific instances of the matter in question. This documentation includes but is not limited to: receipts for the product/service in question, any correspondence with the company, photographs, etc. Concrete documentation like this will better aid in the prosecution of your claim.
Q: What are the benefits of a consumer fraud class action?
A class action positions an individual plaintiff in a much stronger position of litigation against the defense. By joining a class action, the individual no longer stands alone but rather stands as part of a larger group of complaints that pose a greater potential financial liability to the defendant than does the individual by him or herself. As a result, defendants are forced to take the individuals grievances much more seriously.
Q: Who may bring a class action?
A class action may be brought by anyone who has been individually harmed or injured by a particular person or organization acting in violation of the law, and who has claims that are similar to other class members and has no outstanding conflicts of interest with other class members. To participate in the class action, one must obtain competent, experienced legal counsel, like that provided by Abraham Fruchter & Twersky LLP. This individual class representative must be knowledgeable about the issues of the lawsuit, able to effectively communicate and consult with his or her attorneys regarding the case, and be ready, willing, and able to execute affidavits and appear at depositions or trials as deemed necessary.
Q: What types of claims are commonly litigated in consumer fraud class actions?
Consumer fraud class actions occur when speculation regarding the unfair business practices of a company arises. Improper advertising, marketing, sales, distribution, or over charging of goods all are considered unfair business practices and are thus often the claims behind many of these class action suits. Additionally, consumer fraud class actions also can deal with situations in which a company performs form contracts (insurance contracts, mortgages, loan agreements, etc) in a manner disadvantageous to the consumer. It is important to note, however, that the essential component of a legitimate class action complaint is a certain degree of deception on the part of the defendant, and not merely customer dissatisfaction with a product or service.
Q: I believe that I have a claim. How do I bring a consumer fraud class action suit?
Contact Abraham Fruchter & Twersky LLP, explain your situation, and one of the members of our legal team will personally assess your situation to determine if such a lawsuit would be the most appropriate course of action.
Q: What are the costs associated with this type of litigation?
If you do in fact decide to bring a class action law suit and are represented by a member of the legal team of Abraham Fruchter & Twersky LLP, you will not have to pay any attorneys’ fees. Rather, Abraham Fruchter & Twersky LLP will be reimbursed exclusively from the court if it recovers money or other benefit on your behalf as a result of the suit. Additionally, Abraham Fruchter & Twersky LLP will advance all costs and expense of the proceedings, and if there is a settlement or other favorable resolution of the action, we will seek compensation for all costs and expenses from the defendant.
ERISA
Q: What is ERISA?
ERISA is an acronym for the Employee Retirement Income Security Act of 1974, which is a federal law that protects the assets of millions of Americans to ensure that the funds placed in retirement plans will be available for individuals when they retire from the workforce. It was designed to protect the rights of participants and beneficiaries of employee benefit plans offered by employers, unions, and similar institutions.
This Act serves to regulate the conduct of private employers who subsidize employee benefit plans and individuals who manage those plans and regulate their assets. ERISA impresses duties on persons controlling or influencing plan investments, sets minimum standards in the design of certain employee benefit plans, and makes enforceable both the benefit promises made by employers (including those made through the purchase of insurance) and the standards of conduct and plan design imposed by the Act itself. With regard to managing the retirement or other benefit plan, these persons involved in the management and regulation of plans and their assets must act in the best interest of the employees covered by the plan and their beneficiaries, not in the interest of themselves or the employer. ERISA Plans include traditional pension plans, 401(k) plans, employee stock ownership plans (“ESOPs”), health plans, and other employee benefits.
Q: What are examples of some fact patterns which may violate ERISA?
Some fact patterns which may violate ERISA include:
- A company engages in self-dealing and invests the assets of the pension and 401 (k) plans of its employees and agents in the company’s own inappropriate and underperforming retail mutual funds.
- A company miscalculates the pension benefits for thousands of employees.
- A company adopts a plan provision that changes the plan’s vesting schedule in violation of a provision of ERISA that prohibits the involuntary application of such changes to employees with more than three years of service under the plan.
Q: I believe that I have a claim dealing with stock I purchased through my employer-sponsored 401(k). Is this a claim that you can handle?
Yes. Abraham Fruchter & Twersky LLP represents employees who purchased overvalued employer stock through employer-sponsored 401(k) retirement plans. In many of these cases, the firm represents employees alleging breach of fiduciary duties in an attempt to hold employers and the plan administrators responsible for misrepresentations, which lead to the artificial inflation of the value of the employer stock purchased through their 401(k) plans. While employees may also have claims under the laws governing securities fraud, ERISA provides employees with significant additional rights and remedies to recover losses in employer stock loss through a 401(k) retirement plan.
For more information on these or other related claims, please contact Abraham Fruchter & Twersky LLP at 212-279-5050 where a knowledgeable member of our legal team will be more than happy to assist you.
|
