Milberg Weiss Announces Class Action Lawsuit Against Washington Mutual, Inc.

Strategic Insights -

A class action lawsuit was filed on behalf of purchasers of Washington Mutual, Inc. securities and sellers of put options between April 15, 2003, and June 28, 2004, alleging that defendants issued false and misleading statements regarding the company's financial health and hedging strategies. The lawsuit seeks remedies under the Securities Exchange Act of 1934. The complaint charges Washington Mutual, Inc. executives with violating Section 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder. The lawsuit alleges that defendants' false statements led to a significant decline in the company's stock price following the release of disappointing earnings on June 29, 2004.

Key Takeaways:

  • The class action lawsuit was filed on July 20, 2004, against Washington Mutual, Inc. executives, including Kerry K. Killinger, Thomas W. Casey, Deanna W. Oppenheimer, William W. Longbrake, Craig J. Chapman, James G. Vanasek, and Michelle McCarthy.
  • The lawsuit alleges that defendants issued false and misleading statements regarding the company's ability to grow and its financial hedging strategies.
  • The complaint charges defendants with violating Section 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder.
  • The lawsuit alleges that defendants' false statements led to a significant decline in the company's stock price, from $41.31 per share on June 29, 2004, to $36.50 per share on the same day.
  • Investors who bought Washington Mutual, Inc. securities and/or sold put options between April 15, 2003, and June 28, 2004, and sustained damages are eligible to request appointment as lead plaintiff by September 20, 2004.

Statistics:

  • The class action lawsuit was filed on July 20, 2004.
  • The lawsuit covers a time period from April 15, 2003, to June 28, 2004.
  • The significant decline in the company's stock price was 12%, from $41.31 per share on June 29, 2004, to $36.50 per share on the same day.

Sources:

  • United States District Court for the Western District of Washington at Seattle.
  • Milberg Weiss Bershad & Schulman LLP's website at www.milbergweiss.com.
  • Washington Mutual, Inc.'s press release announcing the earnings and net income shortfall on June 29, 2004.