Chimicles & Tikellis LLP is counsel in a securities class action on behalf of a Class of persons and entities who purchased or acquired shares of Wilmington Trust Corporation (“Wilmington Trust”) between January 18, 2008 and November 1, 2010.
This action brings claims for violations of the federal securities laws by Wilmington Trust, CEO and Chairman Donald E. Foley, former CEO and Chairman Ted T. Cecala, CFO David R. Gibson, COO Robert V.A. Harra, Jr., former Chief Credit Officer William North, Controller Kevyn N. Rakowski, Wilmington’s Board of Directors and Audit Committee, outside auditor KPMG LLP, and underwriters J.P. Morgan Securities and Keefe, Bruyette & Woods, Inc.
Plaintiffs allege that Defendants violated the Securities Exchange Act of 1934 by concealing the drastic deterioration of Wilmington Trust’s loan portfolio and improperly accounting for the value of its loans under Generally Accepted Accounting Principles. In particular, Defendants understated Wilmington Trust’s provision for loan losses as its loan portfolio declined in quality, improperly delayed recognition of losses on the portfolio, and inflated its financial results by misstating the fair value of its loan portfolio. Defendants’ misconduct served to artificially inflate the price of Wilmington Trust securities during the Class Period.
Plaintiffs also allege that Defendants violated the Securities Act of 1933 by issuing untrue statements in connection with the Company’s February 23, 2010 public equity offering, including by understating Wilmington Trust’s provision for loan losses.
Upon revelation of the truth about Wilmington Trust’s loan portfolio and loan loss provisions through a series of disclosures in 2010, the price of Wilmington Trust securities dropped sharply, causing the Class to incur substantial losses.
On March 7, 2011, Hon. Leonard P. Stark, U.S. District Judge for the District of Delaware, entered an Order appointing the Institutional Investor Group (consisting of the Merced County Employees’ Retirement Association, the Coral Springs Police Pension Fund, the St. Petersburg Firefighters’ Retirement System, the Pompano Beach General Employees Retirement System, and the Automotive Industries Pension Trust Fund) as Lead Plaintiff and appointing C&T as Liaison Counsel for the Class. The Action was subsequently reassigned to U.S. District Court Judge Sue Robinson.
On March 20, 2014, the Court issued an Order sustaining Lead Plaintiffs’ claims in all material respects. The case proceeded with discovery. Further, on September 3, 2015, the Court certified the Class.