Kaplan Fox Files Securities Class Action on Behalf of Purchasers of Wilmington Trust Corporation Common Stock During the Period
December 10 2010 - 8:00PM
Marketwired
Kaplan Fox & Kilsheimer LLP (www.kaplanfox.com) has filed a
class action suit against Wilmington Trust Corporation ("Wilmington
Trust" or the "Company") (NYSE: WL) that alleges violations of the
Securities Exchange Act of 1934 on behalf of purchasers of
Wilmington Trust common stock during the period April 18, 2008
through November 1, 2010, inclusive (the "Class").
The case is pending in the United States District Court for the
District of Delaware (Civil Action No. 10-1086). A copy of the
complaint may be obtained from Kaplan Fox or the Court.
The Complaint alleges that, throughout the Class Period,
Defendants misrepresented the true extent of the deterioration in
its loan portfolio in press releases and its quarterly and annual
filings with the Securities and Exchange Commission ("SEC") and
that unknown to investors, during the Class Period, Wilmington
Trust knowingly or recklessly failed to disclose that (1) its loan
portfolio was impaired to a much larger extent than the Company had
disclosed, (2) the Company had failed to properly record losses for
its impaired assets by adequately provisioning for loan losses each
quarter in light of its known concentrations of loans in the
commercial sector and in the struggling Delaware region, and that
as result of the foregoing, (3) the Company's financial statements
were materially false and misleading and not prepared in accordance
with GAAP, including overstating the value of the Company's assets,
understating its provisions for loan losses and understating the
Company's income tax expense; and (4) Defendants lacked a
reasonable basis for their positive statements about the Company,
its prospects and growth.
The Complaint further alleges that on November 1, 2010,
Wilmington Trust shocked investors when it issued two related press
releases. According to the Complaint, in the first press release,
Wilmington Trust announced dismal results for the third quarter of
2010, reporting a loss of $365.3 million due in part to an
additional $281.5 million loan loss provision and a $100.7 million
income tax expense associated with a valuation allowance against
the Company's deferred tax asset. The Complaint further alleges
that the Company stated that a primary cause for the loss was
continued deterioration in the Company's loan portfolio, reflecting
the extent of the Company's exposure to real estate construction
lending concentrated in Delaware, and that Wilmington Trust further
stated that it had "little assurance" that its loan portfolio would
strengthen significantly in the near term, or that the Company's
capital position would not erode further. According to the
Complaint, in the second press release, Wilmington Trust announced
that it would merge with M&T Bank Corporation ("M&T") and
that the two companies had already signed a definitive
agreement.
It is further alleged that under the terms of the merger
agreement, Wilmington Trust common shareholders will receive
0.051372 shares of M&T common stock in exchange for each share
of Wilmington Trust common stock and that at this conversion ratio,
the transaction values each Wilmington Trust common share at a mere
$3.84 per share representing what the Company claimed to be the
tangible book value as of September 30, 2010, despite Wilmington
Trust's shares closing at $7.11 per share on October 29, 2010, the
last trading day before the announcement.
Finally, the Complaint alleges that upon the release of the
November 1, 2010 news, shares of the Company's common stock fell
$2.90 per share, or more than 40%, to close at $4.21 per share on
unusually heavy trading volume.
If you are a member of the proposed Class, you may move the
court no later than January 18, 2011 to serve as a lead plaintiff
for the Class. You need not seek to become a lead plaintiff in
order to share in any possible recovery.
Plaintiff seeks to recover damages on behalf of the Class and is
represented by Kaplan Fox & Kilsheimer LLP. Our firm, with
offices in New York, San Francisco, Los Angeles, Chicago and New
Jersey, has many years of experience in prosecuting investor class
actions and actions involving financial fraud. For more information
about Kaplan Fox & Kilsheimer LLP, or to review a copy of the
complaint filed in this action, you may visit our website at
www.kaplanfox.com.
If you have any questions about this Notice, the action, your
rights, or your interests, please contact: Pamela A. Mayer KAPLAN
FOX & KILSHEIMER LLP 850 Third Avenue, 14th Floor New York, New
York 10022 (800) 290-1952 (212) 687-1980 Fax: (212) 687-7714 E-mail
address: pmayer@kaplanfox.com Laurence D. King KAPLAN FOX &
KILSHEIMER LLP 350 Sansome Street, Suite 400 San Francisco,
California 94104 (415) 772-4700 Fax: (415) 772-4707 E-mail address:
lking@kaplanfox.com
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