Corporate restructuring causes class action claim headaches

FRT Admin
Site administrator
October 7, 2011

Staying on top of securities class action claim settlements can be frustrating and labor intensive. That task becomes even more confounding in today’s environment of corporate restructuring and mergers & acquisitions. When two companies merge, or one acquires another, there is often a reassignment of the companies’ CUSIPs and ticker symbols. When this happens, it can be extremely difficult to identify eligibility and keep track of securities class action filings.

The challenge with mergers and name changes is being able to recognize all relevant transactions as they relate to securities litigation. When organizations trigger a change in their ticker symbols due to a merger, acquisition, or name change, it is likely that a CUSIP tied to one security offering could be referenced by more than one ticker symbol. RestructuringLikewise, one ticker symbol might reference multiple CUSIPs if ownership of that particular ticker had changed over a period of time. To make matters worse, the same ticker could even reference different securities on different exchanges within the US at the same time.  Without a comprehensive map detailing how a security has been identified over time, it would be easy to miss transactions relevant to a certain securities class action settlement claim, which would result in settlement funds being forfeited.

For example, when Bank of America acquired Countrywide in 2008 (an event that recently resulted in an $8.5 billion class action settlement), there were over 12,000 different CUSIPs related to Countrywide Mortgage Securitization Trusts. All of these CUSIPs are relevant to the class action settlement and must be tracked in order to ensure full compensation for investors in those securities. Making matters even more complex, there are several other recent class actions involving Bank of America and Countrywide. In situations like these, piecing together all of the security identifiers and how they are relevant to each specific litigation can become a full-time job.

Fortunately, Financial Recovery Technologies (FRT) is dedicated to delivering the most comprehensive range of securities class action filing services available.  FRT proactively scours industry data sources in order to identify all cases and relevant securities identifiers to ensure that every possible filing can be made.  Working from client trading data, Financial Recovery Technologies is able to identify all eligible security positions to ensure that your firm capitalizes on all possible settlement funds.

Contact FRT today so we can take the confusion out of securities class actions and collect the valuable recovery dollars that you are entitled to receive.

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Founded in 2008, Financial Recovery Technologies (FRT) is a leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to www.frtservices.com.

 

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.