The lawsuit alleges that American Home Mortgage and certain of its officers and directors violated Federal Securities laws. According to the complaint, throughout the Class Period defendants failed to disclose, among other things, that the Company was operating without adequate reserves for delinquent loan repurchases or an adequate strategic plan in relation to the volatility of certain of American Home Mortgage's loan products. As a result of defendants' failure to fully disclose that the Company was operating without adequate reserves in relation to the Company's prior sales of certain of American Home Mortgage's loan products or an adequate strategic plan for the repurchase of delinquent previously sold loans, defendants materially misrepresented to investors the true facts concerning American Home Mortgage's financial performance and prospects.
Then, on June 28, 2007, American Home Mortgage issued a press release announcing that it will take "substantial charges for credit-related expenses in the second quarter." The Company reported that the increase in losses was related to its practice of extending a three month timely payment warranty that the Company granted to loan buyers who purchased stated income loans. In response to this announcement, the price of American Home Mortgage stock declined from $20.91 per share to $18.38 per share on extremely heavy trading volume. Then, on July 27, 2007, after the close of the market, American Home Mortgage issued a press release announcing that its Board of Directors had determined to delay paying its dividend. In response to this announcement, on July 30, 2007, the NYSE halted trading in American Home Mortgage stock before the market opened.
If you are a member of the class, you may, no later than October 1, 2007, request that the Court appoint you as lead plaintiff of the class. Although your ability to share in any recovery is not affected by the decision whether or not to seek appointment as a lead plaintiff, lead plaintiffs can participate in important decisions which could affect the recovery for class members.
If you wish to discuss this action, or have any questions concerning this notice or your rights, please contact us, toll free, at (888) 529 4787 or by email at info.newcases@kmslaw.com.
Kirby McInerney & Squire, LLP has specialized in complex litigation, including securities class actions, for several decades. The firm has repeatedly demonstrated its expertise in this field, and has been recognized by various courts which have appointed the firm to major positions in consolidated and multi-district litigation. The firm's efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling hundreds of millions of dollars, and the firm's achievements and quality of service have been chronicled in numerous published decisions. More information about the firm, class actions in general, or about the role of the lead plaintiffs in a securities class action can be obtained through Kirby McInerney & Squire, LLP's website at http://www.kmslaw.com
