Monday, February 4, 2008
Labaton Sucharow Files Class Action Lawsuit Against Centerline Holding Company
NEW YORK (February 4, 2008) – Labaton Sucharow filed a class action lawsuit on January 18, 2008 in the United States District Court for the Southern District of New York, on behalf of purchasers of Centerline Holding Company ("Centerline" or the "Company") (NYSE: CHC) common stock between March 12, 2007 and December 28, 2007, inclusive (the "Class Period"). The complaint alleges that during the Class Period, Defendants violated the Securities Exchange Act of 1934 by issuing various materially false and misleading statements about Centerline's business model that had the effect of artificially inflating the market price of the Company's common stock.
The complaint alleges that Defendants failed to disclose that they were in the process of restructuring a sale of Centerline’s mortgage revenue bond portfolio to a third party. On December 28, 2007, the Company stunned the investment public by announcing that Centerline had sold its “$2.8 billion tax-exempt affordable housing bond portfolio” to a third party, and in the process, altered the Company’s business model to a sole asset management company. In addition, the Defendants also revealed that Centerline had agreed to deal with The Related Companies, L.P. (“TRCLP”), a company owned and controlled by certain of the Defendants. According to the deal terms, TRCLP promised to invest $131 million in Centerline in exchange for newly-issued convertible preferred stock that will pay Company insiders an 11% dividend. Lastly, Defendants said that Centerline would be cutting its annual dividend from $1.68 per share to only $0.60 per share. As a result of the news, Centerline stock fell from $10.27 per share on December 27, 2007 to $7.70 per share on December 28, 2007, representing a 25% one-day decline, on unusually high trading volume of more than 4 million shares.
Labaton Sucharow LLP, with offices in New York, New York and Wilmington, Delaware, is one of the country’s premier law firms representing institutional investors in class action and complex securities litigation, as well as consumers and businesses in class actions seeking to recover damages for anticompetitive practices. The Firm has been a champion of investor and consumer rights for over 45 years, seeking recovery of current losses and necessary governance reforms to protect investors and consumers. Labaton Sucharow has been recognized for its excellence by the courts and its peers. More information about Labaton Sucharow is available at www.labaton.com.
If you bought Centerline common stock between March 12, 2007 and December 28, 2007, inclusive, you may qualify to serve as Lead Plaintiff. Lead Plaintiff papers must be filed with the court no later than March 18, 2008.