NEW YORK (June 16, 2017) – Labaton Sucharow LLP announced that it reached a $31 million settlement, subject to court approval, with New York financial services firm, RCS Capital Corporation (RCAP). Serving as court-appointed co-lead counsel on behalf of the class, the Labaton Sucharow team was led by partners Joel H. Bernstein and Ira A. Schochet, with assistance from attorney Eric D. Gottlieb.
The class representatives, City of Providence and Oklahoma Police Pension Fund and Retirement System, allege that from February 12, 2014 through December 18, 2014 (the class period), the defendants falsely and misleadingly touted the strength of RCAP’s business prospects, including its ability to leverage its relationship with related entities also controlled by Nicholas Schorsch, RCAP's former Executive Chairman, while failing to fully disclose accounting fraud at one of those entities, American Realty Capital Properties, Inc. (ARCP), that was allegedly perpetrated and concealed by senior management of ARCP and RCAP, including Schorsch, ARCP's. As a result, when such misconduct was revealed, it is alleged that it tainted the businesses of all Schorsch-related entities, including RACA, RCAP’s revenues declined significantly, and RCAP’s stock price plummeted, causing class members to suffer damages.
The case is Weston v. RCS Capital Corporation, No. 14-cv-10136 (S.D.N.Y.).