Federman & Sherwood Announces the Filing of a Securities Class Action Lawsuit against Banc of California, Inc.
Oklahoma City, OK (January 25, 2017) – On January 23, 2017, a securities class action lawsuit was filed in the United States District Court for the Central District of California against Banc of California, Inc. (NYSE: BANC). The complaint alleges violations of federal securities laws, Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5, including allegations of issuing a series of material or false misrepresentations to the market which had the effect of artificially inflating the market price during the Class Period, which is October 29, 2015 through January 20, 2017. More specifically, this litigation was filed because Defendants made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations, and prospects, including: (1) that the Company had extensive ties to an alleged “fraudster” named Jason Galanis (“Galanis”); (2) that, given Galanis’ history, the Company’s ties to Galanis created substantial regulatory risk; (3) that revelation of Galanis’ ties to the Company could cause a substantial decline in the market price of the Company’s securities; (4) that the Company allegedly misled investors concerning the Company’s connections with Galanis; and (5) that, as a result of the foregoing, Defendants’ positive statements about BANC’s business, operations, and prospects, were false and misleading and/or lacked a reasonable basis.
On October 18, 2016, an article published on Seeking Alpha alleged that Banc of California, Inc. (“BANC”) had concealed numerous connections between it and Jason Galanis, who has been convicted of criminal securities fraud, including that: (1) CEO Jason Sugarman was the founder, CEO, and indirect owner of a company controlled by Galanis; and (2) separately, Galanis controlled BANC's founding shareholder. The Seeking Alpha article also alleged that BANC had used an off-balance sheet lender to make loans to insiders.
BANC stated in its SEC filing on November 10, 2016, that it is delaying the filing of its Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2016 for the completion of a review into certain purported improper relationships and related party transactions and related matters. BANC further stated the review includes an investigation by independent legal counsel having no prior relationship with BANC or its officers and directors will be investigating as appointed by the Special Committee of Independent Directors, established by the Board of Directors on October 27, 2016.
On January 23, 2017, BANC announced the resignation of its CEO, Steven A. Sugarman, and that the SEC had opened an investigation into whether the BANC had misled investors in its response to the October 2016 Seeking Alpha report disclosing a connection between the BANC and an alleged fraudster named Jason Galanis. On this news the Company’s shares fell $1.50 per share to close at $14.65 per share.
Plaintiff seeks to recover damages on behalf of all Banc of California, Inc. shareholders who purchased common stock during the Class Period and are therefore a member of the Class as described above. You may move the Court no later than Friday, March 24, 2017 to serve as a lead plaintiff for the entire Class. However, in order to do so, you must meet certain legal requirements pursuant to the Private Securities Litigation Reform Act of 1995.
To join this class action, click here to obtain an investor certification. Once complete, please email this form to email@example.com, fax to us at (405) 239-2112 or send by regular mail to Federman & Sherwood, 10205 North Pennsylvania Avenue, Oklahoma City, OK 73120, ATTN: Robin.
Posted on Wed, January 25, 2017
by Nancy Beatty filed under