MINNEAPOLIS, March 12, 2007 (PRIME NEWSWIRE) -- Lockridge Grindal Nauen P.L.L.P. filed a class action against New Century Financial Corp. (NYSE:NEW) ("New Century" or the "Company") in the U.S. District Court for the Central District of California on behalf of purchasers of New Century common stock during the period May 4, 2006 through Friday, March 2, 2007. This is an extension of the class period alleged in previously filed suits.
The Complaint names New Century and certain of its officers and directors and alleges that the defendants violated the federal securities laws by making false and misleading statements concerning the Company's operations and financial results for the first three quarters of 2006.
On February 7, 2007, the Company announced that it was going to restate its financial results for the first three quarters of 2006 because it had failed to account for all re-purchased loans and had failed to properly reduce the value of the loans repurchased. As a result, New Century shares dropped to a 52-week low, plunging $10.92, to close at $9.42 per share, a decline of over 36% on extraordinary volume. Before the announcement, Company insiders sold more than $26 million worth of their personal holdings in New Century stock.
On Friday, March 2, 2007, New Century disclosed that the U.S. Attorney's Office for the Central District of California had notified the Company that it is conducting a criminal inquiry in connection with trading in New Century's stock. The Company also disclosed that the U.S. Attorney's Office is investigating accounting issues regarding New Century's allowance for repurchase losses. On Monday, March 5, 2007, the next trading day, New Century's stock price collapsed nearly 69% -- closing at $4.56 on 17 times the average three month volume.
If you purchased New Century publicly traded securities during the extended Class Period (May 4, 2006 - March 2, 2007), you may, no later than April 10, 2007, move to be appointed as a Lead Plaintiff. You do not need to become a lead plaintiff in order to share in any possible recovery.
Plaintiff seeks to recover damages on behalf of the Class and is represented by Lockridge Grindal Nauen P.L.L.P. If you have questions about the lawsuit or would like to discuss it with an attorney, please call or e-mail:
Karen H. Riebel, Esq. (khriebel@locklaw.com) Lockridge Grindal Nauen P.L.L.P. 100 Washington Avenue South, Suite 2200 Minneapolis, MN 55401 (612) 339-6900
More information on this and other class actions can be found on the Class Action Newsline at www.primenewswire.com/ca/