NEW YORK, April 24, 2009 (GLOBE NEWSWIRE) -- The Brualdi Law Firm, P.C. announces that a lawsuit has been commenced in the United States District Court for the Southern District of New York on behalf of investors who purchased shares of MRU Holdings, Inc. ("MRU" or the "Company") (OTC:UNCLQ; formerly NASDAQ:UNCL) during the period between July 9, 2007 and September 19, 2008, inclusive (the "Class Period") for violations of the federal securities laws.
No class has yet been certified in the above action. Until a class is certified, you are not represented by counsel unless you retain one. If you purchased MRU securities during the Class Period, and wish to move the court for appointment of lead plaintiff, you must do so by June 19, 2009. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. The lead plaintiff will be selected from among applicants claiming the largest loss from investment in the Company during the Class Period. You do not need to seek appointment as a lead plaintiff in order to share in any recovery.
To be a member of the class you need not take any action at this time, and you may retain counsel of your choice. If you wish to discuss this action or have any questions concerning this Notice or your rights or interests with respect to these matters, please contact Sue Lee at The Brualdi Law Firm, P.C. 29 Broadway, Suite 2400, New York, New York 10006, by telephone toll free at (877) 495-1187 or (212) 952-0602, by email to slee@brualdilawfirm.com or visit our website at http://www.brualdilawfirm.com.
The complaint charges MRU and certain of its officers and directors with violations of the Securities Exchange Act of 1934. The complaint alleges, among other things, that the defendants' public statements failed to disclose, among other things, that: (1) the market for Auction Rate Securities ("ARS"), which the Company issued in its first student loan securitization, was illiquid and existed at the whim of the broker-dealers; (2) the illusion of liquidity created by the broker-dealers allowed the Company to securitize its student loans on favorable terms; (3) that once the true nature of the ARS market became known, the terms of future securitizations by the Company would not be favorable to the Company; and (4) that without the favorable terms available in the ARS market as a result of manipulation by the broker-dealers, the Company would not have sufficient capital to originate loans, making the Company's business model untenable.
On July 7, 2008, the Company revealed the unfavorable terms of its second securitization, causing the price of its securities to drop to $2.27 per share -- a one day decline of $0.23 per share, or 9.2%. Then, on August 18, 2008, Moody's Investors Service placed the ARSs issued by MRU on review for downgrade, driving the price of MRU shares even further, to $1.05 per share. After the market closed on September 5, 2008, the Company ceased originating student loans, which caused MRU's stock price to fall even further, closing on September 6, 2008 at $0.71. Finally, on February 9, 2009, MRU announced that it had filed a voluntary petition for bankruptcy. The Company's shares have been delisted from the NASDAQ stock exchange, and currently trade at less than $.01 per share.