ENGLEWOOD CLIFFS, N.J., Feb. 25, 2009 (GLOBE NEWSWIRE) -- Gardy & Notis, LLP has filed a class action lawsuit in the United States District Court for the Middle District of Alabama on behalf of all purchasers of The Colonial BancGroup, Inc. ("Colonial") (NYSE:CNB) securities between December 2, 2008 and January 27, 2009, inclusive (the "Class Period").
Colonial and certain of its officers and directors allegedly violated federal securities laws by issuing materially false and misleading statements regarding Colonial's participation in the United States Treasury Department's Troubled Asset Relief Program ("TARP"). Specifically, the Complaint alleges that on December 2, 2008, Colonial announced that the United States Treasury had approved an application for a $553 million preferred equity investment through TARP. In response, shares of Colonial common stock rallied 50%.
On January 27, 2009, however, Colonial announced for the first time that the TARP funding was contingent upon Colonial raising $300 million in capital on its own. Upon this revelation, Colonial's stock price collapsed 46% on January 28, 2009.
Plaintiffs seek to recover damages on behalf of themselves and all other individual and institutional investors who purchased Colonial securities between December 2, 2008 through January 27, 2009, excluding defendants and their affiliates. Plaintiffs are represented by Gardy & Notis, LLP, a law firm with extensive experience in prosecuting class actions and actions involving corporate fraud.
If you purchased Colonial securities between December 2, 2008 and January 27, 2009, you may, not later than April 10, 2009, request that the Court appoint you as lead plaintiff for the class. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation, and you must meet certain legal requirements to serve as a lead plaintiff.
For more information regarding the lawsuit, or to obtain a copy of the complaint, please contact plaintiffs' counsel, Charles A. Germershausen or Kelly A. Noto at Gardy & Notis, LLP: