BOCA RATON, Fla., July 09, 2021 (GLOBE NEWSWIRE) -- Saxena White P.A. has filed a securities fraud class action lawsuit (the “Class Action”) in the United States District Court for the Eastern District of Virginia against James River Group Holdings, Ltd. (“James River” or the “Company”) (NASDAQ: JRVR) and certain of its executive officers (collectively, “Defendants”). The Class Action asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and SEC Rule 10b-5 promulgated thereunder on behalf of all persons or entities who purchased James River common stock between August 1, 2019 and May 5, 2021, inclusive (the “Class Period”), and were damaged thereby (the “Class”). The Class Action is captioned: Employees’ Retirement Fund of the City of Fort Worth dba Fort Worth Employees’ Retirement Fund v. James River Group Holdings, Ltd, et. al., 3:21-cv-00444 (E.D. Va.).
James River is a Bermuda-based holding company that owns and operates a group of specialty insurance and reinsurance companies. In 2014, James River ramped up its Commercial Auto Division by underwriting a new type of insurance policy that covered Rasier LLC (“Rasier”), a subsidiary of the ride-sharing company Uber Technologies, Inc. (together with Rasier, “Uber”).
The Class Action alleges that, during the Class Period, Defendants made materially false and misleading statements and failed to disclose material adverse facts about the Company’s business, operations, and prospects in violation of the Exchange Act and SEC Rule 10b-5. Specifically, Defendants failed to disclose that: (1) James River had not adequately reserved for its Uber policies; (2) James River was using an incorrect methodology for setting reserves that materially understated the Company’s true exposure to Uber claims; (3) as a result, James River was forced to increase its unfavorable reserves in subsequent quarters even after cancelling the Uber policies; and (4) as a result of the foregoing, Defendants’ statements about James River’s business, operations, and prospects were materially false and/or misleading and/or lacked a reasonable basis.
The truth emerged through two disclosures that caused James River’s stock price to fall and investors to suffer substantial losses. First, on October 8, 2019, James River announced that it had delivered a notice of early cancellation, effective December 31, 2019, for all insurance policies issued to Uber, though the Company remained contracted to provide coverage for future claims related to the period the Company’s Uber policies were in effect (known as “runoff”). The Company also advised of an adverse development between $55 and $60 million—primarily related to Uber policies for the 2016 and 2017 underwriting years. In response to this news, James River’s stock price fell $11.06 per share, or more than 22 percent. Significantly, despite the runoff coverage commitment, Defendants assured investors throughout the Class Period that James River’s issues with Uber were behind it and the Company had adequately reserved. These misrepresentations and omissions caused the Company’s stock to continue trading at artificially inflated prices.
Then, on May 5, 2021, eighteen months after the Company announced its cancellation of the Uber contract, and after repeated assurances to investors that the legacy contract posed no challenges, James River surprised the market by disclosing an additional $170 million of unfavorable reserves related to the Uber policies. In response to this news, James River’s stock price dropped $12.27 per share, or more than 26 percent.
If you purchased James River common stock during the Class Period and were damaged thereby, you are a member of the “Class” and may be able to seek appointment as lead plaintiff. If you wish to apply to be lead plaintiff, a motion on your behalf must be filed with the U.S. District Court for the Eastern District of Virginia no later than September 7, 2021. The lead plaintiff is a court-appointed representative for absent members of the Class. You do not need to seek appointment as lead plaintiff to share in any Class recovery in the Class Action. If you are a Class member and there is a recovery for the Class, you can share in that recovery as an absent Class member.
You may contact Lester Hooker (lhooker@saxenawhite.com), an attorney and Director at Saxena White P.A., to discuss your rights regarding the appointment of lead plaintiff or your interest in the Class Action. You also may retain counsel of your choice to represent you in the Class Action.
You may obtain a copy of the Complaint and inquire about actively joining the Class Action at www.saxenawhite.com.
Saxena White P.A., with offices in Florida, New York, California, and Delaware, is a leading national law firm focused on prosecuting securities class actions and other complex litigation on behalf of injured investors. Currently serving as lead counsel in numerous securities fraud class actions nationwide, Saxena White has recovered billions of dollars on behalf of injured investors.
CONTACT INFORMATION
Lester R. Hooker, Esq.
lhooker@saxenawhite.com
Saxena White P.A.
7777 Glades Road, Suite 300
Boca Raton, FL 33434
Tel: (561) 206-6708
Fax: (561) 394-3382
www.saxenawhite.com