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MF Global

Practice Area: Securities Fraud

Case News

On November 18, 2011, Judge Victor Marrero finally approved the settlement in Rubin v. MF Global, Ltd.   On August 15, 2011, the Court granted preliminary approval of the settlement between the Lead Plaintiffs and MF Global, Ltd. and other defendants for $90 million in cash.

The bankruptcy court heard MF Global’s motion on November 16, 2011 and granted the motion to lift the stay on November 17, 2011. (A copy of the order is available here.) The final settlement hearing will be held as scheduled in the district court on November 18th. Please continue to monitor this website on a regular basis to find out if there have been any material developments.

On October 31, 2011, MF Global Holdings, Ltd. filed a voluntary Chapter 11 petition for relief under the United States Bankruptcy Code. As a result of the bankruptcy filing, all pending litigation against MF Global was automatically stayed against it, including the securities class action. On November 11, 2011, MF Global filed a motion in the United States Bankruptcy Court for the Southern District of New York asking the bankruptcy court to lift the automatic stay to allow the United States District Court to go forward with the final settlement hearing of the securities class action on November 18, 2011, as previously scheduled. (A copy of that motion is available here.)

On August 31, 2011, Cohen Milstein announced the issuance of a Notice of Pendency of Class Action and Proposed Settlement and Notice of Scheduling of Settlement Fairness Hearing.  Click here for the Notice of Pendency of Proposed Settlement.  Click here for the Proof of Claim and Release form.  The Proof of Claim and Release form must be postmarked no later than December 27, 2011.

On August 15, 2011, the Court granted preliminarily approval in connection with the proposed settlement agreement.

On January 20, 2011, the lead plaintiffs agreed to a settlement in principle with MF Global, Ltd. and other defendants for $90 million in cash, subject to review and approval by the Court.

On November 5, 2010, Lead Plaintiffs filed their First Amended Consolidated Class Action Complaint.  Shortly thereafter on November 10, the parties entered into mediation.
On September 14, 2010, the United States Court of Appeals for the Second Circuit vacated in part the lower court’s dismissal of the case, and remanded the case for further proceedings.

On September 18, 2009, Lead Plaintiffs filed a notice of appeal.

On January 12, 2009, Defendants filed motions to dismiss the Consolidated Class Action Complaint.

On July 16, 2009, the Court entered a decision and order granting Defendants’ motions to dismiss.

On June 23, 2008, Judge Victor Marrero appointed Cohen Milstein as Co-Lead Counsel and granted the motion to appoint Iowa Public Employees' Retirement System; Policemen's Annuity & Benefit Fund of Chicago; Central States, Southeast, Southwest Areas Pension Fund; and State-Boston Retirement System as Co-Lead Plaintiffs.  On September 12, 2008, Lead Plaintiffs filed the Consolidated Class Action Complaint.

Case Background

Cohen Milstein has filed a class action lawsuit in the United States District Court for the Southern District of New York on behalf of purchasers of MF Global, Ltd. ("MF Global" or the "Company") (NYSE: MF) common stock between March 17, 2008 and June 20, 2008, inclusive (the "Class Period").

The Complaint asserts claims against Defendants MF Global and certain of its officers and directors for violations of federal securities laws, including Sections 10(b) and 20(a) of the Securities Exchange Act of 1934. The Complaint alleges during the Class Period Defendants issued materially false and misleading statements regarding the Company's capital and financial results and concealed the material deterioration in the Company's business and the insufficiency of its capital which would necessitate additional offerings of securities and dilution of the ownership interest of MF Global investors. As a result of Defendants' false statements, MF Global stock traded at artificially inflated prices during the Class Period, reaching a high of $14.98 per share in May 2008.

On June 17, 2008, MF Global issued a press release announcing its intention to sell approximately $300 million in convertible stock and bonds to repay a bridge loan due in December and updating its current fiscal first quarter 2009 earnings estimates. The expected revenues were well below the levels MF Global's management had led the market to expect just weeks earlier. As a result of this news, MF Global's stock dropped to close at $7.83 per share on June 18, 2008, a decline of 43% from June 17, 2008.

On June 19, 2008, The Wall Street Journal published an article regarding the Company's planned $300 million offering and its other recent problems, including a probe by the Commodity Futures Trading Commission. On this news, MF Global's stock dropped to $6.68 per share on June 20, 2008, a decline of 55% from the Class Period high of $14.98 per share in May 2008.

If you have any questions about the action, or with regard to your rights, please contact the following:

Carol V. Gilden
Cohen Milstein Sellers & Toll PLLC
190 South LaSalle Street
Suite 1705
Chicago, IL 60606
Telephone:  (312) 357-0370