LOS ANGELES--(BUSINESS WIRE)--
Glancy Binkow & Goldberg LLP, announces that a class action lawsuit has been filed, with an expanded Class Period, on behalf of a class (the “Class”) comprising all purchasers of the securities of Tower Group International, Ltd. and its predecessor company, Tower Group Inc. (collectively, “Tower Group” or the “Company”) (TWGP) between May 10, 2011 and September 17, 2013, inclusive (the “Class Period”). Members of the Class have until October 21, 2013 to file a motion to be appointed as lead plaintiff in the shareholder lawsuit filed in the United States District Court for the Southern District of New York.
Tower Group is a Bermuda-based company that underwrites insurance and reinsurance products including commercial, personal and specialty insurance in Bermuda, the United States and London markets. On August 7, 2013, the Company announced that it is postponing the release of its financial results for the second quarter of 2013, stating that additional time was needed to review matters relating to the estimate of its loss reserves and its allocation of goodwill and certain tax accounts. Following this news, Tower Group shares declined 24%, or $5.20 per share, to a closing price of $16.41 per share on August 8, 2013.
On September 17, 2013, Tower Group announced plans to release its second quarter 2013 financial results during the week of October 7, 2013, and "reaffirmed that it is not providing and does not expect to provide any information with respect to its results for the second quarter, including the amount of any adjustments for its estimates of loss reserves and amounts of goodwill, until it releases its earnings for the second quarter.” The next day, September 18, 2013, FBR Co. downgraded Tower Group from “outperform” to “market perform,” concluding that the Company’s delay releasing its 2013 second quarter financial results and failure to affirm its previous EPS guidance indicated a “weaker capital position.” Following this news, Tower shares declined nearly 28%, to close that day at $9.99 per share.
Then, on October 7, 2013, Tower Group announced it will add $365 million to its loss reserves to cover additional losses in its commercial insurance lines, and also take a $215 goodwill impairment charge associated with its commercial and specialty and reinsurance segments. As a result of this news, Tower Group shares plummeted 40%, to a closing price of $4.39 per share, on October 8, 2013, on volume of more than 22 million shares traded.
The Complaint alleges that during the Class Period defendants issued false and misleading statements or failed to disclose that:
- The Company failed to properly estimate its loss reserve provisions as required by Generally Accepted Accounting Principles.
- The Company failed to properly allocate its goodwill and certain deferred tax assets.
- The Company failed to maintain adequate internal controls over financial reporting.
If you are a member of the Class described above, you may move the Court no later than October 21, 2013 to serve as lead plaintiff; however, you must meet certain legal requirements. To be a member of the Class you need not take any action at this time; you may retain counsel of your choice or take no action and remain an absent member of the Class.
To learn more about this action, if you have any questions concerning this Notice or your rights or interests with respect to these matters, or if you purchased Tower Group securities prior to the Class Period, please contact Michael Goldberg, Esquire, of Glancy Binkow & Goldberg LLP, 1925 Century Park East, Suite 2100, Los Angeles, California 90067, Toll-Free at (888) 773-9224, or contact Gregory Linkh, Esquire, of Glancy Binkow & Goldberg LLP at 122 E. 42nd Street, Suite 2920, New York, New York 10168, at (212) 682-5340, by e-mail to email@example.com, or visit our website at http://www.glancylaw.com.
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