Cases / Recently Settled Cases

AmTrust Financial Services, Inc. - Preferred Stock Litigation


$13 Million Settlement Reached in AmTrust Preferred Stock Litigation

Wolf Popper LLP, the Court-appointed Lead Counsel and Class Counsel in a federal securities fraud action against the insurance holding company AmTrust Financial Services, Inc., has reached a settlement, which, if approved, would resolve the litigation in exchange for a cash payment of $13,000,000 for the benefit of the certified class.  The lawsuit, on behalf of purchasers of AmTrust preferred stock between January 22, 2018 and January 18, 2019, alleges that AmTrust and three of its directors falsely assured investors that, unlike AmTrust’s common shares, which would be purchased and delisted as part of a take-private merger, AmTrust preferred stock would continue to be listed on the New York Stock Exchange.

The settlement follows i) an August 14, 2020, Opinion and Order, where United States District Court Judge Katherine Polk Failla denied the defendants’ motion to dismiss, finding that the complaint had sufficiently articulated a “classic bait and switch,” and ii) a February 3, 2022 Opinion and Order granting the plaintiff’s class certification motion, where Judge Failla, among other things, appointed Wolf Popper as Class Counsel, finding that it "is an experienced law firm that has litigated similar securities class actions in the past" and had “worked diligently" with its client "to initiate and prosecute this action."

The Court has set a final hearing to determine whether to approve the settlement, which will take place on November 16, 2022 at 3p.m. at the Thurgood Marshall U.S. Courthouse, 40 Foley Square, New York, NY 10007.  Class members will be notified of the settlement pursuant to the schedule set forth in the Court’s July 21, 2022 Order preliminarily approving the settlement.  For additional information, please contact Carl L. Stine or Adam J. Blander or visit the settlement website, www.AmtrustPreferredStockLitigation.com.  Copies of the Notice, Claim Form, and various court documents are available at the settlement website; and you can also submit your claim form online at the settlement website.

The case is Martínek v. AmTrust Financial Services, Inc., Case Number 19-cv-8030-KPF, in the U.S. District Court for the Southern District of New York.

Class Certification Granted in AmTrust Preferred Stock Securities Litigation

In an Opinion and Order dated February 3, 2022, United States District Court Judge Katherine Polk Failla granted Lead Plaintiff Jan Martínek's motion for class certification in its entirety, certifying a class of "all persons who purchased Series A preferred stock of AmTrust Financial Services, Inc. ('AmTrust'), or AmTrust’s Depositary Shares Representing 1/40th of a share of either AmTrust’s Series B, C, D, E or F preferred stock … on the open market on a U.S. stock exchange from January 22, 2018, to January 18, 2019, inclusive."  Excluded from the class are defendants and their affiliates. 

The Court also appointed Mr. Martínek as the Class Representative, and Wolf Popper LLP, counsel to Mr. Martínek, as Class Counsel, finding that Wolf Popper "is an experienced law firm that has litigated similar securities class actions in the past" and "has worked diligently" with its client "to initiate and prosecute this action."

In the 51-page Opinion and Order, the Court found that Lead Plaintiff had established that all relevant requirements of Rule 23 of the Federal Rules of Civil Procedure had been met, and accordingly, class treatment of the action was appropriate.  The Court also rejected defendants' attempts to narrow Lead Plaintiff's proposed class definition. 

Click here for a recent news article reporting on this decision.

The case is Martínek v. AmTrust Financial Services, Inc., Case Number 19-cv-8030-KPF, in the U.S. District Court for the Southern District of New York.

For further information about this case, contact Carl L. Stine, cstine@wolfpopper.com.

Wolf Popper LLP Prevails Against Motion to Dismiss in AmTrust Preferred Stock Securities Lawsuit

In an Opinion and Order dated August 14, 2020, United States District Court Judge Katherine Polk Failla denied the defendants’ motion to dismiss a securities fraud action prosecuted by Wolf Popper LLP on behalf of preferred stockholders of AmTrust Financial Services, Inc., a large insurance company.

The complaint filed by Wolf Popper described how AmTrust and three of its directors falsely assured the investing public that, unlike AmTrust’s common shares, which would be purchased and delisted as part of a merger in which these three directors would be taking the company private, AmTrust preferred stock would continue to be listed on the New York Stock Exchange.

In rejecting the defendants’ arguments, Judge Failla concluded that “[t]he fact of the matter is that, prior to the Merger, Defendants repeatedly assured investors that the preferred stock would remain listed, and then, less than two months after the transaction closed, decided to delist the preferred stock.”  The Court found that the “professed reasons for delisting the stock…were known to the Individual Defendants before the Merger,” a fact “only strengthen[ing] Plaintiff’s argument this was a classic bait and switch.”

Read more about Judge Failla’s decision here.

The case is Martinek v. AmTrust Financial Services, Inc., Case Number 19-cv-8030-KPF, in the U.S. District Court for the Southern District of New York.

Wolf Popper is Lead Counsel.

For further information about this case, contact Carl L. Stine, cstine@wolfpopper.com, Patricia I. Avery, pavery@wolfpopper.com, or Adam Blander, ablander@wolfpopper.com.

Wolf Popper LLP Files a Securities Class Action Lawsuit Against AmTrust Financial Services, Inc.

NEW YORK, August 30, 2019

Wolf Popper LLP has filed a securities class action lawsuit in the U.S. District Court for the Southern District of New York against AmTrust Financial Services, Inc. (“AmTrust”), Barry D. Zyskind, George Karfunkel, and Leah Karfunkel (together, “Defendants”).  The case, No. 1:19-cv-08030-KPF, asserts claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and SEC Rule 10b-5 promulgated thereunder on behalf of investors who purchased any of the six series of AmTrust’s preferred shares during the period January 22, 2018 through January 18, 2019, and were damaged thereby.

Beginning on January 22, 2018, Defendants made repeated statements that, unlike AmTrust’s common shares, which would be purchased by the company’s controlling shareholder and delisted as part of a merger, the six series of publicly traded AmTrust preferred stock would continue to be listed on the New York Stock Exchange and would remain listed and outstanding.  On January 18, 2019, less than two months after the close of the merger, AmTrust announced the delisting of all six series of its preferred stock.

The very next trading day following the announcement, the prices of all six series of the preferred stock dropped by almost 40%, losing hundreds of millions of dollars in value.

If you are a member of the proposed Class, and wish to serve as Lead Plaintiff, you must file a motion with the Court no later than October 30, 2019. A lead plaintiff is a representative party acting on behalf of other Class members in directing the litigation. Any member of the proposed Class may move the Court to serve as Lead Plaintiff through counsel of their choice. Members may also choose to do nothing and remain part of the proposed Class.

Wolf Popper has successfully recovered billions of dollars for defrauded investors.  Ten Wolf Popper attorneys were named Super Lawyers or Rising Stars in the 2018 Super Lawyers New York City Metro Edition, including Wolf Popper partner Carl Stine, who was included in the Super Lawyers Top 100 List for the New York City Metro area.

If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Carl Stine at (212) 759-4600 or cstine@wolfpopper.com.

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