Altisource Portfolio Solutions SA (NASDAQ: ASPS) Investor Securities Class Action Lawsuit 09/08/2014

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Company Name(s): 
Altisource Portfolio Solutions
Case Name: 
Altisource Portfolio Solutions Shareholder Class Action Lawsuit 09/08/2014
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Approved
Affected Securities
NASDAQ: ASPS
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
09/08/2014
Class Period Begin: 
04/25/2013
Class Period End: 
12/21/2014
Court of Filing: 
U.S. District Court for the Southern District of Florida
Deadline To File for Lead: 
11/07/2014
Date Settled: 
02/10/2017
Settlement Amount: 
$32,000,000
Deadline to Participate in Settlement: 
07/11/2017
Summary: 

May 31, 2017 - The court approved the settlement and entered the orders approving the plan of allocation, the motion for attorneys’ fees and expenses, and dismissing the action with prejudice.

May 30, 2017 - The court held a final settlement hearing.

February 10, 2017 - The court preliminarily approved the settlement.

February 8, 2017 - Parties filed a stipulation of settlement.

December 22, 2015 - The court granted in part and denied in part defendants motions to dismiss.

October 22, 2015 - Defendants filed motions to dismiss.

October 15, 2015 - The lead plaintiffs filed an amended complaint on behalf of investors who purchased Altisource Portfolio Solutions SA (NASDAQ: ASPS) common shares between April 25, 2013 and December 21, 2014. The lead plaintiffs allege that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between April 25, 2013 and December 21, 2014.

September 4, 2015 - The court granted defendants' motion to dismiss.

March 23, 2015 - Defendants filed a motion to dismiss.

February 2, 2015 - The lead plaintiffs filed a corrected amended complaint.

January 30, 2015 - The lead plaintiffs filed an amended complaint.

December 5, 2014 - Lead plaintiff and lead counsel were appointed.

November 7, 2014 - Lead plaintiff motions were filed.

September 8, 2014 - An investor in shares of Altisource Portfolio Solutions SA (NASDAQ: ASPS), filed a lawsuit in the U.S. District Court for the Southern District of Florida against Altisource Portfolio Solutions SA over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between July 25, 2013 and August 4, 2014.

According to the complaint the plaintiff alleges on behalf of purchasers of Altisource Portfolio Solutions SA (NASDAQ: ASPS) common shares between July 25, 2013 and August 4, 2014, that the defendants violated Federal Securities Laws.

More specifically, the plaintiff claims that Defendants made allegedly false and/or misleading statements and/or failed to disclose material information regarding Altisource Portfolio Solutions SA's allegedly improper business and operational practices including, among other things, the fact that Ocwen Financial Corporation ("Ocwen"), a financial services holding company of which Defendant William C. Erbey is Chairman of the Board, was funneling as much as $65 million in fees annually from already-distressed homeowners to Altisource Portfolio Solutions SA for minimal work; and that Defendant William C. Erbey, who owns approximately 27% of Altisource Portfolio Solutions SA’s shares outstanding, was directly involved in approving Altisource Portfolio Solutions SA's conflicted transactions with Ocwen.

The plaintiff alleges that Defendants issued materially false and misleading statements and omitted material information from Altisource Portfolio Solutions SA’s public disclosures, which failed to disclose, among other things,

- that Altisource Portfolio Solutions SA was charging exorbitant fees to Ocwen to enable Defendants to funnel as much as $65 million in questionable fees, that despite public representations to the contrary, Defendant Erbey was personally involved in approving conflicted transactions with Altisource Portfolio Solutions SA and other related entities which he controlled,
- that Altisource Portfolio Solutions SA failed to comply with applicable laws and regulations, including lending regulations designed to protect homeowners,
- that Altisource Portfolio Solutions SA’s financial statements between July 25, 2013 and August 4, 2014 were artificially inflated and did not provide a fair presentation of the Company's finances and operations,
- that Altisource Portfolio Solutions SA lacked adequate internal and financial controls,
and
- that as a result of the above, Altisource Portfolio Solutions SA’s financial statements were materially false and misleading at all relevant times.

Altisource Portfolio Solutions SA reported that its annual Total Revenue rose from $301.38 million in 2010 to $768.36 million in 2013 and that its respective Net Income increased from $49.27 million to $129.97 million. Shares of Altisource Portfolio Solutions SA (NASDAQ: ASPS) grew from slightly over $22 per share in early 2010 to as high as $170.19 per share in December 2013. Since then NASDAQ: ASPS shares have lost significant value and declined to as low as $95.36 per share in May 2014.

Then on August 4, 2014, the New York's Department of Financial Services disclosed that it was investigating whether Ocwen Financial Corp entered into improper transactions with affiliated entities. According to the New York's Department of Financial Services, Ocwen Financial Corp entered into an arrangement with Altisource Portfolio Solutions SA, whose executives have substantial ties to Ocwen Financial Corp, which raises concerns about whether such transactions were priced fairly and conducted at arm's-length.

Shares of Altisource Portfolio Solutions SA (NASDAQ: ASPS) declined from over $121 per share in late July 2014 to as low as $83.37 per share on August 8, 2014.