Ocwen Financial Corp (NYSE: OCN) Investor Securities Class Action Lawsuit 08/12/2014

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Company Name(s): 
Ocwen Financial
Case Name: 
Ocwen Financial Shareholder Class Action Lawsuit 08/12/2014
Case Status: 
Lawsuit Filed
Case Status: 
Settlement Proposed
Affected Securities
NYSE: OCN
Lawsuit Overview
Type of Lawsuit: 
Shareholder Class Action
Date Filed: 
08/12/2014
Class Period Begin: 
05/02/2013
Class Period End: 
12/19/2014
Court of Filing: 
U.S. District Court for the Southern District of Florida
Deadline To File for Lead: 
10/14/2014
Date Settled: 
08/17/2017
Settlement Amount: 
$56,000,000
Deadline to Participate in Settlement: 
12/08/2017
Summary: 

The settlement amount of $56,000,000 consists of:
- $49,000,000 in cash
- the number of shares of Ocwen common stock that equates to $7,000,000 in value

August 17, 2017 - The court preliminarily approved the settlement.

August 16, 2017 - Parties filed a stipulation of settlement.

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

October 27, 2015 - Defendants filed a motion to dismiss.

October 13, 2015 - The lead plaintiff filed another amended consolidated complaint on behalf of investors who purchased Ocwen Financial Corp (NYSE: OCN) common shares between May 2, 2013 and December 19, 2014. The lead plaintiff alleges that the defendants violated the Securities Exchange Act of 1934 by issuing false and misleading statements between May 2, 2013 and December 19, 2014.

September 25, 2015 - The lead plaintiff filed another amended consolidated complaint.

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

July 31, 2015 - More cases were consolidated.

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

February 6, 2015 - The lead plaintiff filed another amended consolidated complaint.

January 13, 2015 - It was revealed that California regulators are seeking to suspend the mortgage license of Ocwen Financial Corporation (NYSE: OCN).

December 8, 2014 - The lead plaintiff filed an amended consolidated complaint.

November 7, 2014 - The lead plaintiff and lead counsel were appointed.

November 5, 2014 - All cases were consolidated.

October 14, 2014 - Lead plaintiff motions were filed.

August 12, 2014 - An investor in shares of Ocwen Financial Corp (NYSE: OCN) filed a lawsuit in the U.S. District Court for the Southern District of Florida against Ocwen Financial Corp over alleged violations of Federal Securities Laws in connection with certain allegedly false and misleading statements made between May 2, 2013 and August 11, 2014.

According to the complaint the plaintiff alleges on behalf of purchasers of Ocwen Financial Corp (NYSE: OCN) common shares between May 2, 2013 and August 11, 2014, that the defendants violated Federal Securities Laws.

More specifically, the plaintiff claims that Defendants issued allegedly materially false and misleading statements and allegedly omitted material information from Ocwen Financial Corp 's public disclosures, which allegedly failed to disclose, among other things, that Altisource Portfolio Solutions, S.A. was charging exorbitant fees to Ocwen Financial Corp 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, S.A. and other related entities which he controlled, that the Company failed to comply with applicable laws and regulations, including lending regulations designed to protect homeowners, that the Company's financial statements between May 2, 2013 and August 11, 2014 were artificially inflated and did not provide a fair presentation of the Company's finances and operations, that the Company lacked adequate internal and financial controls, and that as a result of the above, the Company's financial statements were materially false and misleading at all relevant times.

Shares of Ocwen Financial Corp (NYSE: OCN) grew from $8.76 per share in October 2010 to as high as $59.97 per share in October 2013.

On February 27, 2014, Ocwen Financial Corp announced its operating results for the fourth quarter and full year 2013. Ocwen Financial Corp reported that its annual Total Revenue rose from $845.20 million in 2012 to over $2.03 billion in 2013 and that its Net Income increased from $180.82 million in 2012 to $294.15 million in 2013. Shares of Ocwen Financial Corp (NYSE: OCN) declined from almost $60 per share in October 2013 to as low as $31.85 per share in May 2014.

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 S.A., 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 Ocwen Financial Corp (NYSE: OCN) declined to as low as $25.37 per share on August 7, 2014.

Then on August 12, 2014, Ocwen Financial Corp announced in a filing with the SEC that on August 12, 2014, the Board of Directors and the Audit Committee of the Board of Directors of Ocwen Financial Corp after consultation with Deloitte & Touche LLP, the Company’s independent registered public accounting firm, determined that Ocwen Financial Corp’s financial statements for the fiscal year ended December 31, 2013 and the quarter ended March 31, 2014 can no longer be relied upon as being in compliance with generally accepted accounting principles (“GAAP”), and that accordingly, Ocwen Financial Corp will restate such financial statements.

NYSE:OCN shares declined to as low as $24.87 per share on August 12, 2014, and closed at $25.16 per share.