Milberg Weiss Announces Filing of Class Action Suit on Behalf of Purchasers of Creditrust Corp. Securities.
NEW YORK--(BUSINESS WIRE)--Aug. 24, 2000
The following is an announcement by the law firm of Milberg Weiss Bershad Hynes & Lerach LLP:
The law firm of Milberg Weiss Bershad Hynes & Lerach LLP announces that a class action lawsuit was filed on August 24, 2000, on behalf of purchasers of the securities of Creditrust Corporation ("Creditrust" or the "Company") (NASDAQ: CRDQE) between July 29, 1998 and March 31, 2000 inclusive. A copy of the complaint filed in this action is available from the Court, or can be viewed on Milberg Weiss' website at: http://www.milberg.com/creditrust/
The action is pending in the United States District Court for the District of Maryland against defendants Joseph K. Rensin (President and Chief Executive Officer), Richard I. Palmer (Chief Financial Officer), J. Barry Dumser (President and Chief Operating Officer) and John L. Davis (Vice President). Creditrust, a Delaware Corporation with headquarters in Baltimore Maryland, is not a defendant in this action because it has filed for bankruptcy.
The complaint charges that defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 promulgated thereunder, by issuing a series of material misrepresentations to the market between July 29, 1998 and March 31, 2000. The complaint alleges that Creditrust was in the business of purchasing bad debt receivables at a discount to the total debt owed and then attempting to collect more than it paid for the debt. The Company's reported revenues are based on the amount the Company believes it can collect on a given receivable over five years and claimed that it used proprietary pricing models and software systems to generated its estimated rate of return.
As alleged in the complaint, in order create the impression that Creditrust was a fast growing company, defendants knowingly or recklessly overestimated the amount the Company could collect on its bad debt receivables, resulting in a material overstatement of income and revenue. The complaint further alleges that defendant Rensin sold more than 500,000 shares of his personal holdings in the company during the class period for a profit in excess of $18 million.
If you bought the securities of Creditrust between July 29, 1998 and March 31, 2000 you may, no later than September 12, 2000, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member's claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Milberg Weiss Bershad Hynes & Lerach LLP, or other counsel of your choice, to serve as your counsel in this action.
Milberg Weiss Bershad Hynes & Lerach LLP (http://www.milberg.com) is a 160-lawyer firm with offices in New York City, San Diego, San Francisco, Los Angeles, Boca Raton and Seattle and is active in major litigations pending in federal and state courts throughout the United States. Milberg Weiss has taken a leading role in many important actions on behalf of defrauded investors, consumers, and others, and has been responsible for more than $20 billion in aggregate recoveries. Please contact the Milberg Weiss website for more information about the firm. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact the following attorneys:
Steven G. Schulman or Samuel H. Rudman One Pennsylvania Plaza, 49th fl. New York, NY, 10119-0165 Phone number: (800) 320-5081 Email: creditrustcase@milbergNY.com Website: http://www.milberg.com
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|Date:||Aug 25, 2000|
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