Rare Result.It is rare for a securities class-action suit Noun 1. class-action suit - a lawsuit brought by a representative member of a large group of people on behalf of all members of the group class action to actually go to trial, and rarer yet for plaintiffs to win back more than pennies on the dollar. But David Lefkowitz David Lefkowitz is a playwright, theater critic and radio personality, born and raised in New York. As "Dave" Lefkowitz, he is the producer and host of Dave's Gone By, a weekly radio show that has aired on Long Island's WGBB (AM-1240) since Oct. 6, 2002. , partner in the Santa Monica-based law firm Wilshire Palisades Palisades, cliffs along the west bank of the Hudson River, NE N.J. and SE N.Y., extending from N of Jersey City, N.J., to the vicinity of Piermont, N.Y., with a general altitude of from 350 ft to 550 ft (107–168 m). Group, successfully concluded a case in late October against Olde Discount Corp. brokerage, which paid investors 115 percent of losses, or $21 million. "I only took this case five years ago because I was young and immoderate im·mod·er·ate adj. Exceeding normal or appropriate bounds; extreme: immoderate spending; immoderate laughter. See Synonyms at excessive. ," Lefkowitz said last week. "I spent $215,000 of my own money on the case, and, of course, a major portion of five years professionally. It wasn't a wise investment, but I guess it worked out." It helped that the Feds were knocking on the same door. Lefkowitz, representing a class of roughly 2,000 investors, alleged in an Arizona state court that Olde Discount pushed clients into about 200 specially selected stocks in which the brokerage had taken a position. He said the brokerage told investors they could buy brokerage-recommended small capitalization stocks "commission free." In fact, he alleged, it made money either on the spread -- the difference between bid and asked prices, sometimes substantial on thinly traded Thinly traded Infrequently traded. Nasdaq stocks -- or by simply being a market maker (owning a large chunk of the stock), and driving the price up by recommending the stock to clients Lefkowitz's case, initially brought in 1996, received boosts along the way, when both the SEC and NASD NASD See: National Association of Securities Dealers NASD See National Association of Securities Dealers (NASD). investigated Olde Discount and brought administrative proceedings against the firm. In 1998, the NASD fined Olde Discount $1.5 million -- and founder Ernst Olde $500,000 personally -- for the same sales practices that Lefkowitz cited in his class action case. The SEC also fined Olde Discount $4 million the same year citing the same issues. Olde was purchased in 1999 by H&R Block Inc., the Kansas City-based financial and tax preparation service. In a statement last week, the Big Board-listed H&R Block said it settled the case to avoid expensive litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. , that it continues to deny liability, and noted that Olde Discount management has been changed since the acquisition. Contributing columnist Benjamin Mark Cole writes about the local investment community for the Los Angeles Business Journal. |
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