NEW YORK, March 1 /PRNewswire/ -- Dreier LLP (http://www.dreierllp.com/) today announced that a class action lawsuit was commenced in the United States District Court for the Central District of California, on behalf of purchasers of the common stock and/or call options and sellers of put options of New Century Financial Corporation ("New Century" or the "Company") during the period April 7, 2006 through February 7, 2007, inclusive (the "Class Period"). The complaint alleges violations of the federal securities laws, including Section 10(b) of the Securities Exchange Act.
If you purchased New Century common stock or call options during the Class Period or sold New Century put options during the Class Period, you may be a member of the proposed Class. You must move the Court on or before April 10, 2007 if you wish to serve as a lead plaintiff. Lead plaintiffs must meet certain legal requirements. To learn more about this lawsuit or if you are interested in serving as a lead plaintiff, please contact Plaintiffs' counsel, Daniel B. Scotti (
New Century is a real estate investment trust and mortgage finance company headquartered in Irvine, California. The Complaint alleges that, throughout the Class Period, Defendants issued materially false and misleading statements regarding the Company's business and financial results and failed to disclose, among other things, that: (1) the Company was under-reserving for loan losses as conditions in the sub-prime industry deteriorated; (2) the Company failed to take timely write-downs for residual interests in securitizations; (3) the Company lacked adequate internal and financial controls; (4) the Company's financial statements were not prepared in accordance with Generally Accepted Accounting Principals ("GAAP"); and (5) the Company's statements about its financial well-being and future business prospects were lacking in any reasonable basis when made. The Complaint further alleges that, as a result of these false statements and omissions, New Century securities traded at artificially inflated or distorted prices. On February 7, 2007, after the close of trading, New Century shocked investors when it announced that it would have to restate its 2006 financial statements, since they were not prepared in accordance with GAAP. In reaction to this news, the price of the Company's stock declined $10.92 per share, or 36%, to close on February 8, 2007 at $19.24 per share, on unusually heavy trading volume. Plaintiffs seek to recover damages on behalf of all members of the proposed Class.
Plaintiffs are represented by Dreier LLP and Gutride Safier LLP. Dreier LLP's Class Action Litigation Group has vast experience representing domestic and foreign institutional and individual investors in securities and other class actions throughout the country. The partners who head Dreier LLP's Class Action Litigation Group have successfully prosecuted securities fraud class actions in a wide variety of industries and have played a significant role in cases that have resulted in some of the largest securities class action settlements.
