Paul Hastings Secures Dismissal with Prejudice of MRU Holdings Auction Rate Securities Case
New York, NY (February 17, 2011) Paul, Hastings, Janofsky & Walker LLP, a leading global law firm, announced today that the firm secured a dismissal with prejudice of an auction rate securities case involving MRU Holdings, a financial services company specializing in higher education financing.
The case was based on plaintiffs allegations that MRU's management violated federal securities laws by issuing false financial statements and other documents relating to MRU's issuance of auction rate securities and used manipulative devices to inflate MRU's share price. The plaintiffs also sued MRU's auditors and underwriter, both of whom were also dismissed from the case.
A District Court judge in the Southern District of New York agreed with the defendants' argument that the facts alleged to have been misrepresented or omitted in fact had in fact been disclosed by MRU, and that the plaintiffs had failed to establish that the defendants had any bad motive or intent to engage in any wrongdoing. The Court further stated that while it did not need to address loss causation in light of its other rulings, if it were to make such a finding, it would have found that plaintiffs failed to establish that the defendants had caused the alleged losses.
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