Press release from Business Wire
Cohen Milstein Sellers & Toll PLLC Announces the Investigation of Knight Capital Group, Inc.
Wednesday, September 12, 2012
Cohen Milstein Sellers & Toll PLLC Announces the Investigation of Knight Capital Group, Inc.15:16 EDT Wednesday, September 12, 2012 WASHINGTON (Business Wire) -- Cohen Milstein Sellers & Toll PLLC is conducting an investigation to determine whether Knight Capital Group, Inc. (“Knight Capital” or the “Company”) and certain of its officers and directors made false and misleading statements and/or omissions in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as well as state law. A class action lawsuit was filed in the U.S. District Court for the Western District of Tennessee by another law firm on behalf of purchasers of the common stock of Knight Capital Group, Inc. (NYSE: KCG) between February 29, 2012 and August 1, 2012, inclusive (the “Class Period”). The complaint alleges that Knight Capital and certain of its officers and directors (“Defendants”) misrepresented and/or failed to disclose that: (1) “[m]otivated by changes to NYSE Rules taking effect on August 1, 2012, Knight Capital knowingly introduced unproven electronic trading software packages into the NYSE that destabilized the global equity markets”; (2) Knight Capital knew or should have known that its new electronic trading technology had the potential to engage in large-volume erroneous trading because massive amounts of trades could be placed in seconds; and (3) as a result, when the technology was implemented, Knight Capital erroneously acquired a large volume of stock at unfavorable prices. On August 1, the price of Knight Capital shares fell from $10.33 to $6.94 after it was reported that the Company had sent an e-mail advising its clients to route orders elsewhere, explaining that it had “experienced a technology issue” in its market-making unit “related to the routing of shares of approximately 150 stocks to the NYSE.” The following day, the Company publicly confirmed the “technology issue” which it said had resulted in a $440 million loss, stating in a press release: This issue was related to Knight's installation of trading software and resulted in Knight sending numerous erroneous orders in NYSE-listed securities into the market…Knight has traded out of its entire erroneous trade position, which has resulted in a realized pre-tax loss of approximately $440 million. Although the company's capital base has been severely impacted, the company's broker/dealer subsidiaries are in full compliance with their net capital requirements. Knight will continue its trading and market making activities at the commencement of trading today. The company is actively pursuing its strategic and financing alternatives to strengthen its capital base. The price of Knight Capital stock dropped from $6.94 to $2.58 on August 2 amid fears that the Company could be headed for bankruptcy. SEC Chairwoman Mary Schapiro called the August 1 events at Knight Capital “unacceptable,” adding that: . . . existing rules make it clear that when broker-dealers with access to our markets use computers to trade, trade fast, or trade frequently, they must check those systems to ensure they are operating properly.And, naturally, we will consider whether such compliance measures were followed in this case. Cohen Milstein encourages all investors who purchased Knight Capital common stock between February 29, 2012 and August 1, 2012 or former employees with information concerning this matter to contact the firm. If you are a Knight Capital shareholder and would like to discuss your right to recover for your economic loss, you may, without any cost or obligation, call Cohen Milstein's Managing Partner, Steven J. Toll at (888) 240-0775 or (202) 408-4600, or email him at email@example.com. If you wish to serve as lead plaintiff, you must move the Court no later than November 2, 2012 to request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. To be appointed lead plaintiff, the Court must decide that your claim is typical of the claims of other class members, and that you will adequately represent the class. Your share in any recovery will not be enhanced or diminished by the decision whether or not to serve as a lead plaintiff. Any member of the proposed class may retain Cohen Milstein Sellers & Toll PLLC or other attorneys to serve as your counsel in this action, or you may do nothing and remain an absent class member. Cohen Milstein Sellers & Toll PLLC has significant experience in prosecuting investor class actions and actions involving securities fraud. The firm has offices in Washington, D.C., New York, Chicago, Philadelphia and West Palm Beach, and is active in major litigation pending in federal and state courts throughout the nation. The firm's reputation for excellence has repeatedly been recognized by courts which have appointed the firm to lead positions in complex multi-district or consolidated litigation. Cohen Milstein Sellers & Toll PLLC has taken a lead role in numerous important cases on behalf of defrauded investors, and has been responsible for a number of outstanding recoveries which, in the aggregate, total over a billion dollars. Prior results do not guarantee a similar outcome. For more information visit www.cohenmilstein.com. If you have any questions about this notice or the action, or with regard to your rights, please contact either of the following: Steven J. Toll, Esq.Tyler GaffneyCohen Milstein Sellers & Toll PLLC1100 New York Avenue, N.W.West Tower, Suite 500Washington, D.C. 20005Telephone: (888) 240-0775 or (202) 408-4600Email: firstname.lastname@example.org; email@example.com Attorney Advertising Cohen Milstein Sellers & Toll PLLCSteven J. Toll, Esq.888-240-0775 or firstname.lastname@example.orgTyler Gaffney888-240-0775 or email@example.com