Welcome to the Ambac Financial Group, Inc. Securities Litigation Website
IMPORTANT UPDATE
On February 14, 2014, pursuant to the Order Approving Distribution Plan, the Net Settlement Fund in the In re Ambac Financial Group, Inc. Securities Litigation was distributed to Authorized Claimants whose distribution amount calculated to $20.00 or more. If you received a check, please cash it promptly. Failure to cash the check by the void date indicated on the check may result in forfeiture of funds.
This website provides a summary of information presented in more detail in the Notice of Pendency of Class Action and Proposed Settlements, Final Approval Hearing, and Motion for Attorneys' Fees and Reimbursement of Litigation Expenses (“Notice”). The content on this website incorporates, by reference, the definitions in the Stipulations of Settlement dated May 4, 2011 (“Stipulations”), and all capitalized terms used, but not defined herein, shall have the same meanings as in the Stipulations. Since this is just a summary, you should read the full Notice for additional details. The Notice and Stipulations are available for download on the left hand side of this page.
THE CLASS IS DEFINED AS FOLLOWS: ALL PERSONS AND ENTITIES WHO PURCHASED OR OTHERWISE ACQUIRED ANY AMBAC FINANCIAL GROUP, INC. SECURITIES, INCLUDING AMBAC EQUITY OR DEBT SECURITIES OR OPTIONS THEREON, OR ANY STRUCTURED REPACKAGED ASSET-BACKED TRUST SECURITIES, CALLABLE CLASS A CERTIFICATES, SERIES 2007-1, STRATS(SM) TRUST FOR AMBAC FINANCIAL GROUP, INC. SECURITIES, SERIES 2007-1 (“STRATS”) (COLLECTIVELY “AMBAC SECURITIES”) IN THE PERIOD FROM OCTOBER 19, 2005, THROUGH AND INCLUDING JULY 18, 2009.
IMPORTANT DATES AND DEADLINES
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Distribution of Net Settlement Fund
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February 14, 2014
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Submit a Claim Form
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Postmarked no later than October 24, 2011
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Exclude Yourself From the Class
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Received no later than September 7, 2011
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Object to the Settlements
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Received no later than September 7, 2011
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Final Approval Hearing
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September 28, 2011 at 10:00 am
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WHAT THIS CASE IS ABOUT
On January 16, 2008, a putative class action complaint was filed against Ambac and Individual Defendants Genader, Lassiter, Leonard and Gandolfo, in the United States District Court for the Southern District of New York, asserting claims under §§ 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b‐5 promulgated thereunder.
On August 25, 2008, Plaintiffs filed the operative complaint in this action, the Consolidated Amended Class Action Complaint (the “Complaint”), asserting claims under §§ 11, 12 and 15 of the Securities Act of 1933 and §§ 10(b) and 20(a) of the Exchange Act and Rule 10b‐5 promulgated thereunder against Defendant Ambac and certain of the Individual Defendants.
On December 24, 2008, the initial complaint in the Tolin Action, which alleged violations of the federal securities laws based on certain factual allegations similar to certain of the factual allegations in the Ambac Class Action, but on behalf of a different class of purchasers, was filed. An Amended Class Action Complaint in the Tolin Action was filed on January 20, 2009, asserting violations of the federal securities laws against Ambac, Genader and Leonard, on behalf of a putative class of persons who purchased or acquired Ambac STRATS.
On December 3, 2010, after considerable negotiation, Lead Plaintiffs and the Underwriter Defendants executed a Memorandum of Understanding reflecting an agreement to settle claims in the Ambac Class Action against the Underwriter Defendants and their related parties.
Lead Counsel and Tolin’s Counsel have conducted an extensive investigation relating to the claims and the underlying events and transactions alleged in the Complaints. Lead Counsel and Tolin’s Counsel have analyzed evidence adduced during their investigations and in discovery and have researched the applicable law with respect to the claims of Plaintiffs and the Class against Defendants, as well as the potential defenses thereto.
Based upon their investigation, Lead Counsel and Tolin’s Counsel have concluded that the terms and conditions of the Stipulations are fair, reasonable and adequate to Plaintiffs and the Class, and in their best interests, and have agreed to settle the claims raised in the Securities Actions pursuant to the terms and provisions of the Stipulations, after considering (i) the substantial benefits that Plaintiffs and the members of the Class will receive from resolution of the Securities Actions as against the Defendants, (ii) the attendant risks of litigation, and (iii) the desirability of permitting the Settlement to be consummated as provided by the terms of the Stipulations.
On June 14, 2011, the Court preliminarily approved both Settlements, preliminarily certified the Class, authorized the Notice to be sent to potential members of the Class, and scheduled the Final Approval Hearing to consider whether to grant final approval to the Settlements.
THE BENEFITS OF THE SETTLEMENTS
The Settlement Fund will consist of the following sub-funds: (1) a $27,100,000 settlement fund established pursuant to the settlement with the Ambac Defendants (the “Ambac Settlement Fund”); and (2) a $5,900,000 settlement fund established pursuant to the settlement with the Underwriter Defendants (the “Underwriter Settlement Fund”), with any interest income allocated proportionately between the sub-funds.
The $27,100,000 Ambac Settlement Fund will be paid as follows: certain Directors’ and Officers’ insurance carriers (“D&O Insurers”) shall pay $24,600,000 and, subject to Bankruptcy Court approval, Ambac will pay the additional $2,500,000. If approved by the Bankruptcy Court, the entire $2,500,000 paid by Ambac will be used to compensate Authorized Claimants with respect to any Class Period purchases or other acquisitions of Ambac Debt Securities. Further, 25% of the $24,600,000 paid by Ambac’s insurance carriers, or $6,150,000, will be used to compensate Authorized Claimants with respect to any Class Period purchases or other acquisitions of Ambac Debt Securities. The $2,500,000 paid by Ambac, if approved, and the $6,150,000 paid by the insurers, or a total of $8,650,000, shall be the “Ambac Debt Securities Settlement Fund”. The remaining 75% of the $24,600,000 paid by the insurers, or $18,450,000, plus any interest earned thereon, shall be the “Ambac Common Stock Fund,” and will be used to compensate Authorized Claimants with respect to any purchases or other acquisitions of Ambac Common Stock and/or Ambac Call Options during the Class Period and/or any Ambac Put Options written during the Class Period.
The Underwriter Settlement Fund will be used to compensate Authorized Claimants with respect to their purchases or other acquisitions of Ambac DISCS either in the initial offering of the security or in the open market from February 12, 2007 to July 18, 2009.
THE COURT’S FINAL APPROVAL HEARING
The Final Approval Hearing will be held on September 28, 2011, at 10:00 a.m. before the Honorable Naomi Reice Buchwald, at the United States District Court for the Southern District of New York, Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, Courtroom 21A, New York, NY 10007. The Court reserves the right to approve the Settlements, the Plan of Allocation or the request for attorneys’ fees and reimbursement of litigation expenses at or after the Final Approval Hearing without further notice to the members of the Class.
IF YOU ARE A CLASS MEMBER YOU HAVE THE FOLLOWING OPTIONS
SUBMIT A CLAIM FORM
This is the only way to be potentially eligible to receive a payment. If you wish to be potentially eligible to obtain a payment as a member of the Class, you will need to file a claim form, which is included with the Notice, postmarked no later than October 24, 2011.
To download a copy of the claim form, please click here and follow the direction provided.
EXCLUDE YOURSELF FROM THE CLASS
Each Class Member will be bound by all determinations and judgments in this lawsuit, including those concerning the Settlements, whether favorable or unfavorable, unless such person or entity mails, by first‐class mail (or its equivalent outside the United States), or otherwise delivers a written Request for Exclusion from the Class, addressed to Ambac Financial Group, Inc. Securities Litigation, c/o Rust Consulting, Inc., P.O. Box 2457, Faribault, MN 55021‐9157. The exclusion request must be received no later than September 7, 2011. You will not be able to exclude yourself from the Class after that date. Each Request for Exclusion must (i) state the name and address of the person or entity requesting exclusion; (ii) state that such person or entity requests exclusion from the Class in In re Ambac Financial Group, Inc. Securities Litigation, Case No. 08‐cv‐00411‐NRB and/or Tolin v. Ambac Financial Group, Inc. et al., Case No. 08‐cv‐11241‐CM; (iii) be signed by the person or entity requesting exclusion; (iv) provide a telephone number for that person or entity; and (v) provide the date(s), price(s) and number(s) of shares of all purchases, acquisitions and sales of Ambac Securities during the Class Period. Requests for exclusion will not be valid if they are not received within the time stated above, unless the Court otherwise determines. Keep a copy of everything you mail, in case something is lost during shipping or processing.
OBJECT TO THE SETTLEMENTS
If you are a Class Member, you can object to the Settlements if you do not like any part of it. Write to the Court and explain why you do not like the Settlements, the proposed Plan of Allocation, or the request for attorneys’ fees and reimbursement of expenses. You cannot object to the Settlements unless you are a member of the Class and do not validly exclude yourself.
To contest the approval of the terms and conditions of the proposed Settlements, the Plan of Allocation, and/or the motion for attorneys’ fees and reimbursement of litigation expenses, one must file a written objection with the Court and serve copies of the objection in the manner provided in the Notice such that it is received no later than twenty‐one (21) calendar days (September 7, 2011) prior to the Final Approval Hearing on:
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Lead Counsel for the Class
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BERNSTEIN LITOWITZ BERGER & GROSSMANN LLP
Steven B. Singer
1285 Avenue of the Americas, 38th Floor
New York, NY 10019
KAPLAN FOX & KILSHEIMER LLP
Frederic S. Fox
850 Third Avenue, 14th Floor
New York, NY 10022
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Counsel for Ambac
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WACHTELL, LIPTON, ROSEN & KATZ
Peter C. Hein
51 West 52nd Street
New York, NY 10019
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Counsel for the Underwriter Defendant
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PAUL, WEISS, RIFKIND, WHARTON & GARRISON LLP
Charles E. Davidow
1285 Avenue of the Americas
New York, NY 10019
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Clerk’s Office
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United States District Court Southern District of New York
United States Courthouse
Ruby J. Krajick
Clerk of the Court
500 Pearl Street
New York, NY 10007
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PLEASE DO NOT CONTACT THE CLERK'S OFFICE OR THE COURT REGARDING THESE SETTLEMENTS