Colonial Bank earns security class action lawsuit over violating the federal securities laws

Colonial-BankAccording to the announcement of the law firm of Whatley Drake & Kallas, LLC (WDK) a class action lawsuit has been filed in the United States District Court for the Middle District of Alabama on behalf of purchasers of common stock of Colonial BancGroup, Inc. on behalf of all individuals who acquired CNB stock between Jan. 23, 2008 and Jan. 27, 2009 (the “class period”).

The complaint, which was filed on February 25, 2009, alleges that Colonial and several of its executives issued materially false and misleading statements that violated the federal securities laws.

The complaint alleges that Colonial and its officers presented a false and misleading picture of its financial health for two basic reasons:

First, they misrepresented Colonial’s financial health by misstating Colonial’s financial health in the face of the downturn in the housing market.

Second, they misstated the conditions on which Colonial would be allowed to participate in the Troubled Asset Relief Program (TARP), the program created by the U.S. Department of the Treasury to shore up the balance sheets of banks across the country by allowing them either to (1) offload troubled real-estate backed loans or (2) receive new capital in exchange for a combination of warrants and preferred and/or common stock in participating institutions.

If you are a member of this class and wish to serve as lead plaintiff, you must move the Court no later than April 10, 2009. Any member of the class may move the Court to serve as lead plaintiff through the counsel of their choice.

For further details please contact either Adam Plant ( aplant@wdklaw.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it ) or Tom Butler ( tbutler@wdklaw.comThis e-mail address is being protected from spam bots, you need JavaScript enabled to view it ) of WDK at 1-800-695-6750 or 1-205-328-9576, or via e-mail.

You may also contact Joe R. Whatley Jr. of Whatley Drake & Kallas,
at (205/328-9576).

Source: Whatley Drake & Kallas, LLC


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