Several defendants in “mega lawsuit” against Global Brokerage leave the company
The latest changes at Global Brokerage (former FXCM Inc) saw five of the defendants in the “mega lawsuit” brought by investors disgruntled by the February events, bid goodbye to top roles at the broker.
A number of top officers at Global Brokerage Inc (NASDAQ:GLBR), formerly known as FXCM Inc, are saying goodbye to their roles as a result of the “restructuring plan” announced by the company in a press release issued late on November 10, 2017. The company is set to file for bankruptcy under Chapter 11 and changes involving its senior ranks have to be expected, of course.
Let’s note that the reshuffle at the top involves individuals that are defendants in the so-called “mega lawsuit” against the broker – a class action on behalf of investors in the public securities of FXCM Inc. The action is brought on behalf of a putative class consisting of all persons and entities who purchased or otherwise acquired publicly traded FXCM securities from March 15, 2012 to February 6, 2017.
This class action names 17 individuals as defendants, on top of the broker itself. The list of individual defendants includes: Dror Niv, William Ahdout, David Sakhai, Eduard Yusupov, Janelle G. Lester, Robert Lande, Ornit Niv, Nicola Santoro, Jr., Margaret Deverell, David S. Sassoon, Kenneth Grossman, James Brown, Ryan Silverman, Arthur Gruen, Robin E. Davis, Eric LeGoff, and Bryan Reyhani.
In its press release issued on November 10, 2017, Global Brokerage mentioned the names of five of these defendants: David Sakhai, Eduard Yusupov, Margaret Deverell, Robert Lande, and David S. Sassoon. In particular, David Sakhai and Eduard Yusupov will resign from their positions as members of the Board of Global Brokerage. Margaret Deverell, Chief Accounting Officer, Robert Lande, Chief Financial Officer, and David S. Sassoon, General Counsel, will submit their resignations to the Board.
The press release said that “the resignation of these executives from Global Brokerage will allow each of them to focus their priorities in these roles to FXCM Group” and, yet, this states a consequence of the resignation and not the cause for the change.
The names of these five individuals are embroiled in the “mega lawsuit”. Under the complaint, defendants Niv and Lande, as well as Sakhai, Ahdout, Grossman, Yusupov, Brown, Silverman, Gruen, Davis, Legoff, Santoro (in 2012, 2013, 2014), Reyhani (2015), and Deverell (2015) each signed various FXCM 10-K’s filed with the SEC during the Class Period and are thus responsible for the misleading and omissive statements made in the filings they signed. Similarly, the Complaint alleges that Mr Sassoon, as General Counsel, signed proxy statements filed with the SEC on Form DEF 14 A during the Class Period.
The defendants have acknowledged they signed the 10-K filings in question. However, what their lawyer is contesting is whether their signatures on these filings are sufficient to prove their role in FXCM’s management and the alleged culpable participation.
FinanceFeeds will continue to monitor how the filing for Chapter 11 bankruptcy will affect the legal proceedings against Global Brokerage/FXCM, and vice versa.
