Stunned Bear Stearns Investors Eye Legal Claims

[DeSwiss]

Source: Reuters

Reuters
By Martha Graybow
2 hours, 30 minutes ago

NEW YORK (Reuters) - Angry Bear Stearns Co Inc shareholders have wasted no time in calling their lawyers to pursue potential legal recourse over the company's $2-a-share fire sale to JPMorgan Chase & Co. "I can't divulge privileged conversations, but shareholders don't contact me when they are happy with the way things are going with their investments," said Ira Press, a lawyer at class-action firm Kirby McInerney, which has spoken with dismayed Bear investors about the matter.

"This is a stock that has gone from 50 to 2 literally overnight, and I also know of people who had assumed that the worst had passed when it closed at 30," he said. Bear Stearns, one of the most venerable names on Wall Street, is being sold for just $236 million in an emergency deal backed by the U.S. Federal Reserve in a sign of the deepening credit crisis. The deal's value is more than 90 percent below the company's Friday closing share price of $30.85.

But JPMorgan said the total price tag would be $6 billion to account for litigation and severance costs. Investors have barely had time to digest the news, but are already exploring possible legal avenues, say plaintiffs' lawyers who specialize in suing large corporations.

"We've been contacted by large individual investors and institutional investors," said Jeffrey Nobel, a partner at class-action law firm Schatz Nobel Izard. "Suffice to say, we are certainly looking very carefully at it."

Read more: http://news.yahoo.com/s/nm/20080317/us_nm/bearstearns_lawsuits_dc

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- The howitzers are being moved into position. This is going to take a while.....
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DeSwiss


http://atheisttoolbox.com/">The Atheist Toolbox

[merwin]

1. I'm starting to be glad that my 401K isn't that big.

I'm only 27 years old, so the $10k that's in my 401K isn't that huge of a deal to me. I feel sorry for the people who have hundreds of thousands invested and are going to lose it all because of corporate greed.

[MercutioATC]

3. I have a little over $200k in mine...it's all in treasuries for now.

For those with a 401k who get a choice of investment options, now is obviously not the time to be in stocks....

[H8fascistcons]

5. This is what happens when you vote republican

Yes corporate greed but this could not have happened without the criminal Fascist republicans, dismantling the financial regulations that were in place to keep this very thing from happening. This was totally preventable.....This is a repeat of the republican created savings and loan crisis of the 80's. America when will you ever learn the criminal Fascist republicans can not govern, PERIOD!!!

[Psephos]

16. You ought to read Taleb's "The Black Swan" n/t

[calimary]

23. That's not just a good point, that's a slogan! "This is what happens when you vote republi-CON"

or "that's what you get when you vote republi-CON." This should be repeated again and again until it sinks in - to cast doubt on the whole notion of voting for the GOP. We have to break the party loyalty AND sour the brand name. Poison the well.

And it has the added advantage of being true. Look what we've gotten when our nation voted republi-CON. How's it workin' out for ya so far? Are you happy with the way things are these days? Are you pleased with the track record and the results over the last - oh, say maybe - eight years? And there's always the ever-popular ronald reaganism: are you better off now than you were eight years ago?

If we pound that one home effectively enough, we could run a spare tire against john mccain and win.

[DeSwiss]

9. Yeah, I know what you mean....

....a woman my wife works with lost her house that was financed with a subprime mortgage loan. And it didn't have to happen because she'd had a traditional FHA-insured loan, but had been convinced by her broker to re-fi because of the low introductory rates. Then when her interest rate shot up 4.5% she cashed out her IRA of about $30K and paid the penalty. But it wasn't enough and still lost the house when she couldn't keep up the payments.

I think a lot of people who lost their homes were like her. They got bad advice and had no clear understanding of what they were dealing with. They trusted that the bankers and brokers were telling them the truth. But this whole thing was a lie from the beginning.

For myself, I went to energy stocks and bonds in my self-directed IRA in 1997. Given the realities in the world, it seemed only prudent at the time.

[JenniferJuniper]

13. I cashed out a few weeks ago

Of course, it's a pretty hopeless situation all around because of the situation with the dollar.

The guillotine would be too kind......

[LuckyLib]

2. These corporate criminals should be in jail, but then again, given that *'s administration is

still walking free, it's not likely.

[DeSwiss]

10. The absence of any kind of justice.....

...for these cretins is bad enough. But the worst insult is that they're using the government to make us pay for it all....

[ooglymoogly]

4. The Morgan family are well known for manipulating the markets

to their huge benefit and the total disregard for ethics and others....witness the great depression of 29 caused by Morgan, Mellon and a few other greedy bankers then became heroes by stepping in and buying everything for 10 cents on the dollar catapulting them into financial ether.

[katty]

6. good luck getting any $

[katty]

7. my 401 is diversified in euro markets

[ooglymoogly]

8. euros is the best place to have money.

or in purely money market funds that have proven their acumen.
proven commodities funds will also work. imo.

[bicentennial_baby]

11. A suit was already filed this afternoon, per CNBC

[sarcasmo]

12. Remember Enron?, no you fools, you won't be getting anything back.

On a side note, did anyone jump out of a building today?

[flvegan]

14. 14,000 employees also losing everything.

Not only their jobs (most likely) but also their pay, as a lot of them got a significant part of their salary in stock. And if they vote against the acquisition, JPMC can immediately buy the building and throw them all out. That would take their biggest asset and send them into bankruptcy. And on top of that, the stock is still virtually worthless in comparison to where it was.

[slackmaster]

27. I got burned on that company stock thing once

It won't happen again.

[formercia]

15. Grosse Bertha

[Aviation Pro]

17. How do you like that invisible hand now....

...buttercups? Sorry, asswipes, there are only winners and losers in your world. Toughen up, cupcakes.

[dysfunctional press]

18. the value just went "poof" it's GONE- where do they expect to get settlements from...?

:shrug:

[unkachuck]

19. well look at this....

"...in an emergency deal backed by the U.S. Federal Reserve..."

....screw the jagoff bear stearns shareholders and jpmorgan too....they liked playing capitalism, so now smile and sit on adam smith's invisible finger....

....they're gambling with this gauranteed-to-lose crap-shoot using our money....our Universal Healthcare money....socialism for the rich has got end....like everything else in this system, it's upside-down and backwards....

"...JPMorgan said the total price tag would be $6 billion..."

....with 30 billion backed by your and my future Social Security money?....fat fuckin' chance, go broke assholes, go to jail, and then to hell....

....the rich worthless republican prick-ass scum are stealing us blind....

[Tansy_Gold]

21. Can someone please explain to me why this was done?

Oh, I know the obvious answer, and it's probably the really accurate one: Fed money (meaning, our taxes) is going to bail out the very very rich because it can, and because that's what the powerful do -- they bail out their friends. Those who are the big-time investors in Bear Stearns, including pension funds and so on, will be "protected," and will be used as propaganda to drum up support for this welfare for the uber-wealthy. I know all that.

But when the excuse becomes "The government has to prop them up because the alternative is total loss of confidence in the stock market, and if the stock market fails, then the whole economy is wiped out in a twinkling of an eye," isn't that pretty much, well, bullshit?

How much, really, does "the economy" depend on the stock market? Yes, again, I understand that there are corporations that are nothing but investment companies and their functioning depends on making profits through the buying and selling of stocks, but is that really the economy?

And please, I'm not being facetious here. I understand -- or at least I think I understand -- the fundamentals of corporate capitalism. I understand that individuals who have more cash than they need to survive invest that excess cash in various ventures to help them out and then are repaid from the profits of said venture. But once the stock is out there, and once the corporation has put the income from the sale of the stock into the company's operations, does the market really affect it?

But also, what good does it do if the feds prop up a company that was poorly run and collapsed of its own mistakes? How does this "restore confidence" in the market? Does it restore confidence in error-prone decision makers? What in goodness' name would we put our confidence in after the Enron and WorldCom and Tyco and Global Crossing and CountryWide and Bear Stearns debacles? These are not enterprises that failed because of natural disasters or something else outside their control. They all failed because of HUMAN GREED. Is THAT what we're supposed to maintain confidence in? (I suppose the answer to that rhetorical question is actually "yes." Sad.)

Who is really being bailed out here? The stockholders, yes, but didn't they "invest" in Bear Stearns with some understanding that there were risks involved? And didn't they, when they saw the problems developing a year or two ago, have an opportunity to get out and cut their losses? Why should they, rather than the people who were swindled out of their life savings and suckered into sub-prime mortgages they couldn't pay, be bailed out with our money?

I'm tired of bailing out the rich. I'm tired of bailing out people who wouldn't need to be bailed out if they weren't gambling with the full knowledge that they were taking no risks -- that if they lost, *we* would bail them out. If you know there's no risk, well, there's no risk! It's a sure thing!

I need to shut up, or I'll have a stroke.

Oh, and a belated thank you to whoever it was that gave me the Valentine heart. I was out of town and out of internet range for a while due to a death in the family and am just now, a month later, getting back into circulation.

Tansy Gold, mouthy as usual

[PassingFair]

25. Welcome back, Tansy!

Good to have your voice back on the board.

Sorry about your family member. :(

[CONN]

20. Hmm "But JPMorgan said the total price tag ... $6 billion to account for ... severance"

... so the managers of Bear Stearns agree to sell it for huge discount to JPM. JPM then plans to spend billions on severance pay to the Bear Stearns' managers...

Seems strange?

[DLnyc]

22. Good catch.

Seems criminal, actually.

[gulfcoastliberal]

24. LOL, we know what litigation will be about!

That is unbelievable. Hiding the theft of billions in plain sight.

[Name removed]

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