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Press release content from Globe Newswire. The AP news staff was not involved in its creation.
PRESS RELEASE: Paid content from Globe Newswire
Press release content from Globe Newswire. The AP news staff was not involved in its creation.

Investor Alert: Kessler Topaz Meltzer & Check, LLP Reminds Investors of Securities Fraud ...

August 22, 2021 GMT

RADNOR, Pa., Aug. 22, 2021 (GLOBE NEWSWIRE) -- The law firm of Kessler Topaz Meltzer & Check, LLP announces that a securities fraud class action lawsuit has been filed in the United States District Court for the Eastern District of Virginia against James River Group Holdings, Ltd. (NASDAQ: JRVR) (“James River”) on behalf of those who purchased or acquired James River common stock between August 1, 2019 and May 5, 2021, inclusive (the “Class Period”).

Deadline Reminder: Investors who purchased or acquired James River common stockduring the Class Period may,no later than September 7, 2021, seek to be appointed as a lead plaintiff representative of the class. For additional information or to learn how to participate in this litigation please contact Kessler Topaz Meltzer & Check, LLP: James Maro, Esq. (484) 270-1453; toll free at (844) 887-9500; via e-mail atinfo@ktmc.com; or clickhttps://www.ktmc.com/james-river-class-action-lawsuit?utm_source=PR&utm_medium=link&utm_campaign=james_river

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James River is a holding company that owns and operates a group of specialty insurance and reinsurance companies. Its largest segment, Excess and Surplus (“E&S”) Lines insurance, focuses on insureds that generally cannot purchase insurance from standard lines insurers due to perceived risks related to their businesses. Included in this E&S Lines segments is James River’s Commercial Auto Division. In 2014, James River ramped up its Commercial Auto Division by underwriting a new type of insurance policy that covered Rasier LLC (“Rasier”), a subsidiary of the ride-sharing company, Uber Technologies, Inc. (together with Rasier, “Uber”). Until that time, ride-sharing insurance had only covered claims incurred while ride-sharing drivers were transporting passengers for Uber, thus leaving a gap in coverage for accidents caused by ride-sharing drivers while they were not providing transportation services for hire but were still logged on to the Uber applications and available to accept a ride. Uber was James River’s largest contract and accounted for more than 25% of its premiums in 2019.

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The Class Period commences on August 1, 2019, the day after James River issued a press release after market hours that reported “unfavorable reserve development of $2.3 million compared to unfavorable reserve development of $2.2 million in the prior year,” which included $1.2 million of unfavorable reserve development in the E&S Lines segment. At the beginning of the Class Period, the defendants assured investors that James River was adequately reserved against its Uber policies and that the defendants were “comfortable” with James River’s E&S Lines reserves. However, after the market closed on October 8, 2019, James River announced that it had delivered a notice of early cancellation, effective December 31, 2019, for all insurance policies issued to Uber, though James River would remain contracted to provide coverage for future claims related to the period the Uber polices were in effect. Throughout the Class Period, the defendants repeatedly assured investors that the legacy contract posed no challenges to James River.

The truth was revealed on May 5, 2021 when James River surprised the market by disclosing an additional $170 million of unfavorable reserves related to the Uber policies. In order to cover its losses, James River announced that it was seeking to raise $175 million through a public equity offering, which was priced at “the sector’s steepest discount ever” according to Bloomberg.

Following this news, James River’s stock price dropped $12.27 per share, or 26.83%, from a closing price of $46.50 per share on May 5, 2021 to a closing price of $34.23 per share on May 6, 2021.

The complaint alleges that throughout the Class Period, the defendants failed to disclose that: (1) James River had not adequately reserved for its Uber policies; (2) James River was using an incorrect methodology for setting reserves that materially understated its true exposure to Uber claims; (3) as a result, James River was forced to increase its unfavorable reserves in subsequent quarters even after cancelling the Uber polices; and (4) as a result, the defendants’ statements about James River’s business, operations, and prospects were materially false and misleading and/or lacked a reasonable basis.

James River investors may, no later than September 7, 2021, seek to be appointed as a lead plaintiff representative of the class through Kessler Topaz Meltzer & Check, LLP or other counsel, or may choose to do nothing and remain an absent class member.  A lead plaintiff is a representative party who acts on behalf of all class members in directing the litigation.  In order to be appointed as a lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class.  Your ability to share in any recovery is not affected by the decision of whether or not to serve as a lead plaintiff.

Kessler Topaz Meltzer & Check, LLP prosecutes class actions in state and federal courts throughout the country involving securities fraud, breaches of fiduciary duties and other violations of state and federal law. Kessler Topaz Meltzer & Check, LLP is a driving force behind corporate governance reform, and has recovered billions of dollars on behalf of institutional and individual investors from the United States and around the world.  The firm represents investors, consumers and whistleblowers (private citizens who report fraudulent practices against the government and share in the recovery of government dollars).  The complaint in this action was not filed by Kessler Topaz Meltzer & Check, LLP. For more information about Kessler Topaz Meltzer & Check, LLP please visit www.ktmc.com.

CONTACT:

Kessler Topaz Meltzer & Check, LLP
James Maro, Jr., Esq.
280 King of Prussia Road
Radnor, PA 19087
(844) 887-9500 (toll free)
info@ktmc.com