On July 1, 2011, a Stipulation of Dismissal with Prejudice (the “Dismissal”) was filed with the United States District Court for the Southern District of New York. The Dismissal was based on a class action lawsuit filed on March 3, 2011 against FXCM Inc., as well as certain officers and directors of the Company and three underwriters in its IPO (the “Defendants”). The lawsuit asserted claims under Sections 11 and 15 of the Securities Act and alleged false or misleading statements in the IPO prospectus regarding the Company’s business model and trading platforms, and sought an unspecified amount of damages on behalf of persons who purchased Class A common stock in the IPO. As a result of the Dismissal, all claims asserted by Plaintiff against Defendants were dismissed with prejudice.
On March 3rd, 2011 Kahn Swick & Foti, LLC (“KSF”) and KSF partner, Former Attorney General of Louisiana, Charles C. Foti, Jr., announced the commencement of the firm’s securities class action lawsuit against FXCM Inc. (“FXCM ” or the “Company”) (NYSE: FXCM). The lawsuit was filed in the United States District Court for the Southern District of New York on behalf of purchasers of FXCM common stock pursuant to its December 2010 Initial Public Offering (“IPO” or “Offering”) of 15,060,000 shares of common stock (with an overallotment option of 2,259,000 shares), priced at $14.00 per share.
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This suit was filed on claims on behalf of investor allegations that certain statements issued by the Company regarding FXCM’s business, operations and financial performance were materially false and misleading. This is due to the Citi’s earnings downgrade for FXCM’s stock price from $18 to $14 only 3 months after the IPO. On the day of the downgrade the stock fell 13% and many investors may have felt that the IPO price did not reflect the actual status.