Green & Noblin, P.C., is Prosecuting Claims On Behalf Of XO Communications, Inc. Shareholders against Salomon Smith Barney
Green & Noblin, P.C. is prosecuting claims on behalf of XO Communications, Inc. shareholders against Salomon Smith Barney and its former telecommunications research analyst, Jack Grubman, in connection with analyst reports touting the investment merits of those companies as they slid toward bankruptcy.
On December 2, 2004, The U.S. District Court for the Southern District of New York, held that plaintiffs have stated a valid claim on behalf of persons who purchased XO stock during the period from April 18, 2001 through Nobvember 2001. The complaint alleges that SSB and Grubman published analyst reports advising investors to "buy" stock, when neither Grubman or SSB believed that XO stock was a good investment. For example, on April 18, 2001, the court noted Grubman authored an email that stated "most of our banking clients are going to zero and you know I wanted to downgrade them months ago but got huge pushback from banking."
On September 23, 2002, the NASD Department of Enforcement filed a complaint against Mr. Grubman, alleging that Mr. Grubman improperly recommended the purchase of shares of several companies, including XO. without having a reasonable basis for doing so. The NASD also alleges that Mr. Grubman recommended the purchase of shares of AT&T, Worldcom, Global Crossing and other companies, all of which are now bankrupt, that had strong and profitable investment banking relationships with Salomon.
Separately, on September 30, 2002, Eliot Spitzer the Attorney General of the State of New York (the "NYAG") filed a complaint against Philip F. Anchutz, Bernard J. Ebbers, Stephan A. Garafalo, Clark E. McLeod, and Joseph P. Nacchio alleging that these individuals were beneficiaries of a practice employed by Salomon Smith Barney called "spinning." The NYAG also alleged that, in certain instances, Salomon and Mr. Grubman tailored investment recommendations based on their desire to obtain lucrative investment banking business from the companies they recommended, not the relative investment merits.
If you owned shares of XO Communications and would like to discuss your rights, please contact us.
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