NEW YORK (Legal Newsline) - Attorneys who bagged a couple of major public pension funds as clients have quickly moved to be put in charge of shareholder litigation against Argo Group International Holdings.
The firm Grant & Eisenhofer filed suit Oct. 20 against the company, a Bermuda-based international underwriter accused of misleading investors about its financial status. The suit says Argo hid a "construction defect" in its core business, leading to a $7.11 drop in its value per share in February.
Grant & Eisenhofer filed the suit on behalf of the Police & Fire Department System City of Detroit in New York federal court. The Dec. 19 motion asks the court to name the Detroit pension, as well as t Oklahoma Law Enforcement Retirement System, as lead plaintiffs.
Grant & Eisenhofer says it should also be appointed lead counsel. Its clients suffered $900,000 in losses, the motion says.
"G&E is among the most-respected securities class action law firms in the country and has served as lead counsel in several of the largest securities class actions in history..." the motion says.
According to the plaintiffs' class action, Argo underwrites international specialty insurance products in the property and casualty markets. The plaintiffs allege that Argo assured investors who purchased Argo stock from Feb. 13, 2018, through Aug. 9, 2022, of the company's success in managing its reserves.
They further allege that Argo's assurances were false and misleading because the company's reserves were "wholly inadequate" and because Argo "dramatically" changed its underwriting polices on some U.S. construction contracts.
The plaintiffs also allege that Argo's polices were underwritten "outside the company's 'core' business" and exposed the company to far riskier business than investors understood. The plaintiffs claim that due to the defendants' actions, Argo's common stock fell $7.11 per share in February of 2022 and that Argo was hiding information about the company's "construction defect" for five years.