NEW YORK, May 17, 2006 (PRIMEZONE) -- Wechsler Harwood LLP today announced that it has filed a class action suit on behalf of all securities purchasers of Fairfax Financial Holdings Ltd. (NYSE:FFH) ("Fairfax Financial" or the "Company") between March 24, 2004 through March 21, 2006, both dates inclusive (the "Class Period"). This action is also brought on behalf of all purchasers of Fairfax Financial 7.75% senior notes due April 26, 2012 (the "Sub-Class"), pursuant to the August 25, 2004 offering registration statements and/or prospectus.
The action, entitled Fisher et al v. Fairfax Financial Holdings Ltd., et al, Case No. 1:06-cv-03713-GBD is pending in the United States District Court for the Southern District of New York, and names as defendants the Company, its Chairman and CEO, V. Prem Watsa, its CFO (until May 13, 2005), Trevor Ambridge, its VP and CAO, M. Jane Williamson, its VP and Corporate Secretary, Bradley P. Martin, and Directors, Anthony F. Griffiths and Robert Hartog. A copy of the complaint can be obtained from the Court or can be viewed on the Wechsler Harwood website at www.whesq.com
Fairfax Financial, through its subsidiaries, operates as an underwriter of property and casualty insurance and reinsurance. The complaint alleges that defendants made false and misleading statements regarding the Company's financial performance by improperly accounting for transactions relating to finite contracts and treaties at its Odyssey Re Holdings subsidiary ("Odyssey Re") and concealing an internal review of those matters. As a result, the price of the Company's securities was artificially inflated during the Class Period, thereby harming investors.
The Complaint charges defendants with violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Sections 11, 12(a)(2) and 15 of the Securities Act of 1933. More specifically, the complaint alleges that, during the Class Period, the Company failed to disclose and misrepresented the following material adverse facts which were known to defendants or recklessly disregarded by them: (a) it employed flawed and defective accounting practices and internal controls; (b) it understated its reserves; and (c) it utilized aggressive off-balance sheet mechanisms.
On March 21, 2006, defendants revealed details of a broadly escalated governmental investigation into the Company, following the issuance of a subpoena in response to defendant Watsa's statements regarding the Company's internal review of improper accounting practices at the Company and at Odyssey Re. On this news, the price of Fairfax Financial stock plummeted from its closing price of $130.90 on March 21, 2006, to close on March 22, 2006 at $113.93, for a loss of $16.97 or 12.9%, on unusually heavy trading volume.
If you are a member of the class described above, you may, not later than June 12, 2006, move the Court to serve as lead plaintiff of the class, if you so choose. A lead plaintiff is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed 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. Under certain circumstances, one or more class members may together serve as "lead plaintiff." Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Wechsler Harwood, or other counsel of your choice, to serve as your counsel in this action
Wechsler Harwood has taken a leading role in many important actions on behalf of defrauded shareholders, employee investors and consumers and is responsible for hundreds of millions of dollars in recoveries. You can obtain a copy of the complaint by visiting the Wechsler Harwood website at www.whesq.com or by contacting the firm directly. The Wechsler Harwood website contains detailed information regarding this matter and additional information about the firm. If you wish to discuss this action with us, or have any questions concerning this notice or your rights and interests with regard to the case, please contact plaintiff's counsel Jeffrey M. Norton at (877) 935-7400 (ext. 286) or a firm representative.
More information on this and other class actions can be found on the Class Action Newsline at www.primezone.com/ca