Judge Sinks Shareholder Action Against Franklin Bank

Law360, New York (March 22, 2011, 2:28 PM EDT) -- A Texas federal judge on Monday dismissed all claims with prejudice in a consolidated class action alleging Franklin Bank Corp. and its directors, officers and outside auditors lied to shareholders in order to keep the now-defunct bank afloat.

The plaintiffs in the suit failed to prove that each of the defendant officers and directors of the bank lied in order to artificially raise the bank’s stock price and stave off a collapse, instead grouping all of the defendants’ statements together and alleging a collective lie, Judge...
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