Allied Evades Investors' Suit Over $77M Fraud

Law360, New York (November 12, 2009, 2:06 PM EST) -- A federal judge has killed a shareholder suit against Allied Capital Corp., saying investors have failed to state a claim that the business loan provider knew of a $77 million case of fraud at one of its portfolio companies that they claim caused their stock to plummet.

Judge Jack D. Shanstrom of the U.S. District Court for the District of Columbia granted Allied's motion to dismiss the putative class action in an order signed Nov. 4 and docketed on Tuesday.

The judge rejected the shareholders' contention...
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