Girard Gibbs serves as lead counsel representing investors of SLM Corporation (“Sallie Mae”) in litigation alleging that Sallie Mae, the leading provider of student loans in the United States, misled the public about its financial performance in order to inflate the company’s stock price.
Specifically, the lawsuit alleges that between 2007 and 2008, Sallie Mae violated federal securities laws by concealing from the public that it had:
- Lowered the standards it used to qualify borrowers in order to increase its portfolio of lucrative private loans,
- Hid borrower defaults from the public by changing its loan forbearance policy, and
- Maintained inadequate reserves to compensate for potential loan losses in order to inflate profits.
The lawsuit alleges that the investors ultimately suffered investment losses when Sallie Mae’s stock price fell after the company’s true financial condition was revealed.
Sallie Mae Class Action Settlement Preliminarily Approved by Court
On April 18, 2012, the Court granted preliminary approval to a proposed settlement that would resolve claims of investors in SLM Corp. (Sallie Mae), who invested in the company’s stock between January 18, 2007 and January 23, 2008, and who possessed any of those shares over one or more of the dates of December 19, 2007, January 3, 2008 and January 23, 2008.
The proposed settlement will establish a $35 million fund to resolve investors’ claims. For more information regarding the settlement terms, see the Stipulation of Settlement, and Preliminary Approval Order.
The Court will hold a final approval hearing on August 3, 2012. To participate in the settlement, class members must submit a Proof of Claim postmarked no later than August 31, 2012. If you think you are a member of the class and have not received a notice of settlement and proof of claim form, you may download the forms through the box on the right.
To speak with our securities fraud lawyers call (866) 981-4800 or fill out the form to the right to receive email updates about the progress of the case. You may also find more information at the SML corporation securities litigation website.
Sallie Mae Class Action: Class Certified
On January 24, 2012, the Court formally certified the case against Sallie Mae as a class action, allowing it to proceed on behalf of all investors who purchased common shares of SLM Corporation between January 18, 2007 and January 23, 2008, and who possessed any of those shares over one or more of the dates of December 19, 2007, January 3, 2008 and January 23, 2008.