BankAtlantic sues firm over defamation regarding bank failure article

July 22, 2008 by · Leave a Comment
Filed under: Bank Failure, Industry News 

It looks like the IndyMac failure has heighten the tension the banks are feelings. Robert Bove who is an analyst, wrote an article about possible bank failures named “Who is Next?”. BankAtlantic filed suit against Ladenburg Thalmann & Co. and the analyst for defamation.

In the article, Robert used a metric to measure banks that were at risk and BankAtlantic felt that was not correct and it was slandering the bank’s reputation. According to Bloomberg, BankAtlantics shares fell 25% to close at .90 on July 14th after the report was published.

Article:

BankAtlantic Bancorp Inc. sued Ladenburg Thalmann & Co. and analyst Richard Bove for a report on possible bank failures called “Who is Next?,” alleging the institution was defamed by its inclusion.

BankAtlantic, a unit of BFC Financial Corp., sued for defamation and negligence in a complaint filed today in state court in Broward County, Florida. BankAtlantic, based in Fort Lauderdale, jumped as high as 31 percent.

“While Bove’s report purports to consider which banks might fail, he failed to examine the health of the banks and thrifts in his report,” BankAtlantic Chairman Alan Levan said in a statement. “He only examined holding company data which, in at least our case, is meaningless information.”

The Florida lawsuit follows a North Carolina appeals court ruling in April holding that analysts couldn’t be sued for expressing opinions. In that case, Nucor Corp., the largest U.S. steelmaker by market value, lost a bid to reinstate a libel and unfair trade practices lawsuit against Prudential Equity Group LLC and two former analysts for comments made in a report.

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