Hagens Berman Files Amended Complaint against BlackRock Relating to the August 24, 2015 Flash Crash
San Francisco - Hagens Berman Sobol Shapiro LLP has filed an amended complaint against BlackRock Inc., iShares Trust and their affiliates on behalf of investors of BlackRock iShares Exchange Traded Funds (“ETFs”) who suffered losses due to price discrepancies that arose during the August 24, 2015 Flash Crash.
The potential class includes those who purchased or otherwise acquired iShares ETFs between June 16, 2013 and August 24, 2015 (the “Class Period”) and sold their iShares ETFs on August 24, 2015 pursuant to a market or stop-loss order, and were damaged thereby. For more information, visit:
Or contact Hagens Berman Sobol Shapiro LLP by emailing iShares@hbsslaw.com.
The complaint alleges that Defendant BlackRock and its affiliates represented ETFs “offer the same” trading liquidity as stocks while BlackRock knew from prior experience that ETF trading liquidity presented additional and different material risks from that of traditional stocks or mutual funds. In particular, BlackRock reported to regulators that in September 2008 and 2010, when prices fell rapidly, ETF market and stop-loss orders exacerbated ETF price declines disproportionately to an ETF’s underlying assets or net asset value (“NAV”). As a result, many investors who sold ETF shares pursuant to market or stop-loss orders sold at prices far below the underlying NAV of their ETF portfolio. Investors and their advisors remained ignorant of the unique risks of using market or stop-loss orders with iShares ETFs.
Then, on Monday, August 24, 2015, iShares investors who placed market or protective stop-loss orders prior to or at the opening of the markets were again slammed with disproportionate losses when 19.2% of all ETFs experienced price declines of more than 20%, compared to an average decline of only 4.7% in underlying corporate securities. Investors in Blackrock’s iShares ETFs suffered significant damages as a result.
Whistleblowers: Persons with non-public information regarding the underlying structural illiquidity of ETFs, and BlackRock iShares ETFs in particular, should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new SEC whistleblower program, whistleblowers who provide original information may receive rewards totaling up to 30% of any successful recovery made by the SEC. For more information, call Reed Kathrein at 510-725-3000 or email us at iShares@hbsslaw.com.
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About Hagens Berman
Hagens Berman is a national investor-rights law firm headquartered in Seattle, Washington with offices in 10 cities. The Firm represents investors, whistleblowers, workers and consumers in complex litigation. More about the Firm and its successes can be found at www.hbsslaw.com. Read the Firm’s Securities Newsletter, and visit the blog. For the latest news visit our newsroom or follow us on Twitter at @classactionlaw.
Reed Kathrein, 510-725-3000
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