GRABAR LAW OFFICE INVESTIGATES CLAIMS AGAINST OFFICERS AND DIRECTORS OF ROCKET COMPANIES, INC. (NYSE: RKT)
Grabar Law Office is investigating claims on behalf of Rocket Companies, Inc. (NYSE: RKT) shareholders. The investigation concerns whether certain officers of Rocket Companies have breached their fiduciary duties owed to the company.
Rocket Mortgage is the largest mortgage lender in the United States.
A federal securities fraud class action complaint against Rocket has survived a motion to dismiss. The underlying class action complaint alleges that, throughout the Class Period (February 25, 2021 and May 5, 2021), Rocket Companies, through certain of its officers, made false and misleading statements and failed to disclose that: (i) Rocket Companies’ gain on sale margins were contracting at the highest rate in two years as a result of increased competition among mortgage lenders, an unfavorable shift toward the lower margin Partner Network operating segment, and compression in the price spread between the primary and secondary mortgage markets; (ii) Rocket Companies was engaged in a price war and battle for market share with its primary competitors in the wholesale market, which was further compressing margins in Rocket Companies’ Partner Network operating segment; (iii) the adverse trends identified above were accelerating and, as a result, Rocket Companies’ gain on sale margins were on track to plummet at least 140 basis points in the first six months of 2021; (iv) as a result, the favorable market conditions that had preceded the start of the Class Period and allowed Rocket Companies to achieve historically high gain on sale margins had vanished as Rocket Companies’ gain on sale margins had returned to levels not seen since the first quarter of 2019; (v) rather than remaining elevated due to surging demand, Rocket Companies’ company-wide gain-on-sale margins had fallen materially below pre-pandemic averages; and (vi) consequently, Defendants’ positive statements about Rocket Companies’ business operations and prospects were materially misleading and/or lacked a reasonable basis.
Current Rocket Companies shareholders who have held Rocket Companies stock since before February 25, 2021, can seek corporate reforms, the return of funds spent defending litigation back to the company, and a court approved incentive award, at no cost to them.
If you would like to learn more about this matter, you are encouraged to contact us at firstname.lastname@example.org, or call Joshua Grabar at 267-507-6085.