T. Jeffrey Simpson, et al. v. Homestore.Com, Inc., et
Analysis Group was retained by the law firm Paul Hastings LLP on behalf of defendant Stuart Wolff, CEO of Homestore.com, in a securities fraud class action. The plaintiffs, a certified class of investors in Homestore.com stock, claimed they had suffered losses when the company's stock price significantly dropped on the news that Homestore.com had artificially inflated its ad revenues. An Analysis Group team led by Vice President Eric Korman collaborated with Professor Meir Statman of Santa Clara University to develop a rational framework for assessing loss causation on a per-share and per-statement basis. Ultimately, the jury found Mr. Wolff liable for $46 million in damages -- considerably less than the $1.25 billion estimated by the plaintiffs' expert. However, the Analysis Group team and counsel for Mr. Wolff were able to show that he need make no payment given that his codefendants had already paid out $121 million in settlements before Mr. Wolff's trial.
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