Stull, Stull & Brody Files Class Action Lawsuit On Behalf of Investors in ProShares UltraShort FTSE/Xinhua China 25 Proshares Fund NEW YORK--(BUSINESS WIRE)--The law firm of Stull, Stull & Brody announces that it has filed a class
action complaint in the U.S. District Court for the Southern District of
New York on behalf of all persons who purchased or otherwise acquired
shares in the UltraShort FTSE/Xinhua China 25 Proshares Fund (the “FXP
Fund”) (NYSEArca: FXP - News), an exchange-traded fund (“ETF”) offered by
ProShares Trust (“ProShares”), pursuant or traceable to ProShares’ false
and misleading Registration Statement, Prospectuses, and Statements of
Additional Information (collectively, the “Registration Statement”)
issued in connection with shares of the FXP Fund (the “Class”). The
Class is seeking to pursue remedies under Sections 11 and 15 of the
Securities Act of 1933 (the “Securities Act”). In addition to the claims concerning ProShares FXP Fund, Stull, Stull & Brody is also investigating claims on behalf of investors in other ProShares leveraged funds (the “Funds”) (see list below), such as whether ProShares failed to disclose in its registration statements: (i) that if shares of the Funds were held for a time period longer than one day, the likelihood of massive losses was huge; and (ii) the extent to which performance of the Funds would invariably diverge from the performance of the benchmark.
The complaint names ProShares, ProShare Advisors LLC, SEI Investments Distribution Co., Michael L. Sapir, Louis M. Mayberg, Russell S. Reynolds, III, Michael Wachs, and Simon D. Collier as defendants (collectively, “Defendants”). ProShares sells its Ultra and UltraShort ETFs as “simple” directional plays. As marketed by ProShares, Ultra ETFs are designed to go up when markets go up; UltraShort ETFs are designed to go up when markets go down. The FXP Fund is one of ProShares’ UltraShort ETFs. The FXP Fund seeks investment results that correspond to twice the inverse (–200%) daily performance of the FTSE/Xinhua China 25 Index (“FTSE”). Accordingly, the FXP Fund is supposed to deliver double the inverse return of the FTSE, which fell approximately 47 percent from January 2, 2008 through December 31, 2008, ostensibly creating a profit for investors who anticipated a decline in the FTSE. In other words, the FXP Fund should have appreciated by over 94 percent during this period. However, the FXP Fund fell approximately 55 percent during this period. The complaint alleges the Defendants violated the Securities Act by failing to disclose the following risks, inter alia, in the Registration Statement: (1) if FXP Fund shares were held for a time period longer than one day, the likelihood of catastrophic losses was huge; and (2) the extent to which performance of the FXP Fund would inevitably diverge from the performance of the FTSE -- i.e., the overwhelming probability, if not certainty, of spectacular divergence. If you purchased or otherwise acquired ProShares FXP shares, and either lost money on the transaction or still hold the shares, you may apply to the Court to serve as lead plaintiff. A “lead plaintiff” is a representative party that acts on behalf of other class members in directing the litigation. In order to be appointed lead plaintiff, the Court must determine that the class member’s claim is typical of the claims of other class members, and that the class member will adequately represent the class. Under certain circumstances, one or more class members may together serve as lead plaintiff. Your ability to share in any recovery is not, however, affected by the decision whether or not to serve as a lead plaintiff. You may retain Stull, Stull & Brody, or other counsel of your choice, to serve as your counsel in this action. Stull, Stull & Brody has litigated many class actions for violations of securities laws in federal courts over the past 40 years and has obtained court approval of substantial settlements on numerous occasions. Stull, Stull & Brody maintains offices in New York and Los Angeles. If you wish to discuss this action or the investigation regarding any of the Funds listed above, or if you have any questions concerning this notice or your rights or interests with respect to these matters, please contact Aaron Brody, Esq. at Stull, Stull & Brody by e-mail at ssbny@aol.com, or by calling toll-free 1-800-337-4983, or by fax to 1-212-490-2022, or by writing to Stull, Stull & Brody, 6 East 45th Street, New York, NY 10017. You can also visit our website at www.ssbny.com. Attorney Advertising. Prior Results Do Not Guarantee A Similar Outcome. Contact: Stull, Stull & Brody Aaron Brody, Esq., 1-800-337-4983 Fax: 1-212-490-2022 ssbny@aol.com www.ssbny.com Source: Stull, Stull & Brody
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