Kendall Law Group, led by a former federal judge, today announced that a lawsuit has been filed against Direxion Energy Bear 3X Shares Fund (NYSE: ERY), and exchange-traded fund offered by Direxion Shares ETF Trust. The lawsuit alleges securities violations related to false and misleading statements made by Direxion Shares between November 5, 2008 and April 9, 2009.
Any shareholder, who purchased Direxion Energy Bear stock during the above time period, may move the Court to serve as a plaintiff in this class action. If you wish to serve as lead plaintiff, you must move the Court for appointment by March 15, 2010. A lead plaintiff is a class member who acts on behalf of other class members in directing the litigation. Your ability to share in any recovery is not, affected by the decision to serve as a lead plaintiff.
The object of Direxion Energy Bear is to gain three times the daily performance of what Russell 1000® Energy Index loses, or in the alternative, lose three times what Russell gains. Due to the decline in the U.S. Market, investors anticipated a profit in their investment. However, when Russell declined approximately 11% between November 5, 2008 and April 9, 2009, they saw a 54% decline.
The complaint, filed in the Southern District of New York, alleges that due to the tracking error between the performance of Direxion Energy Bear and Russell, the investment is meaningless. According to the complaint, the fund is a defective product in that it did not do what it was designed, represented or advertised to do. Direxion Shares did not disclose that the investment option was a defective investment play, as it did not track three times the opposite of Russell Energy on a daily basis or for periods longer than one trading day. Had investors been aware of the misleading nature of the statements, they would not have purchased the shares, especially at the inflated prices that were paid.
Led by a former federal judge and former U.S. Attorney, Kendall Law Group has the credentials to pursue any type of complex securities litigation in the nation. If you wish to learn more about your rights as a shareholder or have information concerning this action, contact attorney Hamilton Lindley at 877-744-3728 or [email protected].
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