NEW YORK, NY--(Marketwired - Oct 17, 2014) - Bernstein Litowitz Berger & Grossmann LLP ("BLB&G") today announced that it has filed a securities class action lawsuit on behalf of the Automotive Machinists Pension Plan against EZCORP, Inc. ("EZCORP" or the "Company") (NASDAQ: EZPW), as well as certain of the Company's officers (the "Officer Defendants"), and its controlling shareholder, Phillip Ean Cohen ("Cohen") and MS Pawn Limited Partnership ("MS Pawn"). The action asserts claims under the Securities Exchange Act of 1934 ("Exchange Act") on behalf of investors in EZCORP common stock during the period of April 19, 2012 through October 6, 2014, inclusive (the "Class Period"). A copy of the Complaint is available on BLB&G's website at www.blbglaw.com.
The Complaint expands the class period that was asserted in a related action against EZCORP, captioned Close v. EZCORP, Inc., No. 14-cv-6834 (S.D.N.Y.) ("Close"), which is the first-filed securities class action in this matter and is presently pending before the Honorable Andrew L. Carter, Jr. Pursuant to the notice published on August 22, 2014 in connection with the filing of the Close action, as required by the Private Securities Litigation Reform Act of 1995, investors wishing to serve as lead plaintiff are required to file a motion for appointment as lead plaintiff by no later than October 21, 2014. The filing of the Complaint by BLB&G does not alter that deadline.
The Complaint alleges that beginning on April 19, 2012 and throughout the Class Period, EZCORP and certain of its senior executives violated provisions of the Exchange Act by disseminating false and misleading press releases, financial statements, filings with the Securities and Exchange Commission and statements during investor conference calls. As alleged in the Complaint, throughout the Class Period, EZCORP and certain of its senior executives misrepresented significant facts concerning EZCORP's business and operations, including that the Company and its Cash Genie business complied with all relevant regulations governing its businesses. The Complaint also alleges that the Defendants misrepresented the nature of EZCORP's consulting relationship with an entity owned by Cohen, the Company's controlling shareholder.
In a series of corrective disclosures, EZCORP revealed drastic changes to the Company's senior leadership, a significant decline in growth, and admitted that its Cash Genie business appeared to have committed "serious" violations of consumer protection laws. On the last day of the Class Period, the Company revealed a reorganization of its business, explaining that it was exiting its online businesses in both the United Kingdom (its "Cash Genie" operations) and the United States, that these changes would result in approximately $110 million in goodwill impairments and other charges, and that it was lowering its guidance. As a result of these disclosures, the price of EZCORP stock declined dramatically, damaging the members of the class.