A class action lawsuit was filed last Tuesday by a San Diego law firm against Tarragon Corp. in the U.S. District Court for the Southern District of New York. The lawsuit was done on behalf of the purchasers of Tarragon’s common stock between January 5, 2005, and August 9, 2007.
The law firm - Coughlin Stoia Geller Rudman & Robbins LLP, alleges Tarragon and certain officers and directors issued materially false and misleading statements concerning the company’s business and financial results.
A spokesman from Tarragon said that it’s company policy not to comment on pending litigation.
The lawsuit alleges that Tarragon stock traded at artificially inflated prices, reaching a high of $26.76 per share on July 22, 2005. It states that this is the result of the defendants’ false statements. The stock then reached a downfall of 94 cents a share on August 9, 2007. This happened when Tarragon said that its quarterly report would be delayed to the company time to evaluate more than $125 million in property impairment charges and other write-downs made necessary by its decision to sell properties under harsh market conditions.
Tarragon and its subsidiaries are operating in the Northeast, Florida, Texas, and Tennessee. One of its subsidiaries based in Fort Lauderdale is the developer of Las Olas River House, a high-rise downtown Fort Lauderdale that was completed last year. It still has at least 22 units up for sale.