NEW YORk, Feb. 02, 2024 (GLOBE NEWSWIRE) — The law firm of Kirby McInerney LLP reminds investors that a class action lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of those who acquired B. Riley Financial, Inc. (“B. Riley” or the “Company”) (NASDAQ: RILY) securities during the period of May 10, 2023 through November 9, 2023, inclusive (“the Class Period”). Investors have until March 25, 2024 to apply to the Court to be appointed as lead plaintiff in the lawsuit.
[Click here to learn more about the class action]
In May 2023, B. Riley entered an agreement to support its client, Brian Kahn, in leading a management buyout of Franchise Group, Inc. (FRG), partially financed by Nomura and completed as a $2.8 billion deal on August 21, 2023. On November 2, 2023, The Department of Justice charged John Hughes, an executive of Prophecy Asset Management, with conspiracy to defraud investors of $294 million. The Securities Exchange Commission also filed a complaint against Hughes based on the same conduct. On November 3, 2023, The Friendly Bear tweeted that the DOJ’s case documents clearly implicated Kahn as one of two unnamed co-conspirators in the conspiracy, a claim also reported by Bloomberg. The Friendly Bear expressed doubts about whether B. Riley knew of Kahn’s involvement and disclosed it to Nomura. On this news, the price of B. Riley shares declined by $9.02 per share, or approximately 21.70%, from $41.56 per share to close at $32.54 on November 6, 2023.
On November 9, 2023, the Company disclosed details of the complex transactions involving B. Riley, Kahn, and subsidiaries, which resulted in the buyout of FRG on August 21, 2023. The Friendly Bear reported that “B Riley ended up funding 281MM of what was around a 560MM equity check. That’s over 50% ownership. Yet they claim to have only 31% voting rights. It looks like B Riley engaged in some funny business to avoid consolidation and placed control of FRG in the hands of the star of ‘Prophecy’ – Brian Kahn.” On this news, the price of B. Riley shares declined by $4.47 per share, or approximately 14.87%, from $30.07 per share to close at $25.60 on November 10, 2023. The Company’s stock price continued to fall $4.59, or 17.93%, over the next consecutive trading session to close at $21.01 per share on November 13, 2023.
If you purchased or otherwise acquired B. Riley securities, have information, or would like to learn more about this investigation, please contact Thomas W. Elrod of Kirby McInerney LLP by email at investigations@kmllp.com, or by filling out this contact form, to discuss your rights or interests with respect to these matters without any cost to you.
Kirby McInerney LLP is a New York-based plaintiffs’ law firm concentrating in securities, antitrust, whistleblower, and consumer litigation. The firm’s efforts on behalf of shareholders in securities litigation have resulted in recoveries totaling billions of dollars. Additional information about the firm can be found at Kirby McInerney LLP’s website.
This press release may be considered Attorney Advertising in some jurisdictions under the applicable law and ethical rules.
Contacts
Kirby McInerney LLP
Thomas W. Elrod, Esq.
212-699-1180
https://www.kmllp.com
investigations@kmllp.com
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