IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK
MICHAEL LOUIS KUSHNER, On )
) No. 00CIV4653
Behalf of Himself and All Others )
Similarly Situated, )
)
Plaintiff, )
)
vs. )
)
RELIANCE GROUP HOLDINGS, )
INC. SAUL P. STEINBERG, )
ROBERT M. STEINBERG, )
)
HOWARD E. STEINBERG and
LOWELL C. FREIBERG
Defendants.
PLAINTIFF'S CLASS ACTION COMPLAINT
Plaintiff, by and through his attorneys, allege the following upon the investigation
of counsel, except as to those allegations concerning plaintiff, which are alleged
upon personal knowledge, including, among other things, the investigation of his
attorneys, including without limitation: (a) review and analysis of public filings
made by Reliance Group Holdings, Inc. ("Reliance," or the "Company"), with the
Securities and Exchange Commission (the "SEC"); (b) review and analysis of
securities analysts' reports concerning Reliance; (c) review and analysis of press
releases and other publications disseminated by defendants; and (d) other publicly
available information about Reliance.
1. This action is brought as a class action on behalf of all persons who purchased
the common stock of Reliance from February 8, 1999 through May 10, 2000 (the
"Class Period"). Plaintiff's claims arise under Section 10(b) of the Securities
Exchange Act of 1934 (the "Exchange Act") and SEC Rule 10b-5 promulgated
thereunder and pursuant to Section 20(a) of the Exchange Act.
JURISDICTION AND VENUE
2. This Court has jurisdiction over the subject matter of this action pursuant to
Section 27 of the Exchange Act, 15 U.S.C. §78aa and pursuant to 28 U.S.C.
§§1331 and 1337. The claims asserted herein arise under and pursuant to Sections
10(b) and 20(a) of the Exchange Act and present federal questions.
SNIPPETS:
Plaintiff, by and through his attorneys, allege the following upon the investigation
review and analysis of public filings
made by Reliance Group Holdings, Inc., with the
securities analysts' reports concerning Reliance; review and analysis of press
releases and other publications disseminated by defendants;
This action is brought as a class action on behalf of all persons who purchased
Exchange Act of 1934 and SEC Rule 10b-5 promulgated
a substantial number of the false and misleading statements complained of were prepared and
Plaintiff's purchases of the Company's common stock are set forth in the accompanying
Defendant Saul P. Steinberg has, at all material times, been the Company's Chief Executive
Defendant Howard E. Steinberg, served, during the Class Period, as Reliance's Chief of
For the quarter, Reliance announced that it would be reporting an operating loss of $36.5
Those statements appeared in public filings with the SEC and in Reliance press releases.
As alleged herein, defendants acted with scienter in that defendants knew that the public
ecurities laws.
This case does not involve allegations of false forward-looking statements or projections but
Excluded from the Class are the defendants, members of the defendants' immediate families,
a workers' compensation insurance facility created and managed by Unicover Managers, Inc., a
the Company was likely to sustain material losses in connection with business written through
Unicover Managers, Inc., a third party manager of reinsurance pools.
Reliance National understands that several of its retrocessional reinsurers,
invalidate existing reinsurance contracts.
Defendants also caused the financial statements which were contained within the 1998 Form
increasing net loss reserves and an expense of $103.2 million paid to reinsurers
Net policy claims and settlement expenses for the second quarter and first six
another of the Company's retrocessionaires,
Defendants, who include the top officer of the Company, had actual knowledge of the material
luding plaintiff and the Class.
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