Robbins Geller Rudman & Dowd LLP Files Class Action and Derivative Suit against Certain Officers and Directors of Imperial Holdings, Inc.

SAN DIEGO--(BUSINESS WIRE)--

Robbins Geller Rudman & Dowd LLP ("Robbins Geller") today announced that an action has been commenced in the United States District Court for the Southern District of Florida against the Board of Directors (the "Board" or "defendants") of Imperial Holdings, Inc. ("Imperial Holdings") IFT as a class action on behalf of all public holders of Imperial Holdings common stock for violations of the Securities Exchange Act of 1934 (the "1934 Act") and breach of fiduciary duty in connection with the adoption by the Board of a bylaw (the "Bylaw") that requires current and former shareholders who wish to file a class or derivative action against or on behalf of Imperial Holdings, its directors, or its officers to first obtain written consent from other shareholders beneficially owning at least 3% (or over 642,000) of the Company's shares, and as a derivative action on behalf of Imperial Holdings for breach of fiduciary duty, waste of corporate assets, abuse of control, and gross mismanagement.

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from today. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact plaintiff's counsel, Darren Robbins of Robbins Geller at 800/449-4900 or 619/231-1058, or via e-mail at djr@rgrdlaw.com. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.

The complaint charges the members of Imperial Holdings' Board with violations of the 1934 Act, breach of fiduciary duty and/or waste of corporate assets, abuse of control and gross mismanagement, and further seeks a declaratory judgment that the Bylaw is contrary to law and against public policy. Specifically, the complaint alleges the Bylaw was adopted on November 3, 2014 in breach of defendants' fiduciary duties because its sole intent is to reduce the Board's risk of being held accountable to the Company or its shareholders for any violations of law, including criminal law, breaches of fiduciary duties or other misconduct, and to protect the Board members' tenure by entrenching their control of the Company.

In addition, the complaint alleges that defendants caused Imperial Holdings to file a false and misleading Proxy with the SEC in connection with defendants' attempt to obtain a shareholder "advisory vote" on the Bylaw. The Proxy is false and misleading and/or fails to disclose material information to the Company's shareholders and violates §14(a) of the 1934 Act and Rule 14a-9 promulgated thereunder by: (a) creating a materially misleading impression that shareholder litigation serves no legitimate purpose; (b) failing to explain the meaning of the following sentence: "nor does it apply to claims . . . where a private right of action at a lower threshold . . . is expressly authorized by statute;" (c) creating a materially misleading comparison between the Bylaw and inapt statutes and laws; (d) failing to disclose material information concerning IRS and SEC investigations of Imperial Holdings; (e) failing to disclose the basis for the Board's stated belief that the Bylaw will not unduly deter the prosecution of meritorious litigation; (f) failing to disclose the basis for the Board's stated belief that current law (including Rule 11, the PSLRA, and the business judgment rule) is not adequate to deter unmeritorious litigation; (g) failing to disclose the Board's understanding – in view of its own self-interest – of what constitutes meritorious or unmeritorious litigation; (h) failing to disclose that of the purported nine shareholders who individually own at least 3% of the Company's outstanding shares, many are insiders; (i) failing to disclose what basis the Board has for choosing a 3% threshold of ownership, as opposed to any other percentage; (j) failing to disclose the basis for the representation that the Bylaw will reduce the cost of D&O insurance; (k) failing to disclose the existence of litigation in the United States District Court for the Southern District of New York, which could be grounds for future representative litigation against the Company and its directors and/or officers; (l) failing to disclose the fact that individual shareholder pursuit of "meritorious" litigation is disincentivized by the cost and complexity of such litigation, which is only tempered by the ability to pursue class and derivative litigation; and (m) being contradictory with respect to whether the vote on the Bylaw is "advisory" or not.

Plaintiff seeks injunctive and declaratory relief on behalf of all public holders of Imperial Holdings common stock (the "Class") and derivatively on behalf of Imperial Holdings. The plaintiff is represented by Robbins Geller, which has expertise in prosecuting investor class actions and extensive experience in actions involving financial fraud.

Robbins Geller, with 200 lawyers in ten offices, represents U.S. and international institutional investors in contingency-based securities and corporate litigation. The firm has obtained many of the largest securities class action recoveries in history, including the largest securities class action judgment. Please visit http://www.rgrdlaw.com for more information.

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