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Robbins Geller Rudman & Dowd LLP Files Class Action Suit on Behalf of Purchasers of VelocityShares Daily 2x Long VIX Short-Term Exchange Traded Notes

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SAN DIEGO--(BUSINESS WIRE)--

Robbins Geller Rudman & Dowd LLP (“Robbins Geller”) (http://www.rgrdlaw.com/cases/velocity/) today announced that a class action has been commenced in the United States District Court for the Southern District of New York on behalf of purchasers of VelocityShares Daily 2x Long VIX Short-Term ETNs (“VIX ETNs”) (NASDAQ: TVIX) between November 30, 2010 and March 22, 2012 (the “Class Period”).

If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from May 25, 2012. 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. If you are a member of this class, you can view a copy of the complaint as filed or join this class action online at http://www.rgrdlaw.com/cases/velocity/. 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 VelocityShares, LLC and certain of its officers and directors and Credit Suisse AG and certain of its related entities (collectively, “Credit Suisse”) and their officers and/or directors with violations of the Securities Exchange Act of 1934.

The VIX ETNs were designed to replicate, net of expenses, the returns of twice (2x) the daily performance of the S&P 500 VIX Short-Term Futures index. As alleged in the complaint, on November 29, 2010, Credit Suisse disseminated the VelocityShares Pricing Supplement. The Pricing Supplement and subsequent Pricing Supplements included an important section entitled “Hypothetical Examples.” The Hypothetical Examples section described more specifically the risk profile of the VIX ETNs by noting several variables that would affect the returns on the VIX ETNs. This section was meant to illustrate the effect that different factors could have on the ultimate payment and returns on an investment in the VIX ETNs. The complaint alleges, however, that the description of these factors was misleading and omitted a key factor: the effect of changes in the relationship between short-term measures of volatility and longer-term measures of volatility, sometimes referred to as the “term structure” of volatility, which was a crucial and undisclosed risk associated with the VIX ETNs. The Hypothetical Examples were designed to conceal this risk and were not representative of randomly calculated possibilities generated by a computer. Ultimately, the price of the VIX ETNs reached $100.90 in October 2011.

On February 21, 2012, the VIX ETNs increased in price when Credit Suisse announced it had “temporarily suspended further issuances of the [VIX ETNs] due to internal limits on the size of VIX ETNs.” Credit Suisse added that “[t]his suspension does not affect the early redemption right of holders as described” in the Pricing Supplement. This caused an increase in the price as the VIX ETNs became scarcer. However, once this suspension was rescinded in March 2012, the price fell again. By March 26, 2012, the VIX ETNs had dropped to $5.88 per ETN, from $15.13 per ETN just one week earlier. On March 29, 2012, it was disclosed that the Financial Industry Regulatory Authority was investigating the VIX ETNs and other exchange traded notes and that the Massachusetts securities regulator was looking into the VIX ETNs' February through March 2012 transactions.

Plaintiff seeks to recover damages on behalf of all purchasers of VIX ETNs during the Class Period (the “Class”). 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 represents U.S. and international institutional investors in contingency-based securities and corporate litigation. With nearly 200 lawyers in nine offices, the firm represents hundreds of public and multi-employer pension funds with combined assets under management in excess of $1.5 trillion. The firm has obtained the largest recoveries in history in six of the eight categories of shareholder class action settlements and has been ranked number one in the number of shareholder class action recoveries in MSCI's Top SCAS 50 every year since 2003. According to Cornerstone Research, the firm's recoveries have averaged 35% above the median for all firms over the past seven years (2005-2011). Please visit http://www.rgrdlaw.com for more information.

Robbins Geller Rudman & Dowd LLP
Darren Robbins
800/449-4900 or 619/231-1058
djr@rgrdlaw.com

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