Reddy Ice Holdings (FRZ) Stock Fraud
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In conjunction with our partner lawyers, we are currently investigating claims for Reddy Ice Holdings, Inc. shareholders who purchased shares of Reddy Ice Holdings, Inc. and lost money on their investment as a result of the Company's recent announcements.
Our Experienced Stock Fraud Lawyers and Attorneys Have Years of Experience Representing Shareholders in Numerous Stock Fraud Cases.
Reddy Ice is the largest manufacturer and distributor of packaged ice products in the United States. On March 6, 2008, Reddy Ice announced that federal officials executed a search warrant at the Company's corporate office in Dallas on March 5, 2008. The execution of the search warrant was directed by the Antitrust Division of the United States Department of Justice. Following that announcement, shares of Reddy Ice fell to an all-time low.
According to a statement released by Reddy Ice, the Justice Department antitrust division searched its headquarters "in connection with an investigation of the packaged ice industry." According to a Company spokesperson, Justice officials took "various documents and information." Neither the Justice Department, Reddy Ice or other companies in the ice industry would provide details of any investigation. However, Reddy Ice said that its board of directors had formed a special committee of independent directors to conduct an internal investigation.
On March 7, following the announcement of the Reddy Ice raid, shares of the company dove $7.73, or 33.5 percent, to close at $15.38 Friday, and fell to a low of $12 earlier in the session. Reddy Ice shares began trading in August 2005 and set their previous low of $18.52 on their third day of trading.
Following the announcement of the Justice Department Reddy Ice investigation, several investor ratings services downgraded Reddy Ice stock. On March 7, Wachovia downgraded Reddy Ice Holdings, Inc. from Outperform to Market Perform. Wachovia said in a statement that it had made the decision to downgrade Reddy Ice because of the lack of information the Company had provided regarding the Justice Department investigation. Wachovia said that Reddy Ice "stock is likely to trade without regard to fundamentals given the information void, at least until more details become available."
On March 14, Moody's Investors Service also changed its rating outlook on Reddy Ice Holdings, Inc. to negative, concluding a review for possible downgrade that was initiated on July 3, 2007. Moody's said the negative outlook incorporated the "significant risks" to the Company from the ongoing antitrust investigation, although the nature, timing and severity of any potential sanctions are unclear. Moody's said it was concerned that the investigation could distract management attention from the business and could lead to material legal defense costs, monetary penalties and changes in the competitive position of Reddy Ice.
If you or someone you know owned stock in Reddy Ice Holdings, Inc. and suffered financial losses following the announcement of the Justice Department investigation, you have valuable legal rights. Please contact one of the Reddy Ice stock fraud lawyers at our firm by filling out our online form or calling 1-800-LAW INFO (1-800-529-4636).