August 7, 2008 - The court granted the notice of voluntary dismissal without prejudice.
August 6, 2008 - The plaintiff filed a notice of voluntary dismissal without prejudice.

June 6, 2008 - An investor in shares of Wachovia Corporation (NYSE: WB) filed a lawsuit in the U.S. District Court for the Northern District of California over alleged violations of Federal Securities Laws by Wachovia Corporation in connection with certain allegedly false and misleading statements made between May 8, 2006 through April 11, 2008.

In summary, the complaint alleges that Defendants misled investors by falsely representing that Wachovia Corporation had strict and selective underwriting and loan origination practices and a conservative lending approach that set it apart from other lenders. Such reassurances were repeated by defendants throughout the time between May 8, 2006 and April 11, 2008 in order to artificially support Wachovia Corporation’s stock price in the midst of a weakening mortgage market. In response to increased market concern with the mortgage lending industry, and Wachovia Corporation’s option ARMs in particular, Wachovia Corporation falsely represented that its loan underwriting practices were much better than at other banks and that this would allow it to prosper while lenders with less exacting standards and procedures would fare much worse. In reality, Wachovia Corporation’s actual lending practices differed materially from the description of those practices in statements made to investors. Wachovia Corporation’s ability to weather the deterioration in the real estate and credit markets was grossly exaggerated by defendants, at precisely the worst time, when analysts began to ask tough questions. Wachovia Corporation, moreover, had inadequate loan loss reserves and falsely represented that its capital position was sufficient to fund its dividend. Shortly after last assuring the market of its liquidity, the strength of its underwriting practices, and the adequacy of its reserves, Wachovia Corporation reported a surprise quarterly loss, undertook emergency measures to increase capital, and cut its dividend. On April 14, 2008, before the open of ordinary trading, Wachovia Corporation reported a loss of $350 million, or $0.20 per share, for the first quarter of 2008. Wachovia Corporation attributed the results to: (1) a $2.8 billion increase credit loss reserves, including $1.1 billion specifically for “Pick-A-Pay” reserve build, the lending program highly touted by Wachovia Corporation during the time between May 8, 2006 and April 11, 2008. The need to increase Pick-A-Pay reserves was attributed to Wachovia Corporation’s adoption of a “refined reserve modeling” that resulted in “higher than expected loss factors on Pick-a-Pay”; and (2) $2 billion in mark-to-market losses for mortgage backed securities, including a “$729 million loss on unfunded leveraged finance commitments.” In order to shore-up its capital, Wachovia Corporation announced the following steps: (1) reduce the dividend 41% to $0.375; and (2) plan to raise capital by $7-8 billion through public offerings. In reaction to the news, shares fell from $27.81 to $25.55 (8.13%) on abnormally high volume.

This marks the third separate action filed against Wachovia Corporation in 2008. The other two cases are related to Auction Rate Securities and stock offerings.