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ALL.US
id: 803

Allstate Corporation (ALL) $90M Shareholder Settlement

N.D. Illinois
Court
1:16-cv-10510
Case number
29 Oct 2014
Class period Start
03 Aug 2015
Class period End
08 Feb 2024
Claim deadline
Allstate $ALL agreed to settle $90 million with shareholders over claims of misleading about the spike in its auto insurance business.

The lawsuit came after Allstate reported unexpectedly high claims payouts from auto accidents, causing a larger-than-expected decline in quarterly operating profit.
  • On August 3, 2015, Allstate reported disappointing Q2 2015 financial performance. The company revealed that it had experienced a third consecutive quarter of increased frequency in auto insurance claims, leading to a significant 57% decrease in operating income. Moreover, the operating earnings per share fell short of the analysts' consensus estimate.
  • Subsequent to the release, the CEO of Allstate explained that the decline in quarterly profit was primarily attributed to a decline in auto insurance margins. The CEO elaborated that the decrease in auto insurance margins was a result of higher claim frequency and severity, which outweighed the average increases in auto insurance prices.
As a consequence of these revelations, $ALL experienced a sharp and rapid decline, damaging shareholders.

On November 10, 2023, shareholders filed an initial complaint alleging the Company and its certain leaders issued false and misleading statements and/or failed to disclose adverse information regarding the Company's business and prospects, including that the reason for the sudden spike in its auto claims frequency, which they claimed was due to external events beyond the Company's control, including the weather and increased miles driven, was actually the result of Allstate's growth in its auto policy business through higher risk drivers.
Case Status
Accepting Late Claims
Alleged Offence
Misleading Statements
Failure to Disclose
Omissions
Suspected Party
Directors
Management
Security Type
Stocks
Trade Direction
Long
Payout per Share
0.66
Filing date
10 November 2016
Plaintiffs
Carpenters Pension Trust Fund for Northern California, Carpenters Annuity Trust Fund for Northern California, City of Providence
Attorneys
Labaton Sucharow LLP, Pomerantz LLP, Thornton Law Firm
Defendants
Thomas J. Wilson, Matthew E. Winter
Judge
Hon. Robert W. Gettleman
Administrator
A.B. Data Ltd
Settlement agreement date
2023-08-14
Court hearing date
19 December 2023
Exclusion deadline
28 November 2023
Objection deadline
28 November 2023
Hearing deadline
28 November 2023
Trades matching type
FIFO
+$90,000,000
Cash Settlement Amount

Allstate Corp

The Allstate Corporation, together with its subsidiaries, provides property and casualty, and other insurance products in the United States and Canada. The company operates through Allstate Protect...

    Ticker
    ALL.US
    ISIN
    US0200021014
    CIK
    899051
    Sector
    Financial Services
    Industry
    Insurance - Property & Casualty
    Country
    USA
    Address
    3100 Sanders Road, Northbrook, IL, United States, 60062