Block & Leviton LLP (www.blockesq.com), a securities litigation firm representing investors and whistleblowers nationwide, is providing an update regarding the pending litigation captioned Garfield v. BlackRock Mortgage Ventures, LLC, et al., C.A. No. 2018-0917-KSJM (Del. Ch.).
The litigation was filed on December 20, 2018 and challenges the fairness of a reorganization transaction announced on August 2, 2018. This transaction created a massive tax benefit for insiders who held units in PennyMac Financial Services, Inc.’s (NYSE: PFSI) operating subsidiary, but did not share any of those benefits with public stockholders who held Class A common stock.
On December 20, 2019, Vice Chancellor McCormick of the Delaware Court of Chancery denied Defendants’ Motions to Dismiss the Complaint and held that the facts and circumstances surrounding the reorganization raise an inference that both the process and price were not entirely fair. Shortly thereafter, Defendants sought reargument of their Motions to Dismiss, a request which the Court denied on January 21, 2020. The Action will now move into discovery.