A San Francisco federal judge has issued an order certifying a class action lawsuit against Charles Schwab & Co. alleging securities law violations in connection with Schwab’s beleaguered YieldPlus Fund. The parties are required to submit to the court by September 10, 2009, a proposed timeline for class members that want to opt out of the class action. An updated blog posting will be issued once the opt out deadline is known. Click here to view all YieldPlus blog postings.
Three Classes of Investors Are Included in the Class Action
The court’s order creates three different classes of plaintiffs. The three classes are:
- Yield Plus investors that acquired shares between November 15, 2006, and March 17, 2008.
- YieldPlus investors that acquired shares between May 31, 2006, and March 17, 2008.
- California residents who held shares in the YieldPlus fund on September 1, 2006.
YieldPlus investors not included in the above categories are excluded from the class action. However, investors omitted from the class still have the option of filing their own securities arbitration claim against Schwab to recover their YieldPlus losses. Unlike class actions, which must be pursued in court, individual claims must be submitted to arbitration before the Financial Industry Regulatory Authority (FINRA).
Class Members Can Opt Out of the Class Action
Members included the class action also have the right to opt out of the class. Class members that elect to opt out can file a claim for their YieldPlus losses with FINRA.. For more information about opting out of a class action and submitting an arbitration claim, please see our blog posting: Securities Arbitration vs. Class Actions: Consider Your Options