Class Action Follows MetLife’s Delayed Earnings Announcement
As previously reported, Kehoe Law Firm, P.C. commenced an investigation on behalf of MetLife, Inc. (NYSE:MET) investors to determine whether MetLife, Inc. and certain of its officers or directors engaged in securities fraud or other unlawful business practices, as a result of MetLife’s announcement that it would postpone the earnings report and conference call related to MetLife’s results for the fourth quarter and full year ended December 31, 2017.
On the news of MetLife’s delayed earnings report, MetLife’s stock price fell significantly in after-hours trading on January 29, 2018.
MetLife Class Action Lawsuit on Behalf of Purchasers of MET Securities Between February 27, 2013 and January 29, 2018, Both Dates Inclusive
A class action lawsuit was filed on behalf of purchasers of the securities of MetLife, Inc. between February 27, 2013 and January 29, 2018, both dates inclusive (“Class Period”). The lawsuit seeks to recover damages for MetLife investors under the federal securities laws.
According to the securities lawsuit, during the Class Period, defendants made false and/or misleading statements and/or failed to disclose that: (1) MetLife’s practices and procedures used to estimate its reserves set aside for annuity and pension payments were inadequate; (2) MetLife had inadequate internal controls over financial reporting; and (3) as a result, defendants’ statements about MetLife’s business, operations and prospects were materially false and misleading and/or lacked a reasonable basis at all relevant times. When the truth emerged and entered the market, the class action lawsuit alleges that MetLife investors suffered damages.
MetLife’s Press Release: “MetLife Preannounces Preliminary Fourth Quarter 2017 Earnings, Reschedules Earnings Release and Conference Call”
MetLife’s aforementioned announcement regarding its delayed earnings release was contained in a press release which stated, in pertinent part, that
[o]n its Dec. 15, 2017, Investor Outlook Call, MetLife announced that it was undertaking a review of practices and procedures used to estimate its reserves related to certain Retirement and Income Solutions group annuitants who have been unresponsive or missing over time.
Management of the company has determined the prior release of group annuity reserves resulted from a material weakness in internal control over financial reporting. MetLife expects to increase reserves in total between $525 million and $575 million pre-tax, to adjust for reserves previously released, as well as accrued interest and other related liabilities. The amount of the reserve increase is based in substantial part on actuarial, legal, statistical, and other assumptions. If actual facts and factors differ from those the company has assumed, the reserve the company has established could be adversely or positively affected.
The total amount expected to impact fourth quarter 2017 net income is between $135 million and $165 million pre-tax, the majority of which represents a current period strengthening of reserves and will be reflected in Adjusted Earnings (formerly known as Operating Earnings). [MetLife] expect[s] the full year 2017 net income impact to be between $165 million and $195 million pre-tax. In addition, the company intends to make prior period revisions to reflect the balance of these adjustments in the appropriate historical periods. The company also expects to correct historical periods for unrelated errors in those periods, as required by accounting standards. Those errors were previously recorded in the periods in which the company identified them.
. . .
In connection with MetLife’s review and enhancement of the processes and procedures relating to its Retirement and Income Solutions business in the United States, MetLife is currently reviewing its processes and procedures for identifying unresponsive and missing international group annuity annuitants and pension beneficiaries. In addition, MetLife recently initiated an ongoing global review of its processes and procedures for identifying unresponsive and missing policyholders and beneficiaries for the other insurance and annuity products it offers. MetLife is not currently aware of any material deficiencies in its identification of unresponsive or missing annuitants, policyholders or beneficiaries with respect to such products under review.
MetLife had previously informed its primary state regulator, the New York Department of Financial Services, about this matter and is responding to questions from them and other state regulators. The U.S. Securities and Exchange Commission enforcement staff has also made an inquiry regarding this matter and MetLife is responding to its questions. To date, MetLife is not aware of any intentional wrongdoing in connection with this matter.
MetLife Investors Who Purchased, or Otherwise Acquired, MetLife Securities
MetLife investors who purchased, or otherwise acquired, publicly-traded MetLife securities between February 27, 2013 and January 29, 2018, both dates inclusive, who have questions or concerns about Kehoe Law Firm’s investigation or their potential legal rights are encouraged to contact John Kehoe, Esq., (215) 792-6676, Ext. 801, [email protected], complete the form above on the right or e-mail [email protected] for additional information.