stock filing bankruptcy

Linda on

I am neither a lawyer nor a stockbroker so my opinion is not binding (lol). Simply stated, most of those types of lawsuits apply to the dates of purchase, so if you purchased the stock after a certain date and sold it at a loss after the issue arose (misstated earnings, fraud, etc.), you would still be entitled to any settlement. That being said, the lawyers make a lot of money from those suits, but the shareholders get little to no benefit, so I would not worry about it. Sell the stock if you can, even for just $1 and take the loss on the tax return.

Linda Wiltse

Pointe Players

From: club_cafe@bivio.com [mailto:club_cafe@bivio.com] On Behalf Of Mike Jones via bivio.com
Sent: Thursday, November 06, 2014 12:23 PM
To: club_cafe@bivio.com
Subject: Re: [club_cafe] stock filing bankrupsy

Would selling these nearly worthless shares preclude claiming any benefit that may result from the lawsuit? Or would having owned the shares secure your rights?

Mike Jones

Wall$treet Wannabees

From: Laurie Frederiksen <laurie@bivio.biz>
To: The Club Cafe <club_cafe@bivio.com>
Sent: Thursday, November 6, 2014 7:45 AM
Subject: Re: [club_cafe] stock filing bankrupsy

Hi,

When a company files for bankruptcy, its shares are typically delisted from the major exchanges as it moves through the bankruptcy reorganization process. They are not worthless, but they may not be worth much.

Many companies eventually cancel their outstanding stock when the bankruptcy is finalized. That is the point when the shares become worthless and you can write them off, but this can take several years.

Until then, you'd own a stock with little value that would make your club record keeping a bit harder because you'd have to update its price manually.

If you want to keep things simple, you'll probably want to have your broker sell the shares you have ASAP so you can remove them from your records.

Laurie Frederiksen
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On Thu, Nov 6, 2014 at 7:27 AM, <mmoriarty@crocker.com> wrote:

We received a notice that a stock we invested a small sum in has filed for bankrupsy. There is also a lawsuit filed against them for fraudulent representation of company finances. What steps should our club take?

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