Nancy Fineman Wins Homestore Verdict
A Los Angeles Federal jury awarded the California State Teachers’ Retirement System (CalSTRS) and other investors a multi-million dollar security fraud judgment against the former CEO of Homestore.com. The jury found Stuart H. Wolff, the former chief executive officer and chairman of the board of Homestore, liable for damages while heading the company. The jury found that the CEO was responsible for the actions of other senior executives who engaged in a fraudulent scheme where Homestore created a circular flow of money, known as “purchased revenues” in which money flowed from Homestore to outside firms and back to Homestore. After the fraud was uncovered, Homestore was forced to restate more than $120 million in revenue. The securities fraud case, one of the few brought to trial, was headed by Nancy Fineman, and with her was Daniel Sterrett. CalSTRS had previously settled with other Homestore executives and with the company’s auditor, PricewaterhouseCoopers. CalSTRS is the second largest pension fund in the U.S. CPM has represented CalSTRS for many years.