BSF partners Philip Korologos and Richard Drubel, representing Bruce Sherman, have filed a securities fraud case against Bear Stearns, certain of its executives, and Bear Stearns’ auditor, Deloitte & Touche. Sherman is the former CEO of asset manager Private Capital Management, which had investment control over almost 6% of Bear Stearns stock. Sherman alleges that defendants repeatedly misrepresented Bear Stearns’ true financial condition, including the value of its assets and the adequacy of its liquidity and capital reserves, both through their public statements and in repeated, direct conversations with Sherman.
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