UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YOR K
RENATO AMIO, Individually and On Behalf of All
Others Similarly Situated, CIVIL ACTION NO .
vs . CLASS ACTION COMPLAINT
LAZARD LTD ., BRUCE WASSERSTEIN,
STEVEN J. GOLUB, CHARLES G . WARD III,
WILLIAM M . LEWIS, MICHAEL J . JURY TRIAL DEMANDED
CASTELLANO AND GOLDMAN SACHS & CO .,
Plaintiff, Renato Amio, ("Plaintiff') alleges the following based upon the investigation o f
Plaintiff's counsel, which included, among other things, a review of the defendants' publi c
documents, conference calls and announcements made by defendants, United States Securities an d
Exchange Commission ("SEC") filings, wire and press releases published by and regarding Lazard
Ltd . ("Lazard" or the "Company") securities analysts ' reports and advisories about the Company,
and information readily obtainable on the Internet .
NATURE OF THE ACTION
1 . This is a federal securities class action on behalf of a class consisting of all persons
other than defend ants who purchased the publicly-traded secu rities of Lazard (the "Class") pursuan t
and/or traceable to the Company's false and misleading Registration Statement/Prospectus issued
in connection with the initial public offering of Lazard's shares ("IPO"), together with those wh o
purchased their shares on the open market between May 4, 2005 through May 12, 2005, seeking t o
pursue remedies under the Securities Act of 1933 (the "Securities Act") and the Securities Exchang e
Act of 1934 (the "Exchange Act" .)
2. Lazard, through its subsidiaries , operates as a financial advisory and asset
management firm . It offers an array of financial advisory services regarding mergers an d
acquisitions, restructurings, and various other corporate finance matters for corporate, partnership ,
institutional, government, and individual clients .
3. The complaint alleges that defendants' Class Period representations regarding Lazard
were materially false and misleading when made for the following reasons : (1) that Goldman Sachs ,
in order to create the illusion of demand for Lazard's shares, arranged to sell millions of shares t o
hedge funds that immediately flipped the shares back to Goldman, which already received a
substantial underwriting fee ; (2) that a market for an IPO priced at $25 did not exist ; (3) that Lazard's
Registration Stament/Prospectus did not comply with S-K Item 505 ;(4) that the IPO price wa s
inflated so Bruce Wasserstein could fund the acquisition of David-Weill's stake in the Compan y
solely with the proceeds of the IPO ; and (5) that the Company failed to disclose that Gerard o
Braggiotti, the Compay's deputy Chairman in Europe, a major contributor of new business for th e
Company, was likely to leave and/or cause turmoil within the organization as he opposed the IP O
and the purchase of David- Weill's shares .
4. On May 9, 2405, Barron 's published an article entitled "King's Ransom For Lazard . "
The article stated that there a "numerous negatives associated with the Lazard deal ." According to
author Andrew Bary (`Bar}'), Lazard' s shares were overvalued due to the Company's negative book
value and junk-grade bond ratings from two major credit-rating agencies . Additionally, Bary
criticized Lazard for having a high cost structure and a "a bevy of marginally productive investment
5. ByMay 12, 2005, the price of Lazard dipped below $22 per share, the price originall y
championed by bankers because of the weak demand .
JURISDICTION AND VENUE
6. The claims asse rted herein arise under and pursuant to Sections 10(b), and 20(a) of
the Exchange Act, (15 U .S .C . §§ 78j( b) and 78t(a)), and Rule IOb-5 promulgated thereunder (1 7
C.F.R . §240 .1 Ob-5) . Additionally, this action arises under Sections 11 and 15 of the Securities Ac t
(15 U .S .C . §§ 77k and 77(o)) and common law .
7 . This Court has jurisdiction over the subject matter of this action pursu ant to §27 of
the Exchange Act (15 U . S .C. §78aa), Section 22 (a) of the Securities Act (15 U .S.C. § 77v( a)), and
28 U.S.C. § 1331 .
8. Venue is proper in this Judicial District pursuant to §27 of the Exchange Act,1 5
U.S.C. § 78aa, Section 22 (a) of the Securities Act, 15 U.S .C . § 77v(a), and 28 U .S .C. § 1391(b) .
Many of the acts and transactions alleged herein , including the preparation and dissemination o f
materially false and misleading information, occurred in substantial part in this District .
Additionally, the Company maintains its principal executive offices in this Judicial District .
9 . In connection with the acts, conduct and other wrongs alleged in this complaint ,
defendants, directly or indirectly, used the means and instrumentalities of interstate commerce,
including but not limited to, the United States mails, interstate telephone communications and th e
facilities of the national securities exchange .
10 . Plaintiff, Renato Amio, as set forth in the accompanying certification, incorporate d
by reference herein, purchased Lazard' s securi ties at artificially inflated prices pursuant and/o r
traceable to the Company's initial public offering, which took place on or about May 5, 2005 (the
"IPO"), or about May 4, 2005 through May 12, 2005, seeking to pursue remedies under the Securities
Act of 1933 (the "Securities Act") .
11 . Defendant Lazard is a Bermuda corporation with its New York offices located at 3 0
Rockefeller Plaza, New York, New York 10020 .
12 . Defendant Goldman Sachs & Co . ("Goldman") is a global investment banking and
securities firm and also provides asset management and securities services . Goldman maintains its
principal place of business in New York City .
13 . Defendant Bruce Wasserstein ("Wasserstein") was, at all relevant times, th e
Company's Chairman and Chief Executive Officer.
14 . Defendant Steven J . Golub ("Golub") was, at all relev ant times , the Company's Vic e
Chairman and Chairman of our Financial Advisory Group .
15. Defendant Charles G . Ward III ("Ward") was, at all relevant times, the Company' s
President and Chairman of the Asset Management Group .
16 . Defendant William M . Lewis ("Lewis") was, at all relevant times, the Company's Co-
Chairman of Investment Banking .
IT Defendant Michael J . Castellano ("Castellano") was, at all relevant times, the
Company's Chief Financial Officer.
18 . Defendants Wasserstein, Golub, Ward, Lewis, and Castellano are collectivelyreferre d
to hereinafter as the "Individual Defendants ." During the Class Period, each of the Individual
Defendants, as senior executive officers and/or directors of Lazard were privy to non-publi c
information concerning its business, finances, products, markets and present and future busines s
prospects via access to internal corporate documents, conversations and connections with othe r
corporate officers and employees, attendance at management and Board of Directors meetings an d
committees thereof and via reports and other information provided to them in connection therewith .
Because of their possession of such information, the Individual Defendants knew or recklessl y
disregarded the fact that adverse facts specified herein had not been disclosed to, and were bein g
concealed from, the investing public .
19 . Because of the Individual Defendants' positions with the Company, they had access
to the adverse undisclosed information about the Company's business, operations, operational trends ,
financial statements, markets and present and future business prospects via access to interna l
corporate documents (including the Company's operating plans, budgets and forecasts and report s
of actual operations compared thereto), conversations and connections with other corporate officer s
and employees, attendance at management and Board of Directors meetings and committees thereo f
and via reports and other information provided to them in connection therewith .
20. It is appropriate to treat the Individual Defendants as a group for pleading purpose s
and to presume that the false, misleading and incomplete information conveyed in the Company' s
public filings, press releases and other publications as alleged herein are the collective actions of th e
narrowly defined group of defendants identified above . Each of the above officers of Lazard, b y
virtue of their high-level positions with the Company, directly participated in the management of th e
Company, was directly involved in the day-to-day operations of the Company at the highest level s
and was privy to confidential proprietary information concerning the Company and its business ,
operations, growth, financial statements, and financial condition, as alleged herein . Said defendant s
were involved in drafting, producing, reviewing and/or disseminating the false and misleadin g
statements and information alleged herein, were aware, or recklessly disregarded, that the false an d
misleading statements were being issued regarding the Company, and approved or ratified thes e
statements , in violation of the federal securities laws .
21 . As officers and controlling persons ofa publicly-held company whose securities were
and are registered with the SEC pursuant to the Exchange Act, and were traded on the New York
Stock Exchange ("NYSE") an d gove rned by the provisions of the feder al securities laws, the
Individual Defendants each had a duty to disseminate accurate and truthful information promptl y
with respect to the Company's financial condition and performance, growth, operations, financia l
statements, business, markets, management, earnings and present and future business prospects, an d
to correct any previously- issued statements that had become materially misleading or untrue , so that
the market price of the Company's publicly-traded securities would be based upon truthful an d
accurate information . The Individual Defendants' misrepresentations and omissions during the Clas s
Period violated these specific requirements and obligations .
22 . The Individual Defendants participated in the drafting, preparation, and/or approva l
of the various public and shareholder and investor reports and other communications complaine d
of herein . They were aware of, or recklessly disregarded, the misstatements contained therein an d
omissions therefrom, and were aware of their materially false and misleading nature . Because of
their Board membership and/or executive and managerial positions with Lazard's, each of th e
Individual Defendants had access to the adverse undisclosed information about Lazard financia l
condition and performance as particularized herein and knew (or recklessly disregarded) that thes e
adverse facts rendered the positive representations made by or about Lazard and its business issue d
or adopted by the Company materially false and misleading.
23 . The Individual Defendants, because of their positions of control and authority a s
officers and/or directors of the Company, were able to and did control the content of the various SE C
filings, press releases and other public statements pert aining to the Company during the Class Period .
Each Individual Defendant was provided with copies of the documents alleged herein to b e
misleading prior to or shortly after their issuance and/or had the ability and/or opportunity to prevent
their issuance or cause them to be corrected . Accordingly, each of the Individual Defendants i s
responsible for the accuracy of the public reports and releases detailed herein and is therefor e
primarily liable for the representations contained therein.
24 . Each of the defendants is liable as a participant in a fraudulent scheme and course o f
business that operated as a fraud or deceit on purchasers of Lazard's securities by disseminatin g
materially false and misleading statements and/or concealing material adverse facts . The schem e
(i) deceived the investing public regarding Lazard' s business, operations , management and th e
intrinsic value of Lazard securities ; and (ii) caused Plaintiff and other members of the Class t o
purchase Lazard securities at artificially inflated prices .
PLAINTIFF'S CLASS ACTION ALLEGATIONS
25 . Plaintiff brings this action as a class action pursuant to Federal Rule of Civi l
Procedure 23(a) and (b)(3) on behalf of a Class, consisting of all persons purchased the commo n
shares of Lazard pursuant and/or traceable to the Company's IPO or together with those wh o
purchased their shares in the open market between May 4, 2005 through May 12, 2005, inclusive .
Excluded from the Class are defendants, the officers and directors of the Company, at all relevan t
times, members of their immediate families and their legal representatives, heirs, successors o r
assigns and any entity in which defendants have or had a controlling interest .
26 . The members of the Class are so numerous that joinder of all members is imprac-
ticable. Throughout the Class Pe riod , Lazard' s common stock were actively traded on the NYSE .
While the exact number of Class members is unknown to Plaintiff at this time and can only b e
ascertained through appropriate discovery, Plaintiff believes that there are hundreds or thousands o f
members in the proposed Class . Record owners and other members of the Class maybe identified
from records maintained by Lazard or its transfer agent and may be notified of the pendency of thi s
action by mail, using the form of notice similar to that customarily used in securities cl ass actions .
27. Plaintiff' s claims are typical of the claims of the members of the Class, as all
members of the Class are similarly affected by defendants' wrongful conduct in violation of federal
law that is complained of herein.
28 . Plaintiff will fairly and adequately protect the interests of the members of the Clas s
and has retained counsel competent and experienced in class and securities litigation .
29 . Common questions of law and fact exist as to all members of the Class an d
predominate over any questions solely affecting individual members of the Class . Among th e
questions of law and fact common to the Class are :
(a) whether the federal securities laws were violated by defendants' acts as alleged
(b) whether statements made by defendants to the investing public during the Clas s
Period misrepresented material facts about the business, operations and management of Lazard ; and
(c) to what extent the members of the Class have sustained damages and the proper
measure of damages .
30. A class action is superior to all other available methods for the fair and efficien t
adjudication of this controversy since joinder of all members is impracticable . Furthermore, as the
damages suffered by individual Class members may be relatively small, the expense and burden o f
individual litigation make it impossible for members of the Class to individually redress the wrong s
done to them . There will be no difficulty in the management of this action as a class action .
SUBSTANTIVE ALLEGATION S
31 . Lazard through its subsidiaries, operates as a financial advisory and as set management
firm. It offers an array of financial advisory services regarding mergers and acquisitions ,
restructurings, and various other corporate finance matters for corporate, partnership, institutional ,
government, and individual clients .
32 . On or about May 4, 2005, Lazard filed with the SEC a Form S-1/A Registratio n
Statement (the "Registration Statement ") for the IPO .
33 . On May 6, 2005, Lazard filed its Form 424B3, which incorporated by reference th e
Company's registration statement (collectively the "Registration Statement/Prospectus .")In addition
to offering these shares of common stock, Lazard concurrently offered pursuant to a separate
prospectus $287 .5 million of equity security units . Lazard LLC also offered $550 million in principal
amount of senior, unsecured notes concurrently in a private placement . With respect to the pricing
of the offering, the Registration Statement/Prospectus, in relevant part, stated :
Prior to this offering, there has been no public market for the shares
of our common stock . The initial public offering price has been
negotiated between us and the representative . Among the factors
considered in determining the initial public offering price of the
shares, in addition to prevailing market conditions, were our historical
performance, estimates of our business potential and earnings
prospects, an assessment of our and LAZ-MD Holdings' management
and the consideration of the above factors in relation to market
valuation of companies in related businesses .
34 . Moreover, the Company discussed, in the Registration Statement/Prospectus, th e
following risks with respect to its business :
Our ability to retain our managing directors and other key
professional employees is critical to the success of our business,
including maintaining compensation levels at an appropriate level of
costs, and failure to do so may materially adversely affect our results
of operations and financial position .
Our people are our most important resource . We must retain the
services of our managing directors and other key professional
employees, and strategically recruit and hire new talented employees,
to obtain and successfully execute the advisory and as set management
engagements that generate substantially all our revenue .
Lazard Group has experienced several significant events in recent
years, including our unification under one global firm, the transition
to new senior management and our pending transformation from a
private to a public company, and our industry in general continues to
experience change and competitive pressures for retaining top talent,
each of which makes it more difficult for us to retain professionals .
If any of our managing directors and other key professional
employees were to join an existing competitor or form a competing
company or otherwise leave us, some of our clients could choose to
use the services of that competitor or some other competitor instead
of our services . The employment arrangements, non-competition
agreements and retention agreements we have entered into or intend
to enter into with our managing directors and other key professional
employees and restrictive covenants applicable to our LAM managing
directors may not prevent our managing directors and other key
professional employees from resigning from practice or competing
against us . See "Management-Arrangements with Our Managin g
Directors ." As part of our transformation to a public company, we
may face additional retention pressures as a result of reductions in
payments for services rendered by our managing directors . As a
result, we may not be able to retain these employees and, even if we
can, we may not be able to retain them at compensation levels that
will allow us to achieve our target ratio of compensation
expense-to-operating revenue. In addition, any such arrangements and
agreements will have a limited duration and will expire after a certain
period of time .
35. The statements referenced above in ¶¶ 33-34 were each materially false an d
misleading because they failed to disclose and misrepresented the following adverse facts, among
others : (1) that Goldman, in order to create the illusion of demand for Lazard's shares , arranged to
sell millions of shares to hedge funds that immediately flipped the shares back to Goldman, whic h
already received a substantial underwriting fee ; (2) that a market for an IPO priced at $25 did no t
exist; (3) that Lazard ' s Regis tration Stament/Prospectus did not comply with S-K Item 505 ;(4) that
the IPO price was inflated so defendant Wasserstein could fund the acquisition of David-Weill' s
stake in the Company solely with the proceeds of the IPO ; and (5) that the Company failed to
disclose that Gerardo Braggiotti, the Company's deputy Chairman in Europe, a major contributo r
of new business for the Company, was likely to leave and/or cause turmoil within the organizatio n
as he opposed the IPO and the purchase of David-Weill's shares .
The Truth Begins to Emerg e
36 . On May 9, 2005, Barron 's published an article entitled "King's Ransom For Lazard ."
The article stated that there were "numerous negatives associated with the Lazard deal ." According
to author Bary, Lazard' s shares were overvalued due to the Company' s negative book value and
junk-grade bond ratings from two major credit-rating agencies . Additionally, Bary criticized Lazar d
for having a high cost structure and a "a bevy of marginally productive investment bankers ."
37 . By May 12, 2005, the price of Lazard dipped below $22 per share, the price originally
championed by bankers because of the weak demand .
38 . On May 23, 2005, Goldman filed Form 4 with the SEC detailing that between May
5, 2005, and May 10, 2005, Goldman purchased 3,007,580 of Lazard's shares for between $22 .8 9
and $25 per share .
39 . On May 26, 2005, The New York Post published an article entitled "IPO Backlash-
Goldman Took $15M Bath on Lazard Offering ." The article revealed that "investors dumped th e
[Lazard] stock and forced Goldman to spend $15 million of its own cash to keep Lazard's stock from
tanking, according to SEC filings ."
40 . On May 29, 2005, The New York Times published an article entitled "Wasserstein' s
Latest Coup : Trumping Goldman Sachs ." The article in relevant part read:
DID Bruce Wasserstein, Lazard's chief executive, outmaneuver
It sure looks that way.
Last week, Goldman said in a filing that it was left with $ 15 million
in losses after underwriting Lazard's initial public offe ring and trying
in vain to prop up the stock as it beg an falling in the first days of
Indeed, the much-heralded public offering has turned out to be an
unmitigated fiasco -- for everybody but Mr . Wasserstein and Lazard .
Investors who originally bought into the offering at $25 a share have
quickly tallied up significant losses . The shares closed at $21 .78 on
Friday . Those investors have rightly turned around and accused
Goldman of hyping the offering and foolishly distributing shares to
a bevy of fast-money hedge funds that quickly flipped the stock,
virtually ensuring that the price would tumble .
And then, of course, there is Mr . Wasserstein . He is sitting pretty,
having pulled off his own Mission Impossible : By raising $854 .6
million in equity and nearly an additional $1 billion in debt, he and
Lazard's other bankers bought their freedom -- and control of the firm
-- from its chairman and patriarch, Michel David-Weill .
How did Mr . Wasserstein get it so right and Goldman, Wall Street's
favorite punching bag of late, get it so wrong? The offering is a case
study in what happens when bankers encourage both their corporate
clients and investors, a situation that doesn't help them make friends
Lazard's offering went off the rails long before it began trading on the
New York Stock Exchange under the symbol LAZ . Under pressure
from Lazard to get the highest possible price, Goldman set the
original range between $25 an d $27 a share . That was probably a bit
too high, and that mistake was compounded when the final price had
to be determined. Instead of lowering it to about $22 a share -- a price
point some bankers internally championed because of weak demand
-- Goldman decided to push for $25 a share, the minimum it had
promised to Lazard and the amount required to allow Mr . Wasserstein
to pay Mr . David-Weill .
While banks usually set the share price with input from their clients,
this client was different : Lazard is an investment bank that had it s
own views .
To meet Lazard's demands, Goldman sold many of the shares to
hedge funds with quick trigger fingers . That meant the moment the
stock began trading, thousands of shares flooded the market . Hoping
to blunt the selloff, Goldman stepped in, as underwriters often do, to
try to establish a floor for the stock by buying up the shares itself .
According to the filing, Goldman had already accumulated 3 .8
million shares, worth about $94 million, by the time stock dropped to
$24.90 . Goldman kept buying, at one point owning as much as 10
percent of Lazard, but it could not prevent the dam from bursting .
Unwilling to take on even more risk, Goldman could not continue
buying shares to stabilize the stock . But Goldman may not care so
much about its trading losses . It split $42 .7 million with six other
firms for underwriting Lazard's offering .
Goldman proudly defends its failed buying spree by saying that it was
going to bat for Lazard, but that is only half the story . Goldman was
also buying to protect itself. Investors who had held on to their share s
expecting them to go up -- as Goldman had led them to believe they
would -- were livid .
Either way , Goldman does not come out of this one looking too good .
If its explanation for buying the shares was really to help Lazard, that
is simply a bad consolation prize . One rival likened Goldman's
explanation to a doctor who botched a brain surgery but bragged
about his skill in stitching the patient back together . And if its
explanation was that it was trying to help the investors , it failed them
by pricing the stock too high in the first place .
Somewhere, Mr . Wasserstein is smiling .
FIRST CLAI M
Violation Of Section 11 Of The Securities Act Against
Promulgated Thereunder Against All Defendant s
41 . Plaintiff repeats and realleges each and every allegation contained above , excluding
all allegations above that contain facts necessaryto prove any elements not required to state a Sectio n
11 claim, including without limitation, scienter .
42 . This claim is brought by Plaintiff who obtained Lazard's stock pursuant to th e
Registration Statement on behalf of himself and other members of the Class . Each Class membe r
acquired their shares pursuant to or traceable to, and in reliance on, the Prospectus .
43 . Individual Defendants as signatories of the Registration Statement and the Prospectus ,
as a directors and/or officers of Lazard and controlling persons of the issuer, owed to the holders of
the stock obtained through the Prospectus the duty to make a reasonable and diligent investigation
of the statements contained in the Registration Statement and the Prospectus at the time they became
effective to ensure that such statements were true and correct and that there was no omission o f
material facts required to be stated in order to make the statements contained therein not misleading .
Defendants knew, or in the exercise of reasonable care should have known, of the materia l
misstatements and omissions contained in or omitted from the Registration Statement and th e
Prospectus as set forth herein . As such, defendants are liable to the Class .
44. None of the defendants made a reasonable investigation or possessed reasonabl e
grounds for the belief that the statements contained in the Registration Statement and the Prospectu s
were true or that there was no omission of material facts necessary to make the statements mad e
therein not misleading.
45 . Defendants issued and disseminated, caused to be issued and disseminated, an d
participated in the issuance and dissemination of, material misstatements to the investing publi c
which were contained in the Prospectus , which misrepresented or failed to disclose , inter alia, the
facts set forth above . By reason of the conduct herein alleged, each defendant violated and/o r
controlled a person who violated § 11 of the Securities Act .
46 . As a direct and proximate result of defendants' acts and omissions in violation of th e
Securities Act, the market price of Lazard's stock was artificially inflated and Plaintiff and the Clas s
suffered substantial damage in connection with their ownership of Lazard's common stock pursuan t
to the Registration Statement and the Prospectus/Proxy.
47 . Lazard is the issuer of the stock sold via the Registration Statement. As issuer of th e
stock, the Company is strictly liable to Plaintiff and the Class for the material misstatements and
omissions therein .
48 . At the times they obtained their shares of Lazard, the Plaintiff and members of th e
Class did so without knowledge of the facts concerning the misstatements or omissions allege d
49 . This action is brought within one year after discovery of the untrue statements an d
omissions in and from the Prospectus/Proxy should have been made through the exercise o f
reasonable diligence, and within three years of the effective date of the Prospectus .
50 . By virtue of the foregoing, plaintiff and the other members of the class are entitle d
to damages under Section I 1 as measured by the provisions of Section 11(e), from the defendant s
and each of them, jointly and severally .
Violations of Section 12(a)(2) of the Securities Act
Against All Defendants
51 . Plaintiff repeats and realleges each and every allegation contained above .
52 . This Count is brought pursuant to Section 12(a)(2) of the Securities Act on behalf of
the Class, against all defendants .
53 . Defendants were sellers and offerors and/or solicitors of purchasers of the share s
offered pursuant to the Prospectus .
54 . The Prospectus contained untrue statements of material facts, omitted to state othe r
facts necessary to make the statements made not misleading, and concealed and failed to disclos e
material facts . The Individual Defendants' actions of solicitation included participating in th e
preparation of the false and misleading Prospectus .
55 . Defendants owed to the purchasers of Lazard Securities, including plaintiff and othe r
class members, the duty to make a reasonable and diligent investigation of the statements containe d
in the IPO materials, including the Prospectus contained therein, to ensure that such statements wer e
true and that there was no omission to state a material fact required to be stated in order to make th e
statements contained therein not misleading . Defendants knew of, or in the exercise of reasonabl e
care should have known of, the misstatements and omissions contained in the IPO materials as set
fort h above .
56 . Plaintiff and other members of the Class purchased or otherwise acquired Lazar d
Securities pursuant to and/or traceable to the defective Prospectus . Plaintiff did not know, or in the
exercise of reasonable diligence could not have known, of the untruths and omissions contained in
the Prospectus .
57 . Plaintiff, individually and representatively, hereby offers to tender to defendants thos e
securities which plaintiff and other Class members continue to own , on behalf of all members of the
Class who continue to own such securities , in return for the consideration paid for those securitie s
together with interest thereon . Class members who have sold their Lazard Secu rities are entitled to
58 . By reason of the conduct alleged herein, these defendants violated, and/or controlle d
a person who violated , § 12(a)(2) of the Securities Act. Accordingly, Plaintiff and members of the
Class who hold Lazard Securities purch ased in the IPO have the right to rescind and recover th e
consideration paid for their Lazard securities and hereby elect to rescind and tender their Lazard
securities to the defendants sued herein . Plaintiff and Class members who have sold their Lazard
securities are entitled to rescissory damages.
THIRD CLAI M
Violation of Section 15 of The Securities Act
Against Individual Defendants
59 . Plaintiff repeats and realleges each and every allegation contained above, excludin g
all allegations above that contain facts necessary to prove any elements not required to state a Section
15 claim, including without limitation, scienter.
60. This count is asserted against Individual Defendants and is based upon Section 15 o f
the Securities Act .
61 . Individual Defendants, by virtue of their offices, directorship and specific acts were,
at the time of the wrongs alleged herein and as set forth herein, a controlling person of Lazard within
the meaning of Section 15 of the Securities Act . Individual Defendants had the power and influenc e
and exercised the same to cause Lazard to engage in the acts described herein .
62. Individual Defendant's position made them privy to and provided them with actua l
knowledge of the material facts concealed from Plaintiff and the Class .
63. By virtue of the conduct alleged herein, Individual Defendants are liable for th e
aforesaid wrongful conduct and are liable to plaintiffs and the Class for damages suffered .
Violation Of Section 10(b) O f
The Exchange Act Against And Rule 10b-5
Promulg ated Thereunder Against All Defendants
64. Plaintiff repeats and realleges each and every allegation contained above as if full y
set forth herein .
65 . During the Class Period, defendants carried out a plan, scheme and course of conduc t
which was intended to and, throughout the Class Period, did: (i) deceive the investing public ,
including Plaintiff and other Class members, as alleged herein ; and (ii) cause Plaintiff and other
members of the Class to purchase Lazard securities at artificially inflated prices . In furtherance o f
this unlawful scheme, plan and course of conduct, defendants, and each of them, took the actions se t
forth herein .
66. Defendants (a) employed devices, schemes, and artifices to defraud ; (b) made untru e
statements of material fact and/or omitted to state material facts necessary to make the statement s
not misleading ; and (c) engaged in acts, practices, and a course of business which operated as a frau d
and deceit upon the purchasers of the Company's securities in an effort to maintain artificially hig h
market prices for Lazard securities in violation of Section 10(b) of the Exchange Act and Rule I Ob-5 .
All defendants are sued either as primary participants in the wrongful and illegal conduct charge d
herein or as controlling persons as alleged below .
67 . Defendants, individually and in concert, directly and indirectly, by the use, means o r
instrumentalities of interstate commerce and/or of the mails, engaged and participated in a
continuous course of conduct to conceal adverse material information about the business, operation s
and future prospects of Lazard as specified herein.
68 . These defendants employed devices, schemes, and artifices to defraud, while i n
possession of material adverse non-public information and engaged in acts, practices, and a cours e
of conduct as alleged herein in an effort to assure investors of Lazard value and performance an d
continued substantial growth, which included the making of, or the participation in the making of,
untrue statements of material facts and omitting to state material facts necessary in order to make the
statements made about Lazard and its business operations and future prospects in the light of the
circumstances under which they were made, not misleading, as set forth more particularly herein,
and engaged in transactions, practices and a course of business which operated as a fraud and deceit
upon the purchasers of Lazard securities during the Class Period .
69 . Each of the Individual Defendants' primary liability, and controlling person liability,
arises from the following facts : (i) the Individual Defendants were high-level executives and/o r
directors at the Company during the Class Period and members of the Company's management team
or had control thereof, (ii) each of these defendants, by virtue of his responsibilities and activities
as a senior officer and/or director of the Company was privy to and participated in the creation,
development and reporting of the Company's internal budgets, plans, projections and/or reports ;
(iii) each of these defendants enjoyed significant personal contact and familiarity with the other
defendants and was advised of and had access to other members of the Company's management
team, internal reports and other data and information about the Company's finances, operations, and
sales at all relevant times ; and (iv) each of these defendants was aware of the Company's
dissemination of information to the investing public which they knew or recklessly disregarded was
materially false and misleading .
70. The defendants had actual knowledge of the misrepresentations and omissions of
material facts set forth herein, or acted with reckless disregard for the truth in that they failed to
ascertain and to disclose such facts, even though such facts were available to them . Such defendants '
material misrepresentations and/or omissions were done knowingly or recklessly and for the purpose
and effect of concealing Lazard operating condition and future business prospects from the investing
public and supporting the artificially inflated price of its securities . As demonstrated by defendants'
overstatements and misstatements of the Company's business, operations and earnings throughout
the Class Period, defendants, if they did not have actual knowledge of the misrepresentations and
omissions alleged, were reckless in failing to obtain such knowledge by deliberately refraining from
taking those steps necessary to discover whether those statements were false or misleading .
71 . As a result of the dissemination of the materially false and misleading information
and failure to disclose material facts, as set forth above, the market price of Lazard securities was
artificially inflated during the Class Period. In ignorance of the fact that market prices of Lazar d
publicly-traded securities were artificially inflated, and relying directly or indirectly on the false an d
misleading statements made by defendants, or upon the integrity of the market in which the securitie s
trades, and/or on the absence of material adverse information that was known to or recklessl y
disregarded by defendants but not disclosed in public statements by defendants during the Clas s
Period, Plaintiff and the other members of the Class acquired Lazard securities during the Class
Period at artificially high prices and were damaged thereby .
72 . At the time of said misrepresentations and omissions , Plaintiff and other members
of the Class were ignorant of their falsity, and believed them to be true . Had Plaintiff and the other
members of the Class and the marketplace known the truth regarding the problems that Lazard wa s
experiencing, which were not disclosed by defendants, Plaintiff and other members of the Clas s
would not have purchased or otherwise acquired their Lazard securities, or, if they had acquired suc h
securities during the Class Period, they would not have done so at the artificially inflated prices
which they paid .
73 . By virtue of the foregoing, defendants have violated Section 10(b) of the Exchange
Act, and Rule 1 Ob-5 promulgated thereunder .
74 . As a direct and proximate result of defendants' wrongful conduct, Plaintiff and th e
other members ofthe Class suffered damages in connection with their respective purchases and sale s
of the Company' s securities during the Class Period .
Violation Of Section 20(a) O f
The Exchange Act Against the Individual Defendant s
75. Plaintiff repeats and realleges each and every allegation contained above as if fully
set forth herein .
76 . The Individual Defendants acted as controlling persons of Lazard within the meaning
of Section 20(a) of the Exchange Act as alleged herein . By virtue of their high-level positions, and
their ownership and contractual rights, participation in and/or awareness of the Company' s
operations and/or intimate knowledge of the false financial statements filed by the Company with
the SEC and disseminated to the investing public, the Individual Defendants had the power t o
influence and control and did influence and control, directly or indirectly, the decision-making of
the Company, including the content and dissemination of the va rious statements which Plaintiff
contend are false and misleading . The Individual Defendants were provided with or had unlimite d
access to copies of the Company's reports, press releases, public filings and other statements allege d
by Plaintiff to be misleading prior to and/or shortly after these statements were issued and had the
ability to prevent the issu ance of the statements or cause the statements to be corrected .
77. In particular, each of these defendants had direct and supervisory involvement in th e
day-to-day operations of the Company and, therefore, is presumed to have had the power to contro l
or influence the particular transactions giving rise to the securities violations as alleged herein, an d
exercised the same .
78 . As set forth above, Lazard and the Individual Defendants each violated Section 10(b )
and Rule 1 Ob-5 by their acts and omissions as alleged in this Complaint . By virtue of their position s
as controlling persons, the Individual Defendants are liable pursuant to Section 20(a) of th e
Exchange Act . As a direct and proximate result of defendants' wrongful conduct, Plaintiff and other
members of the Class suffered damages in connection with their purchases of the Company' s
securities during the Class Period.
WHEREFORE , Plaintiff prays for relief and judgment, as follows :
(a) Determining that this action is a proper class action, designating Plaintiff as Lea d
Plaintiff and certifying Plaintiff as a class representative under Rule 23 of the Federal Rules of Civi l
Procedure and Plaintiffs counsel as Lead Counsel ;
(b) Awarding compensatory damages in favor of Plaintiff and the other Clas s
members against all defendants, jointly and severally, for all damages sustained as a result o f
defendants' wrongdoing, in an amount to be proven at trial, including interest thereon ;
(c) Awarding Plaintiff and the Class their reasonable costs and expenses incurred i n
this action, including counsel fees and expert fees ; and
(d) Such other and further relief as the Court may deem just and proper .
JURY TRIAL DEMANDE D
Plaintiff hereby demands a trial by jury.
BRODSKY & SMITH, LLC
Evan J . Smith, Esquire
240 Mineola Boulevard
Mineola, NY 11501
(516) 741-497 7
SCHIFFRIN & BARROWAY, LLP
Marc A . Topaz
Richard A. Maniskas
280 King of Prussia Road
Radnor, PA 19087
Telephone : (610) 667-770 6
Attorneys for Plaintif