Investor Alert: Class Action Lawsuit Filed Against Ready Capital Corporation Under Scrutiny

On March 9, 2025, Robbins LLP notified shareholders about a class action lawsuit initiated on behalf of those who purchased or acquired shares of Ready Capital Corporation (NYSE: RC) between November 7, 2024, and March 2, 2025. Ready Capital is a real estate finance firm involved in originating, acquiring, financing, and servicing lower-to-middle-market commercial real estate (CRE) loans, along with small business loans and residential mortgages.

The Allegations

The lawsuit addresses serious allegations against Ready Capital and asserts that the company misled its investors about the viability of certain loans within its portfolio. The complaint highlights several key points:

1. The company did not disclose that a significant portion of its non-performing loans in the CRE sector were unlikely to yield repayments.
2. To “stabilize” its CRE portfolio, Ready Capital allegedly made the decision to fully reserve these problem loans without accurately disclosing this measure in its financial statements.
3. As a result, the misrepresentation negatively impacted the perceived financial health of the firm, leading to substantial losses.

The class action comes in light of Ready Capital’s announcement on March 3, 2025, regarding its fourth-quarter and annual financial results for 2024. The disclosures included a shocking reported net loss of $1.80 per share for the fourth quarter and an overall annual loss of $2.52 per share for the full year. The company attributed these significant losses to its struggles with non-performing loans in its CRE portfolio, stating that decisive steps were necessary to stabilize the balance sheet. Following this announcement, Ready Capital's stock plummeted by $1.86 — a staggering 26.8% drop — closing at $5.07 per share on the day of the announcement.

Implications for Shareholders

Shareholders of Ready Capital may have grounds to participate in the ongoing class action case. Those interested in potentially serving as lead plaintiffs are encouraged to file their necessary documentation with the court by May 5, 2025. Lead plaintiffs are crucial as they represent the class in guiding the litigation process. However, it’s important to note that participation is not mandatory for recovery; shareholders who do not wish to engage actively can still remain part of the class action.

Robbins LLP operates on a contingency fee basis, ensuring that shareholders incur no fees or costs unless they recover losses through a successful outcome.

About Robbins LLP

Robbins LLP has solidified its reputation as a leader in shareholder rights litigation since its inception in 2002. The firm is dedicated to aiding shareholders in retrieving losses, improving corporate governance, and holding company executives accountable for their misconduct.

For shareholders who wish to stay informed about the developments in the lawsuit against Ready Capital Corporation, or for any updates regarding corporate executives' wrongdoings, they can opt into Stock Watch alerts.

This lawsuit underscores the importance of transparency and accountability in corporate governance, particularly in the finance industry, where misinformation can lead to significant investor losses. As this case unfolds, it will be essential for affected shareholders to remain vigilant and informed.