Sonn Law Group is investigating claims related to notes issued by Swift Energy Co., Basic Energy Services, Inc., Alpha Natural Resources and RRI Energy. Financial advisors may have recommended these notes to retirees or other fixed income investors. The downturn in energy prices, however, has exposed these investors to considerable losses, particularly if such investors were over-concentrated in energy sector investments. For example, the national average price of gas will drop below $2 per gallon tomorrow for the first time since March 25, 2009, according to AAA. In addition, oil prices have dropped 65% since mid-2014 to less than $37 per barrel, according to CNN Money. Further, analysts at Goldman Sachs investment bank estimate $20 oil is possible in 2016. Another bearish factor for oil prices is the expected increase of crude oil exports from Iran after international sanctions.
- Alpha Natural Resources is based in Bristol, Virginia, and is a leading producer of coal. With coal prices declining, Alpha Natural Resources was overwhelmed by substantial debts accumulated to finance the purchase of coal mining assets. Alpha Natural Resources filed for Chapter 11 in bankruptcy court in Richmond, Va., with assets of $10.1 billion and liabilities of $7.1 billion, according to The Wall Street Journal.
- Swift Energy Company, founded in 1979 and headquartered in Houston, engages in developing, exploring, acquiring and operating oil and gas properties, with a focus on the Eagle Ford trend of South Texas and, to a lesser extent, the onshore and inland waters of Louisiana, according to its website.
- Basic Energy Services, based in Fort Worth, Texas, provides well site services to oil and natural gas drilling and producing companies in the United States, according to its website.
- RRI Energy Inc. (formerly Reliant Energy), based in Houston, Texas, is a wholesale electricity provider. In 2010, RRI Energy Inc. and Mirant Corp. combined to create GenOn, a new independent power provider, that owned approximately 24,700 megawatts of generation capacity in the Mid-Atlantic, California, the Northeast, the Southeast, and the Midwest.
A broker must have reasonable grounds for each recommendation made to investors considering such factors as the customer’s other securities holdings, financial situation, and risk tolerance. In addition, before a firm offers a security to its customers, the firm must conduct due diligence, that is investigate the facts surrounding the security, to confirm that it is suitable for any customer of the firm. The suitability of an investment for a particular individual is at the center of the investment process and one of the key fiduciary duties owed by a firm and its broker to the customer. A firm may be held liable for its failure to recommend suitable investments to its customers.
If you invested in Swift Energy Co., Basic Energy Services, Inc., Alpha Natural Resources and RRI Energy and have experienced investment losses, please call us at 844-689-5754 or complete our “contact form.” Sonn Law Group is a nationally recognized law firm representing individuals, trusts, corporations and institutions in claims against brokerage firms, banks and insurance companies.