In April of this year, The Wall Street Journal ran an unfavorable article about $349.2 million NovaStar Financial, claiming that the subprime mortgage lender had purportedly failed to comply with state licensing rules. The article led to a 30 percent stock-price dip, a class action suit, and an informal inquiry by the SEC—all in the course of one week. Like most companies in that situation, NovaStar immediately turned to a public relations firm for assistance.
Davis
