Wild Ride for Corinthian Shares

Shares in education company Corinthian Colleges(COCO Quote) fell quickly and furiously on rumors of a civil lawsuit against the company, two days after reports that a competitor was hit by an employee complaint alleging improper activity.

The company said: "It knows of no events or activities that would warrant any concern in the company's performance." In a statement, it added that "the extraordinary nature of this morning's trading and the subsequent trading halt warranted this assurance to shareholders."

At one point, Corinthian shares were down as much as 33% in trading, 10 times normal volume. The selloff was so swift and vicious that trading was halted and the Nasdaq also cancelled all trades of Corinthian shares between 10:46 a.m. and 10:58 a.m. EST. Recently, shares were down $2.29, or 4%, to $55.23.

Corinthian shares had already fallen 17% this week, following news Wednesday that an employee at postsecondary education rival Career Education(CECO Quote) filed a complaint alleging officials had forged signatures and tampered with student files in an effort to inflate enrollment and company profits.