Securities

  • February 27, 2015

    Revolving-Door Roundup: Paul Weiss, DLA Piper, Cadwalader

    This month's roundup of attorney moves between the public and private spheres includes two U.S. attorneys landing partnerships at major firms — the second and third this year, for those keeping count — and a New York assistant U.S. attorney who secured a senior counsel position at Bill Ackman's private equity firm.

  • February 27, 2015

    SEC Settles With Japanese Banker In $2B Olympus Scandal

    The U.S. Securities and Exchange Commission said Friday it has reached a settlement with a Japanese broker alleged to have been involved in the $2 billion fraud scandal that hit camera and medical device maker Olympus Corp. in 2011 over exorbitant advisory fees paid on costly acquisitions, agreeing to drop the case in exchange for his withdrawal from the securities industry.

  • February 27, 2015

    SIFMA Tells 5th Circ. Repose Law Kills FDIC's $2B RMBS Suit

    The Securities Industry and Financial Markets Association on Wednesday asked the Fifth Circuit to find that the extender statute for certain Federal Deposit Insurance Corp. claims doesn’t preempt state statutes of repose, in a $2.1 billion residential mortgage-backed securities case targeting Goldman Sachs & Co. and several other banks.

  • February 27, 2015

    Venable Atty's Lapses In Bebo Suit Cost $5M, Suit Says

    The onetime owner of app maker Bebo has sued a Venable LLP partner and the firm in California court, accusing the Los Angeles attorney of taking a $50,000 retainer fee then failing to show up to court in a derivative shareholder suit that ultimately ended in a $5 million default judgment.

  • February 27, 2015

    BREAKING: Rennert Hit With $118M Verdict Over MagCorp Bankruptcy

    A New York federal jury found Ira Rennert liable on Friday for contributing to Magnesium Corp. of America’s 2001 bankruptcy, ordering the billionaire industrialist and his firm to pay $118 million in damages for taking shareholder dividends that allegedly left MagCorp too weak to survive.

  • February 27, 2015

    Best Buy Tells 8th Circ. Investor Class Must Go

    Best Buy Co. Inc. has urged the Eighth Circuit to overturn the certification of a class of investors in a stock-drop suit against the company, arguing the investors failed to show the company's alleged misrepresentations about its fiscal well-being impacted stock prices.

  • February 27, 2015

    Feds Nab 'Billionaire' In $2.5M Wire Fraud Ponzi Scheme

    Federal prosecutors said Thursday they nabbed a man they accuse of falsely pretending to be a billionaire with overseas accounts that swindled investors out of $2.5 million in a wire fraud Ponzi scheme, after reaching plea agreements with two of his alleged co-conspirators.

  • February 27, 2015

    Bankia Will Cap Compensation For IPO Bust At $350M

    Spanish lender Bankia SA said on Friday that it will cover up to €312 million ($349.2 million) of the estimated €780 million that will be paid back to retail investors who sued Bankia over its controversial and ill-fated initial public offering in 2011.

  • February 27, 2015

    SEC Sues Over $23.5M Wings Network Ponzi Scheme

    The U.S. Securities and Exchange Commission has sued the operators of Wings Network, an alleged $23.5 million Ponzi and pyramid scheme that preyed on Latino immigrants in the Boston area, according to a complaint unsealed Thursday.

  • February 26, 2015

    Wyly Brothers Ordered To Pay $299M To SEC In Fraud Case

    A New York federal judge on Thursday ordered former Michael’s Stores Inc. Chairman Sam Wyly and the estate of his late brother Charles Wyly Jr. to pay about $299.3 million to federal regulators for engaging in securities fraud, after the parties spent months battling over the amounts.

  • February 26, 2015

    Judge Unseals Warrant That Drove Chiasson's Arrest

    A New York federal judge has unsealed the 2010 search warrant that led to the arrest of Anthony Chiasson, whose subsequent insider-trading conviction was recently overturned by the Second Circuit.

  • February 26, 2015

    Bharara Sued Over Insider Trading Raid On Hedge Fund

    A co-founder of Level Global Investors LP sued Manhattan U.S. Attorney Preet Bharara in federal court Thursday, claiming that prosecutors falsely implicated him in an insider trading scheme to justify a fateful 2010 raid on the hedge fund.

  • February 26, 2015

    NY AG Whistleblower Plan May Make SEC Up Bounty Game

    New York's attorney general could end up giving the U.S. Securities and Exchange Commission a run for its whistleblower money if his plans for a fraud tips bounty program get off the ground and it forces the agency to compete harder for tipsters to come its way first.

  • February 26, 2015

    DOJ Grabs Headlines With $2.6B MBS Deal, But Little Else

    While the $2.6 billion settlement Morgan Stanley revealed Wednesday marks another big-dollar deal following the financial crisis, critics say that its strategy of going after big banks one by one will not have the necessary deterrent effect to stop the next calamity.

  • February 26, 2015

    St. Jude Medical Puts Up $50M To Settle Investor Suit

    St. Jude Medical Inc. reached a proposed $50 million settlement in an investor suit alleging the company artificially inflated its third-quarter 2009 earnings, with class counsel asking a Minnesota federal judge Thursday to approve the resolution.

  • February 26, 2015

    Mayer Brown Adds Ex-Morgan Lewis Atty To Securities Group

    Mayer Brown LLP has deepened its corporate bench by nabbing a mergers and acquisitions and private equity pro from Morgan Lewis & Bockius LLP, the firm announced Tuesday.

  • February 26, 2015

    3rd Circ. Keeps Carlyle Investor Battle In Delaware Court

    An investment fund controlled by a Dutch investor must pursue its breach of contract claims against Carlyle Investment Management LLC in Delaware state court even though the fund never signed the contract requiring the dispute to take place there, the Third Circuit ruled Wednesday.

  • February 26, 2015

    Ex-McGinn Smith Brokers Punished In $125M Scheme

    The U.S. Securities and Exchange Commission on Wednesday punished nine former McGinn Smith & Co. brokers in connection with an alleged $125 million investment scheme.

  • February 26, 2015

    CFTC Suit Claiming Atty Aided Investment Scam Can Proceed

    A Florida federal judge refused Tuesday to throw out a U.S. Commodity Futures Trading Commission lawsuit against Jay Bruce Grossman over his alleged role in facilitating a precious metals investment scam while representing Hunter Wise Commodities LLC and AmeriFirst Management LLC, saying the agency has appropriately pled its case.

  • February 26, 2015

    $400M Pfizer Class Action Settlement On Track For Approval

    A proposed $400 million deal to resolve a class action lawsuit accusing Pfizer Inc. of misleading investors about illegal off-label drug marketing was put on track for approval on Thursday, but not before a Manhattan federal judge asked pointed questions about the value of the deal and demanded a fresh round of opt-out notices for investors. 

Expert Analysis

  • 2 Delaware Cases May Slow Appraisal Arbitrage Momentum

    Mark D. Gerstein

    Two appraisal cases out of Delaware involving CKx Inc. and Ancestry.com mark an important judicial response to the recent spike in “appraisal arbitrage,” which may effectively subdue the rise of this practice. The scope of these decisions, however, should not be overstated, say attorneys with Latham & Watkins LLP.

  • Dropped Herbalife Insider Case Leaves Questions Unanswered

    Jonathan R. Tuttle

    The dismissal of a U.S. Securities and Exchange Commission action against Jordan Peixoto — alleged to have traded on material nonpublic information relating to Herbalife Ltd. — means that the validity of a novel insider trading theory and the use of administrative actions in these types of enforcement proceedings remains unsettled for now, say attorneys with Debevoise & Plimpton LLP.

  • Yates: A Welcome End To Prosecutorial 'Fishing' Expedition

    Diana Lloyd

    In this week's ruling in Yates v. U.S., the U.S. Supreme Court reinforced the principle that the language of a statute must be analyzed in an appropriate context and, more importantly, put a damper on prosecutors’ dangerous trend toward applying certain statutes to criminalize behavior beyond what one would reasonably understand to be prohibited, says Diana Lloyd of Choate Hall & Stewart LLP.

  • Lenity And Deference On A Collision Course

    Michael Y. Kieval

    It is clear that at least two U.S. Supreme Court justices are willing to address the issue of deference to the agency interpretation of criminal or hybrid statutes. It is less clear whether the court is interested in curbing the use of administrative adjudication to make law. Both of these trends carry particular importance for the financial services industry, say attorneys with Weiner Brodsky Kider PC.

  • Recent Lessons In Anti-Money Laundering Compliance

    Emily P. Gordy

    Chief compliance office liability continues to be one of the hottest topics in the regulatory community. Two recent enforcement actions against anti-money laundering compliance officers not only highlight the issue but also offer a number of lessons for any current or prospective AMLCO, say Emily Gordy and Renée Kramer of Shulman Rogers Gandal Pordy & Ecker PA.

  • Expect More Data Analytics, 'Hard Punches' From The SEC

    Keith Miller

    As indicated by top brass at the SEC Speaks conference, the U.S. Securities and Exchange Commission plans to be aggressive in bringing enforcement actions, from the investigation stage through litigation, and has set a high bar for those seeking leniency through cooperation credit. Practitioners can also expect more targeted, data-driven enforcement actions in the year to come, say attorneys with Perkins Coie LLP.

  • Emerging Trends In Corporate Sustainability Reporting

    Sara K. Orr

    Recently, a potential new legal trend has emerged in which plaintiffs are filing product liability and securities class actions against companies by invoking claims related to environmental, social and governance or sustainability statements. This development demonstrates the risks associated with issuing ESG statements as some consumers and investors will not hesitate to litigate their accuracy or materiality, say Sara Orr and Bar... (continued)

  • How Financial Firms Can Meet Cybersecurity Expectations

    Jorge Rey

    Now that both the Financial Industry Regulatory Authority and the U.S. Securities and Exchange Commission have released their cybersecurity reports, the agencies will likely take enforcement actions against firms that suffer data breaches. While there is no one-size-fits-all approach, FINRA’s report offers a comprehensive approach to cybersecurity that broker-dealers should consider, say Bao Nguyen and Jorge Rey of Kaufman Rossin PA.

  • Allergan Fuels Tension Over Schedule 13D Disclosure

    Jonathan R. Tuttle

    An unresolved question that was brought into sharper relief in the Allergan Inc. takeover battle is whether the 10-day initial filing requirement for Schedule 13D filings should be shortened. Although not necessarily implicated in this case, critiques of the current beneficial ownership regime have focused on the use of derivatives to sidestep the Schedule 13D reporting requirements, say attorneys with Debevoise & Plimpton LLP.

  • 2nd Circ. Lays Out New Rules For Restitution

    Harry Sandick

    The Second Circuit's recent ruling in U.S. v. Cuti seems to place a notable limitation on the ability of a victim of white collar crime to recover expenses incurred in the course of investigating and reporting the defendant’s criminal activity. This decision does not take into account how internal investigations are typically conducted when the allegations concern wrongdoing by senior management, say attorneys with Patterson Belkna... (continued)