• September 18, 2014

    Virtual Bank Founder Must Pay $40M For Bitcoin Ponzi Scheme

    A Texas federal judge on Thursday ordered Bitcoin Savings & Trust and its founder to pay more than $40 million in disgorgement and penalties, ruling that the U.S. Securities and Exchange Commission showed they defrauded investors by running a Ponzi scheme involving the bitcoin virtual currency.

  • September 18, 2014

    2nd Circ. Tosses Iraq’s Suit Over $10B Oil-For-Food Scheme

    The Second Circuit on Thursday upheld the dismissal of Iraq's $10 billion racketeering lawsuit accusing multinational companies of helping Saddam Hussein defraud the United Nations’ so-called Oil-for-Food program, finding the Hussein regime acted as a representative of the Middle Eastern nation, which could not sue itself.

  • September 17, 2014

    2nd Circ. Stays Goldman, Citi Win In FINRA Arbitration Bid

    The Second Circuit agreed Tuesday to hold off on issuing a mandate in two cases where it blocked arbitrations against Goldman Sachs & Co. and Citigroup Global Markets Inc. before the Financial Industry Regulatory Authority, allowing time for the public financing authorities that sought arbitration to appeal to the U.S. Supreme Court.

  • September 17, 2014

    AgFeed To Pay $7M To Settle Securities Class Action

    AgFeed Industries Inc. agreed to pay $7 million to end a putative class action brought by investors who said the bankrupt animal nutrition and commercial hog-production company and its executives lied about the company’s financial health, according to a filing in Tennessee court Wednesday.

  • September 17, 2014

    Mentor Investors' Appeal Over $1.1B J&J Sale Tossed

    A California appeals court has ended investor litigation against Mentor Corp. over its $1.1 billion sale to Johnson & Johnson, saying the breast-implant maker's board didn't betray shareholders by choosing the $31-per-share offer, ignoring much higher estimates, because the financial context was uncertain in late 2008 when the sale was conceived.

  • September 17, 2014

    HFT Co. Latour Fined $16M For Mismanaging Capital Buffer

    The SEC registered a landmark $16 million fine Wednesday against high-frequency trading giant Latour Trading LLC for failures connected to its capital cushion, which the agency says Latour repeatedly miscalculated by as much as $37 million for two years — a mistake facilitated by high volume, according to a top official.

  • September 17, 2014

    Cadwalader-Nomura Malpractice Fight Stayed By Top NY Court

    New York's top court on Tuesday halted trial court proceedings in Nomura Asset Capital Corp.'s suit against Cadwalader Wickersham & Taft LLP alleging malpractice related to the firm's work on a securitized real estate loan portfolio amid dueling appeals from a ruling that winnowed the case.

  • September 16, 2014

    Ex-Dewey Controller Reaches Partial Deal With SEC

    Former Dewey & LeBoeuf LLP controller Thomas Mullikin has reached a partial settlement with the U.S. Securities and Exchange Commission that would resolve his liability in the agency's suit over the firm's collapse while leaving open the issue of a potential disgorgement order or fine, according to Tuesday court filings.

  • September 16, 2014

    Class Wins Remand Of Best Buy Stock Option Action

    Employees of a cloud-services company that Best Buy Co. Inc. had sold won remand of their suit accusing it of reneging on stock options contractually promised to them, with a Minnesota federal judge saying Tuesday that Best Buy didn't show the amount at issue exceeds the threshold for removal.

  • September 16, 2014

    Fracking Sand Co. Pays $4M To Settle Investors' IPO Claims

    Hi-Crush Partners LP got an early nod from a New York federal judge Tuesday to pay $3.8 million cash to stomp out allegations the fracking sand maker sugarcoated the souring relationship with one of its largest clients in the lead-up to its initial public offering.

  • September 15, 2014

    Morgan Stanley Fined For Accounts Tied To Ponzi Scheme

    Morgan Stanley Smith Barney LLC has agreed to pay a $280,000 civil penalty to resolve allegations that it failed to properly supervise the opening and handling of accounts that were ultimately used to facilitate a $35 million Ponzi scheme, the U.S. Commodity Futures Trading Commission said Monday.

  • September 12, 2014

    Royal Park Can't Get 2nd Shot At BofA In $1.6B MBS Fight

    A California federal judge on Thursday refused to reconsider claims brought by Royal Park Investments SA/NV against Bank of America Corp., part of multidistrict litigation over problems with $1.6 billion in mortgage-backed securities from Countrywide Financial Corp., finding the court had not ignored material facts.

  • September 12, 2014

    Deutsche, Goldman Win $37M In Fees For CVR Defense

    A New York judge has awarded Goldman Sachs & Co. and Deutsche Bank Securities Inc. $37 million in fees for helping defend Texas-based oil refiner CVR Corp. from a $2.6 billion takeover by noted raider Carl Icahn, saying the banks' enlistment contract with CVR was crystal clear — even though the defense failed.

  • September 12, 2014

    HSBC Reaches $550M Toxic MBS Deal With FHFA

    HSBC Holdings PLC will pay $550 million to end a New York federal suit brought by the Federal Housing Finance Agency accusing it of selling toxic residential mortgage-backed securities to Fannie Mae and Freddie Mac, it announced on Friday.

  • September 12, 2014

    Forum Selection Bylaws Shrug Off Investor Backlash

    A Delaware Chancery judge's Monday ruling that First Citizens BancShares Inc.’s bylaws can require nearly all intra-corporate disputes to be litigated in North Carolina continued a trend in favor of corporate forum selection bylaws, further cementing the hurdles shareholders must overcome to prove such provisions go too far.

  • September 11, 2014

    5th Circ. Lets Stanford Receiver Claim $32M From Investors

    The Fifth Circuit on Thursday refused to stop a receiver from recovering about $32 million to distribute to victims of the R. Allen Stanford Ponzi scheme, ruling that investors who profited under the fraud had no valid claim for interest on their certificates of deposit.

  • September 11, 2014

    HP Russia Pleads Guilty to Bribery, Will Pay $58.8M Fine

    A California federal judge on Thursday accepted a guilty plea from Hewlett-Packard Co.’s Russian subsidiary for bribing Russian officials to snag a $45 million government contract, sentencing the company to pay a nearly $59 million fine, prosecutors said.

  • September 11, 2014

    S&P Must Open Records On Financial Crisis-Era Ratings

    A New York state appeals court ordered McGraw-Hill Financial Inc. on Thursday to unlock a trove of Standard & Poor's Financial Services LLC ​internal records that a pension fund claims will show S&P ​propped up ratings for countless wilting securities, saying shareholders can access much more than McGraw-Hill thought.

  • September 11, 2014

    Nomura Loses Bid To Make Insurer Pay For RMBS Litigation

    A New York federal judge on Thursday let Federal Insurance Co. off the hook from covering Nomura Holding America Inc. in five underlying suits over misleading securitizations of residential mortgage-backed securities, finding the claims are related to a previous suit and precluded from coverage.

  • September 11, 2014

    Ex-Duane Reade CEO Can't Duck $7.6M Fraud Restitution

    The former Duane Reade Inc. CEO who completed a securities fraud sentence in December will have to pay the bulk of a federal judge's $7.6 million restitution order, after the Second Circuit largely upheld the decision on Thursday while questioning the award of legal fees to outside counsel in the suit.

Expert Analysis

  • 4 Hot Issues In 3rd-Party Due Diligence

    Michael Volkov

    Lawyers who deal with anti-corruption risks and third parties have passed around standard clauses they like to use in their agent and distributor contracts. But taking a more creative approach to contract drafting is an important way to minimize risk, says Michael Volkov of The Volkov Law Group LLC.

  • 5 Takeaways From SEC's Filing Violation Sweep

    Nicolas Morgan

    The U.S. Securities and Exchange Commission’s having hit pay dirt — 34 defendants and $2.6 million in civil penalties — from the application of quantitative analysis portends further, future applications, including in the area of financial fraud, say Patrick Hunnius and Nicolas Morgan of DLA Piper.

  • Settling After Class Denial — If Only It Were That Easy

    Michael V. Rella

    The denial of class certification, while significant, does not conclusively dispatch a class claim. The class claim might reappear even after the defendant settles with the former lead plaintiff and the final judgment is entered, say James Goldfarb and Michael Rella of Murphy & McGonigle PC.

  • Forum Selection Bylaws Are Best Considered On A Clear Day

    Michael G. O’Bryan

    An Oregon court’s decision in Roberts v. TriQuint SemiConductors Inc. shows that enacting an exclusive forum provision on a clear day, before a company sees the storm clouds of litigation on the horizon, may support the enforceability of the provision, say attorneys with Morrison & Foerster LLP.

  • Scotland — The 'Succession Event' Question

    James Duncan

    A vote for an independent Scotland will have many consequences for the United Kingdom. Unsurprisingly, the implications for U.K. sovereign credit default swaps have not featured prominently in the public debate, say attorneys with Shearman & Sterling LLP.

  • Bandfield Confirms Aggressive FATCA Enforcement Tactics

    Miriam L. Fisher

    The scheme detailed in the U.S v. Robert Bandfield indictment follows a well-worn path of prior offshore financial frauds, but the prosecutors’ focus on the defendants’ alleged attempt to avoid compliance with the Foreign Account Tax Compliance Act sends a strong message to the global financial community, say Miriam Fisher and Brian McManus of Latham & Watkins LLP.

  • Readying For A New First Monday

    Fred T. Isquith

    Fall is in the air. September is flying by. In a few weeks the U.S. Supreme Court will be convening again. But while there are securities cases on the docket, there is nothing as momentous as Halliburton, says Fred Isquith of Wolf Haldenstein Adler Freeman & Herz LLP.

  • 2nd Circ. Ruling Clears FINRA Arbitration Confusion

    Jeff Kern

    The Second Circuit’s decision in Citigroup Global Markets Inc. v. Abbar provides an efficient framework for determining whether the Financial Industry Regulatory Authority’s mandatory arbitration rule is applicable to investor-initiated claims, and should serve to diminish the sort of “sprawling litigation” that transpired there, say Jeff Kern and Manuel Gomez of Sheppard Mullin Richter & Hampton LLP.

  • OPINION: Pro Bono May Help Diversity Recruiting Efforts

    David A. Lash

    A recent Law360 article about the perennial BigLaw concern over how to recruit and retain female and ethnically diverse attorneys addressed a new approach being taken by some law firms — going beyond traditional mentoring programs by creating a sponsorship relationship. Pro bono can also play a part, say David Lash and Merle Vaughn of the Association of Pro Bono Counsel.

  • More State Courts Upholding Forum Selection Bylaws

    Melissa L. Nunez

    The recent case of Groen v. Safeway represents a clear move by California to join the growing list of states going on record to endorse the enforceability of forum selection provisions in corporate bylaws, say Robert Friedel and Melissa Nunez of Pepper Hamilton LLP.