Securities

  • March 3, 2015

    BREAKING: 10th Circ. Revives $550M Barclays RMBS Suit

    The Tenth Circuit on Tuesday revived a National Credit Union Administration lawsuit alleging that Barclays Capital Inc. misrepresented the quality of more than $555 million in residential mortgage-backed securities, finding that although the NCUA’s claims were filed too late, Barclays was precluded from having the suit tossed on those grounds.

  • March 2, 2015

    KCG Pays $13M To End Investors' Suit Over $460M 'Glitch'

    A New Jersey federal judge on Monday preliminarily approved a $13 million settlement to end investors' claims that high-frequency trading house Knight Capital Group Inc. knew its internal controls were deficient that led to its $460 million one-day trading loss in 2012.

  • March 2, 2015

    Insurer Wins Atty Fees In DBSI Investor's Bad Faith Suit

    A Montana federal judge ruled Friday that New York Marine and General Insurance Co. didn't act in bad faith in its handling of an investor's claim against an accounting firm over losses tied to a DBSI Inc. real estate investment vehicle, while awarding the insurer attorneys' fees over a bid to disqualify its counsel.

  • March 2, 2015

    Associated Bank Back On Hook In $190M Crown Forex Fraud

    The Eighth Circuit has revived claims that Associated Bank NA aided in part of a $190 million Ponzi scheme, saying the contention that Associated gave “substantial assistance” in the scheme was, in fact, adequately pled.

  • March 2, 2015

    SEC Awards Ex-Co. Officer $500K Whistleblower Bounty

    The U.S. Securities and Exchange Commission is set to pay its 15th whistleblower, a former company officer, between $475,000 and $575,000 for reporting "high-quality, original information" about a securities fraud, the SEC said Monday.

  • March 2, 2015

    FinCEN Fines Pa. Bank $1.5M For Bank Secrecy Act Violation

    The Financial Crimes Enforcement Network on Friday assessed a $1.5 million civil money penalty against the First National Community Bank of Dunmore, Pennsylvania, for willfully violating the Bank Secrecy Act by ignoring red flags in a bank account held by a judge convicted of corruption, according to FinCEN.

  • February 27, 2015

    SEC’s $300M Wyly Judgment Is Only Half The Battle

    The first stage of the U.S. Securities and Exchange Commission’s hard-fought battle against a pair of Texas tycoons came to a close Thursday when a New York federal judge imposed a nearly $300 million judgment against Sam Wyly and the estate of his late brother Charles Wyly, but a new front now opens as the agency looks to collect on the tab amid likely appeals and a bankruptcy proceeding.

  • February 27, 2015

    Texas High Court Won't Rehear Exxon Bonus Plan Suit

    The Supreme Court of Texas on Friday denied an appeal to rehear a former Exxon Mobil Corp. top executive's case against the company for stripping him of $5 million in nonvested stock rights when he joined a rival energy firm, re-confirming the court's decision granting employers more leeway in bonus plans.

  • February 27, 2015

    Dole Expert Must Have 'Body And Brain,' Del. Chancery Says

    Dole Food Co. Inc. can’t use Stifel Nicolaus & Co. Inc. as an expert witness in its defense of a shareholder suit accusing owner David H. Murdock of shortchanging the company in a $1.6 billion take-private deal, the Delaware Chancery Court ruled Friday, saying an expert witness must be a biological person.

  • February 27, 2015

    2nd Circ. Won't Put UBS On Hook For $2.3B In Trader Losses

    The Second Circuit on Friday dismissed a putative class action that had sought to hold UBS AG responsible for investor losses after a trader went off-plan and triggered $2.3 billion in losses, finding that the plaintiffs hadn’t shown the bank had intended to deceive its shareholders.

  • 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 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

    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

    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

    JPMorgan, Deutsche Ordered To Give Argentine Bond Docs

    The New York federal judge overseeing Argentina's bond payback fight with hedge fund NML Capital Ltd. ordered Deutsche Bank AG and JPMorgan Chase & Co. Wednesday to give NML private information on payments regarding a new set of bonds Argentina announced for a select group of creditors.

  • February 26, 2015

    Wachtell Ducks Icahn's Malpractice Claim Over Deal Fees

    A New York state judge has tossed CVR Energy Inc.’s malpractice claim against Wachtell Lipton Rosen & Katz stemming from $37 million in fees incurred by the company as part of Carl Icahn’s takeover, according to an order filed Wednesday, finding CVR can’t argue the firm was responsible for the financial hit.

  • February 26, 2015

    OSG Investors Agree To Settle Suit Over $435M Tax Debt

    A group of Overseas Shipholding Group investors have agreed to settle a class action lawsuit against company executives and others for allegedly hiding the $435 million tax debt that drove the tanker company to bankruptcy, according to letter filed Wednesday in New York federal court by investors’ counsel.

  • February 26, 2015

    Ex-Milbank Atty Gets 15 Months For Investment Fraud

    A disbarred lawyer who once worked as an associate at Milbank Tweed Hadley & McCloy LLP was sentenced in New York federal court Thursday to 15 months in prison for defrauding investors in a Philadelphia real estate venture.

  • February 26, 2015

    Fontainebleau Reaches $115M Deal With Resort Investors

    The failed $2.9 billion Fontainebleau Resort and Casino in Las Vegas has reached a $115 million settlement with investors who say the company kept two sets of books to doctor construction costs, according to lawyers for the plaintiffs.

  • February 25, 2015

    Attorneys React To High Court's Sarbanes-Oxley 'Fish' Ruling

    On Wednesday, the U.S. Supreme Court ruled that an anti-shredding provision of the Sarbanes-Oxley Act does not cover all physical evidence. Here, attorneys tell Law360 why the decision in John L. Yates v. United States of America is significant.

Expert Analysis

  • What The SEC Enforcement Stats Really Tell Us

    Marc J. Fagel

    2014 saw the U.S. Securities and Exchange Commission again heralding that it had filed more enforcement actions than ever before. And, as always, the story is not quite so simple. However, other statistical data released by the agency provides much greater insight into where the enforcement division is focusing its attention, says Marc Fagel, partner at Gibson Dunn & Crutcher LLP and a former regional director at the SEC.

  • DOJ Is Losing The Battle To Prosecute Foreign Executives

    Lauren Briggerman

    The U.S. Department of Justice has yet to extradite a single executive in the auto parts investigation who refuses to voluntarily enter the United States to face charges. As a result, foreign executives from certain countries — particularly in Asia — who refuse to plead guilty may be beyond the reach of U.S. prosecutors, say attorneys with Miller & Chevalier Chtd.

  • Top 10 Reasons To Have An ERISA Litigator On Speed Dial

    Nancy G. Ross

    The U.S. Supreme Court’s heightened interest in the Employee Retirement Income Security Act, an increase in investigations from the U.S. Department of Labor and the dangerous ERISA fiduciary exception to attorney-client privilege are just some of the reasons why companies should have ERISA litigators on speed dial, say Nancy Ross and Brian Netter of Mayer Brown LLP.

  • Yates Ruling Is The Wrong Response To Overcriminalization

    Randall Eliason

    The worst way to respond to overcriminalization is for courts artificially to narrow criminal statutes through results-oriented decisions that ignore the plain language of the law and ultimately lead to irrational results. Unfortunately, that’s exactly what the U.S. Supreme Court did last week in Yates v. United States, says Randall Eliason, a law professor and former federal prosecutor.

  • 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.