Securities

  • September 30, 2014

    Goldman, Others Get Initial Approval For $590M LBO Deals

    A Massachusetts federal judge on Monday granted initial approval to $590 million in settlements with a class of shareholders who claim Goldman Sachs Group Inc., Carlyle Group LP and several other private equity firms teamed up to keep leveraged buyout prices low.

  • September 30, 2014

    CFTC Orders $1.6M Payment In Foreign Exchange Scam

    The U.S. Commodity Futures Trading Commission on Tuesday ordered a Utah man and his company to pay $1.641 million in restitution and penalties to settle civil charges that they ran a foreign exchange Ponzi scheme that defrauded almost 50 Japanese citizens.

  • September 30, 2014

    Credit Suisse Wins Court Confirmation Of $1.3M FINRA Award

    A Florida federal judge on Monday blessed a $1.3 million arbitration award handed to Credit Suisse Securities (USA) LLC in a breach of contract action over a disputed trade with CRL Management LLC, finding the Financial Industry Regulatory Authority panel had justifiable grounds for its decision.

  • September 30, 2014

    Trader In Simpson Thacher Insider Case Ordered To Repay $3M

    A Financial Industry Regulatory Authority arbitration panel has ordered a former Morgan Stanley Smith Barney LLC broker to repay nearly $3 million in bonuses he was awarded prior to being accused of an insider trading scheme that also ensnared a former Simpson Thacher & Bartlett LLP clerk.

  • September 30, 2014

    6th Circ. Axes Funds' Suit Over BlackRock Lending Fee

    The Sixth Circuit held Tuesday that two BlackRock Inc. affiliates didn't violate federal law when they allegedly squeezed high fees out of mutual funds for their securities lending services, saying they had an exemption from the U.S. Securities and Exchange Commission.

  • September 30, 2014

    SEC Accuses Two Of Illegal Tips On Ackman's Herbalife Bet

    The U.S. Securities and Exchange Commission on Tuesday got tangentially involved in activist investor Bill Ackman’s public feud with Herbalife Ltd., when it accused two people of breaking insider trading rules in the run-up to Pershing Square Management LP’s $1 billion bet against the supplement maker.

  • September 30, 2014

    SEC In Settlement Talks With Evercore Insider Trader

    The U.S. Securities and Exchange Commission is in settlement talks with Frank Perkins Hixon Jr., a former Evercore Partners Inc. investment banker who was sentenced in August to 30 months in prison for insider trading, according to a recent court filing.

  • September 29, 2014

    Firm Owner Admits Paying $1M In Bribes To JPMorgan, GMAC

    The owner of two San Diego-based mortgage investment firms admitted in California federal court on Friday that he paid $1 million in bribes to "insiders" at JP Morgan Chase Bank NA, GMAC Mortgage LLC and National City Bank in order to win bids for mortgage loans sold on the secondary market, according to federal prosecutors.

  • September 29, 2014

    Citi Unit, Others Get Thornburg Trustee's $2B Suit Trimmed

    A Maryland bankruptcy judge has pared a nearly $2 billion suit by Thornburg Mortgage Inc.'s trustee alleging that units of Citigroup Inc. and other banks made unfair margin calls and other improper agreements that brought the mortgage lender to its knees, finding that the agreements central to some of the claims are safe-harbored.

  • September 29, 2014

    Avon Shareholders' FCPA China Bribe Class Action Tossed

    A New York federal judge on Monday tossed a putative class action by Avon Products Inc. shareholders that accused the company and its senior executives of falsely inflating stock prices by hiding violations of the Foreign Corrupt Practices Act.

  • September 29, 2014

    Medtronic Can't Shake Investors' Claims Of Tainted Studies

    A Minnesota federal judge on Monday refused to throw out the bulk of a securities class action alleging Medtronic Inc. downplayed problems with its bone graft products, saying the investors’ allegations that the medical device maker manipulated studies to drive up its stock price are adequate.

  • September 29, 2014

    Argentina Held In Contempt For Debt Bypass Plan

    A New York federal judge on Monday held Argentina in contempt of court for taking steps to evade his orders that bondholders who agreed to debt restructurings can only be paid if holdout hedge funds are also compensated, calling such plans illegal.

  • September 29, 2014

    Wal-Mart Can't Escape Suit Over Mexico Bribery Allegations

    An Arkansas federal judge on Friday denied a bid from Wal-Mart Stores Inc. and its former CEO to dismiss a proposed class action alleging the retailer concealed Mexican bribery allegations from shareholders, ruling claims that Wal-Mart intentionally withheld the information from a regulatory filing are "plausible."

  • September 29, 2014

    ATP Oil Execs Escape Suit Over $1.5B Note Exchange

    A Louisiana federal judge on Friday tossed a consolidated securities class action alleging bankrupt ATP Oil & Gas Corp.’s top executives misled investors ahead of a $1.5 billion note exchange about its liquidity and business prospects following drilling moratoriums enacted after the Deepwater Horizon oil spill.

  • September 29, 2014

    High Court Reverses Decision To Hear IndyMac Appeal

    The Supreme Court on Monday revoked its granting of cert in a dispute over whether a tolling provision should apply to certain securities suits, just days after the litigants said a settlement in the underlying class action wouldn’t impact the appeal.

  • September 29, 2014

    SEC Hits BofA With $7.65M Fine Over Merrill Deal

    Bank of America Corp. has agreed to pay the U.S. Securities and Exchange Commission $7.65 million to settle charges it violated internal controls and recordkeeping provisions after assuming a large portfolio of structured notes when it bought Merrill Lynch & Co. Inc. in 2009, the SEC said Monday.

  • September 26, 2014

    MBIA Lands 2nd Shot At JPMorgan In $168M MBS Suit

    MBIA Insurance Corp. will get another shot at JPMorgan Chase & Co. in its suit over $168 million in payments it had to make to investors in a Bear Stearns-sold mortgage-backed securities trust that busted in the housing collapse, according to a New York state court decision entered Friday.

  • September 26, 2014

    Deal Rejected In Abercrombie Shareholder's CEO Pay Suit

    An Ohio federal judge on Friday rejected retailer Abercrombie & Fitch Co.’s settlement with a shareholder who accused company directors of violating their fiduciary duties by failing to link CEO pay with performance and other lapses, saying the plaintiff hasn’t shown the deal is fair.

  • September 26, 2014

    Brothers Still Can't Duck Chattem Insider Trading Verdict

    Two brothers found liable for buying shares of drug company Chattem Inc. on insider information ahead of its purchase by Sanofi-Aventis Inc. again lost their bid to dodge the jury’s verdict, an Ohio federal judge ruled Thursday, finding their arguments to be untimely.

  • September 26, 2014

    Chancery Allows Early Appeal In $255M Cornerstone Deal Suit

    A Delaware Chancery judge on Friday allowed Cornerstone Therapeutics Inc. director defendants to appeal his ruling that kept them on the hook for breach of fiduciary duty claims related to Chiesi Farmaceutici SpA's $255 million buyout of the company, as the investor lawsuit moves forward.

Expert Analysis

  • And Now A Word From The Panel: ABCs Of JPML Practice

    Alan E. Rothman

    This week, as the Judicial Panel on Multidistrict Litigation embarks on a rare October hearing, we cannot resist mentioning an intriguing MDL petition that involves local rules governing attorney admission and several lawsuits naming members of the federal judiciary — including a JPML member who is also a D.C. district court judge, says Alan Rothman of Kaye Scholer LLP.

  • DOJ Proposal Shows Focus On Individuals In Corporate Crime

    Helen Cantwell

    The U.S. Department of Justice's proposal to import Park liability to financial crimes would require legislative action and is unlikely to gain traction for other reasons. Nevertheless, it is significant that the attorney general considers such liability for financial executives to be desirable, say attorneys with Debevoise & Plimpton LLP.

  • 2 Reasons Chancery's Swomley Ruling Is Notable

    Allison C. Handy

    The Delaware Chancery Court’s ruling in Swomley v. Schlecht is a good reminder that, although the risks of stockholder litigation in the context of a private-company merger or acquisition are lower as a practical matter, directors of private companies are generally held to the same standards as directors of public companies, say attorneys with Perkins Coie LLP.

  • Should FIRREA Whistleblower Bounties Be Higher?

    Andrew W. Schilling

    The Financial Institutions Reform, Recovery, and Enforcement Act’s whistleblower bounties at False Claims Act levels could lead to absurdly high and wastefully excessive awards. At the same time, U.S. Attorney General Eric Holder may be right when he suggests that awards capped below annual bonuses may not be enough to encourage confidential reporting by well-placed Wall Street insiders, says Andrew Schilling of BuckleySandler LLP.

  • 7 HSR Filing Reminders From Berkshire Hathaway Case

    Deidre Johnson

    The recent civil penalty levied on investment holding company Berkshire Hathaway Inc. for failure to notify under the Hart-Scott-Rodino Antitrust Improvements Act reminds investors that HSR reportability must be vetted even in transactions that are less obviously seen as "acquisitions," say attorneys with Ropes & Gray LLP.

  • Takeaways From SEC Action Against Lincolnshire

    Eva C. Carman

    The U.S. Securities and Exchange Commission’s recent action against private equity firm Lincolnshire Management Inc. is based on a fairly nuanced factual scenario — allocation of expenses between portfolio companies — which suggests that the SEC’s inquiries are becoming more sophisticated, and the action is consistent with a trend we have been seeing toward more nonfraud-based cases, say attorneys with Ropes & Gray LLP.

  • No Longer Under Wraps — SEC Wrap Fee Scrutiny Rising

    Jonny Frank

    Given the U.S. Securities and Exchange Commission's emphasis on wrap fee disclosures, employing forensic auditing and data analytics tools early on can help to detect potential abuse of wrap fee programs and demonstrate a firm’s commitment to compliance, say Jonny Frank and Tristan Cecala of StoneTurn Group LLP.

  • 'Entire Fairness' Is More Than Just A Fair Price

    Diane Holt Frankle

    Vice Chancellor John Noble recently held in a Nine Systems Corp. shareholder case that a recapitalization, although approved and implemented at a fair price, was not entirely fair due to the grossly unfair process — a ruling that teaches, among other things, that a robust negotiation is helpful to demonstrate fair dealing, says Diane Holt Frankle of Kaye Scholer LLP.

  • Opportunities And Pitfalls In The Legal Cloud

    David Houlihan

    Like "big data" and other effective software marketing buzzwords, “cloud” makes something that is very complex sound simple — and even friendly. Most attorneys are not prepared to dig into the distinctions between public, private and hybrid cloud models, or the niceties of how or where their data is transmitted and stored, says David Houlihan of Blue Hill Research Inc.

  • Asset Managers Must Prepare For The Magnifying Glass

    Perrie M. Weiner

    The combined import of the U.S. Securities and Exchange Commission’s announced “sweep” of alternative mutual funds and recently reported potential regulations is that asset funds are now on the SEC’s radar, and additional oversight and regulatory scrutiny are all but assured in the near future, say attorneys with DLA Piper.