Securities

  • May 25, 2017

    Qualcomm Socked With Investor Suit After Shares Dip 35%

    Investors in Qualcomm Inc. hit the semiconductor giant with a shareholder lawsuit in Delaware federal court Thursday, alleging its leadership dropped the ball by pushing hard-line policies that led to record-breaking antitrust fines and rushing a defective mobile chip to market that led to a major drop in sales.

  • May 25, 2017

    'Hedge Fund' Founder Pleads Guilty To Fraud Charges

    A would-be hedge fund founder pled guilty Thursday in New York federal court to a conspiracy charge tied to his alleged ploy to lure investors into a new fund by touting its great prior performance — performance that didn’t exist — prosecutors said.

  • May 25, 2017

    LendingClub Stock Drop Suit Moves Forward Mostly Intact

    A California federal judge allowed the bulk of a proposed class action accusing LendingClub Corp. of hiding defective internal controls to go forward on Thursday, but ruled that the investors behind the suit will need to tighten up some of their claims.

  • May 25, 2017

    7th Circ. Backs CFTC Dismissal Of $3.6M Trading Loss Suit

    The Seventh Circuit said Thursday that a family trust waited too long to bring claims over its $3.6 million loss in futures contracts trading, upholding a U.S. Commodity Futures Trading Commission ruling that the trust's arbitration of the claims did not pause their time limits.

  • May 25, 2017

    Broker Agrees To Deal Over Alleged REIT Violations

    A broker-dealer has agreed to pay $650,000 to resolve allegations that the business unlawfully sold units in non-publicly traded real estate investment trusts to unsuitable New Jersey investors and failed to make and keep adequate records for its sales, state officials announced Thursday.

  • May 25, 2017

    Billionaire Developer Peppers Judge Ahead Of UN Bribe Trial

    Chinese real estate billionaire Ng Lap Seng's legal team has lodged a flurry of letters ahead of the developer's Tuesday bribery trial, with the latest missive Thursday saying a key cooperating witness may have made undisclosed exculpatory statements during plea talks with prosecutors.

  • May 25, 2017

    Subprime Auto Loan Co. Execs Cop To $11M Fraud

    Two Massachusetts men pled guilty in Boston federal court Thursday to an $11 million fraud scheme in which they falsely told investors that their subprime auto loan company could accept tax-advantaged retirement account funds.

  • May 25, 2017

    Helicopter Service Co.'s $3.9M Deal Denied Preliminary OK

    A New York federal judge on Thursday refused to preliminarily approve a $3.9 million settlement that would resolve a proposed investor class action against helicopter services giant CHC Group Ltd., citing concerns that absent class members could think “the deck is stacked against them” before they can object to the deal.

  • May 25, 2017

    DOJ To Send Fraud Prosecutor To UK Financial Watchdog

    The U.S. Department of Justice expects to detail an anti-corruption prosecutor to Britain’s Financial Conduct Authority in the coming months in the first assignment of its kind, a high-ranking DOJ official said in a speech Wednesday.

  • May 25, 2017

    4 Investors Settle SEC's Coffee Co. Pump-And-Dump Claims

    A California federal judge gave the green light on Wednesday for four offshore investors to pay the U.S. Securities and Exchange Commission nearly $1.7 million in disgorgements and interest to settle allegations that they participated in a $78 million pump-and-dump scheme involving shares of Jammin’ Java Corp., a coffee company originally founded by Bob Marley’s son Rohan.

  • May 25, 2017

    9th Circ. Says Old Suits Make Investor Class Claims Timely

    The Ninth Circuit on Wednesday revived a proposed shareholder class action alleging fertilizer manufacturer China Agritech Inc. overstated its revenue numbers, allowing putative class claims to proceed despite the investors being unnamed members in two now-concluded, almost identical suits in which class certification was denied.

  • May 25, 2017

    SEC Says Unregistered Adviser Bilked $2.1M From Investors

    The U.S. Securities and Exchange Commission sued a former options trading instructor in North Carolina federal court on Wednesday, claiming that he raised $2.1 million for two investment funds without the proper registrations and then concealed how he was using and losing investors’ money.

  • May 25, 2017

    Top Pence Aide Wants Bank Creditors To Play Regulatory Role

    A top adviser to Vice President Mike Pence on Thursday said that the Trump administration’s main priority in changing financial regulation will be to help creditors and other market participants take a more active role in policing markets.

  • May 25, 2017

    Global Regulators Set FX Market Conduct Code After Scandals

    Central bankers and foreign exchange players on Thursday unveiled a voluntary global code of conduct establishing good practices for wholesale foreign exchange markets, hoping to restore faith in a $5 trillion daily market beset by several enforcement probes and antitrust litigation alleging manipulation.

  • May 24, 2017

    Feds Drop Charges In $30M Pump-And-Dump Row, Cite Ruling

    A federal prosecutor told a New Jersey federal judge Wednesday that the government is dropping criminal charges against an investment adviser in a more-than-$30 million stock market manipulation scheme in light of a ruling dismissing charges in a separate securities fraud case on statute of limitations grounds.

  • May 24, 2017

    8th Circ. Lets St. Louis Bank Out Of Sigillito Ponzi Claims

    The Eighth Circuit on Wednesday let St. Louis Bank off the hook in a suit by investors in a $56 million Ponzi scheme orchestrated by St. Louis attorney and Anglican bishop Martin Sigillito, finding the bank didn’t know the money moving through his accounts was being stolen.

  • May 24, 2017

    Theranos Dodges Investors’ ‘Boundless’ Docs Bid, For Now

    A California magistrate judge refused Wednesday to order Theranos to provide a putative shareholder class with all documents the beleaguered startup produced in similar, recently settled suits over claims it lied about the accuracy of its blood tests, saying he opened discovery, but “that doesn’t mean discovery is boundless.”

  • May 24, 2017

    Judge Won’t Wade Into Mich. Biopharma Co.’s Proxy Fight

    A Michigan federal judge on Wednesday rejected a request by biopharmaceuticals firm Rockwell Medical Inc. that he require several shareholders to register themselves as a group and curtail their contacts with other investors, saying he doesn’t want to chill shareholder activism.

  • May 24, 2017

    Sito Investor Says Voted-Out Board Is Squatting

    Five of targeted-ad company Sito Mobile Ltd.’s six board members were sued in Delaware Chancery Court on Wednesday by a shareholder who says they failed to relinquish their board seats after a vote that removed them.

  • May 24, 2017

    Scripts Unit Awarded $4.6M Refund Withheld By Co. Suing It

    The Delaware Court of Chancery on Tuesday ordered a health company to turn over to an Express Scripts unit that it’s suing for fraud a $4.6 million tax refund it owes based on the sale of a subsidiary, as the chancellor ruled that the lawsuit from the sale had nothing to do with the tax owed.

Expert Analysis

  • Keeping Up With The SEC's Enforcement Priorities

    Jack Yoskowitz

    Often, the U.S. Securities and Exchange Commission’s enforcement priorities only become apparent once the commission begins to crack down on a particular practice. A recent decision in the case of Revelation Capital highlights the need for firms, when faced with a new SEC priority, to be able to quickly pivot toward a defensive approach, say Jack Yoskowitz and Laura Miller of Seward & Kissel LLP.

  • Roundup

    Revisiting Affiliated Ute

    Ute thumbnail

    45 years after the U.S. Supreme Court's ruling in Affiliated Ute Citizens of Utah v. United States, defense and plaintiffs attorneys explored what the decision means today. Catch up if you missed the special series.

  • Series

    Revisiting Affiliated Ute: A Rare Presumption In 11th Circ.

    Brian Miller

    The Eleventh Circuit has made clear that it will strictly construe the U.S. Supreme Court's Affiliated Ute decision as well as the omission language of Rule 10b-5(b). This will continue to present challenges to the plaintiffs bar in this circuit, say Brian Miller and Samantha Kavanaugh of Akerman LLP.

  • My Milkshake Is Better Than Yours: Part 2

    Jill Dessalines

    In the second installment of this two-part series on disruptive innovation among mid-size law firms, Jill Dessalines, founder of Strategic Advice for Successful Lawyers and former senior vice president at McKesson Corp., explores a number of ideas for keeping clients and maintaining market position.

  • The IRS Brings Partial Clarity To North-South Scenarios

    Aaron Pinegar

    When a shareholder transfers property to a distributing corporation shortly before or after a spinoff, will the transfer to the distributing corporation be respected as a separate transaction from the distribution for tax purposes? The IRS' recent ruling on such "north-south" transactions provides helpful guidance for some situations, but leaves other questions unanswered, says Aaron Pinegar of Baker Botts LLP.

  • Extending Omnicare Beyond The Section 11 Case

    William Sullivan

    With its recent decision in a securities suit against Align Technology, the Ninth Circuit joined the Second Circuit in applying Omnicare’s heightened falsity pleading standards to Section 10(b) and Rule 10b-5 fraud claims. Companies should therefore pay attention to the Omnicare standards as applied to all of their public statements, say attorneys with Paul Hastings LLP.

  • My Milkshake Is Better Than Yours: Part 1

    Jill Dessalines

    As I sat there listening, incredulous to learn that "Milkshake" was not only a real song but also a chart-topper, it reminded me of Harvard Business School Professor Clayton Christensen’s work on disruptive innovation — and how it pertains to mid-size law firms, says Jill Dessalines, founder of Strategic Advice for Successful Lawyers and former assistant general counsel of McKesson Corp.

  • The Risk Of Liability After A Preferred Stock Redemption

    Gail Weinstein

    The Delaware Chancery Court's recent decision in Frederic Hsu Living Trust v. ODN highlights the potential liability that private equity sponsors and directors face when preferred stock held by the sponsor is redeemed. If future decisions intensify this risk, sponsors could consider alternative investment structures, say attorneys with Fried Frank Harris Shriver & Jacobson LLP.

  • Series

    Revisiting Affiliated Ute: And Its Limits In The 5th Circ.

    Susanna Buergel

    Given the perceived higher hurdles to class certification, it is likely that counsel for plaintiffs in securities cases will seek to recharacterize their claims as omission claims to take advantage of the 45-year-old Affiliated Ute presumption. In the Fifth Circuit, that will be a challenging task, say attorneys with Paul Weiss Rifkind Wharton & Garrison LLP.

  • FHFA Should Free Captive Insurer Capital

    Jeffrey Murphy

    The Federal Housing Finance Agency's ruling that prevents captive insurance companies from becoming members of the Federal Home Loan Bank system is forcing billions of dollars of private capital out of the U.S. residential mortgage market. Hopefully, the Trump administration and members of Congress will be able to convince FHFA Director Melvin Watt to reverse this ruling, says Jeffrey Murphy of Dentons.