1st Circ. Says F-Squared's $7.7M Fee Claim May Hinge On SEC

Law360, Boston (October 10, 2019, 3:27 PM EDT) -- The relative "possibility" of a U.S. Securities and Exchange Commission enforcement action after an investigation begins may determine whether the bankruptcy trustee for F-Squared Investments Inc. can recoup $7.7 million in legal fees spent during the investigation, the First Circuit said Thursday.

The three-judge panel wondered if the trustee was helping his case by asking the court to consider whether F-Squared knew it was "reasonably possible" that it would be caught in the commission's crosshairs after the firm received a subpoena on Oct. 2, 2013, the day before its XL Specialty Insurance Co. and Zurich American Insurance Co. policies kicked in....

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