Securities

  • June 26, 2017

    Divergence In Materiality Tests Narrower Than It May Seem

    Although the Second Circuit on Wednesday used strong language when it rejected a First Circuit test for assessing the materiality of certain financial information omitted from company registration statements, experts say the alternative laid out by the court sets an equally high bar for IPO investor suits.

  • June 26, 2017

    DC Circ. Split Tees Up High Court Review Of SEC Judges

    The D.C. Circuit split evenly on the question of whether the U.S. Securities and Exchange Commission could overrule its administrative law judges, denying a bid to overturn an earlier decision by a three-judge panel in the case and setting up a U.S. Supreme Court challenge.

  • June 26, 2017

    High Court Won't Consider Ex-CEO's Pump & Dump Conviction

    The U.S. Supreme Court on Monday refused to review an appeal brought by the former CEO of baggage-handling company Universal Express Inc. who was sentenced to three years behind bars for his purported role in a pump-and-dump stock scheme.

  • June 26, 2017

    High Court Applies Strict Time Limit To Securities Suits

    The U.S. Supreme Court on Monday found that the California Public Employees’ Retirement System was too late in filing claims opting out of a securities class action, ruling suits over securities offerings and sales are subject to a statute of repose that can’t be tolled.

  • June 26, 2017

    Justices To Resolve Split Over Dodd-Frank Whistleblowers

    The U.S. Supreme Court on Monday agreed to review whether the Dodd-Frank Act prohibits retaliation against internal whistleblowers who haven’t reported concerns about securities law violations to the U.S. Securities and Exchange Commission, agreeing to consider an issue that has divided appellate courts.

  • June 23, 2017

    Investors Sue DeVry, Ex-CEO Over Hefty False Ad Fines

    A pension fund stockholder of DeVry University Group sued the for-profit educational organization, six directors and its former CEO in Delaware state court Friday, saying the defendants had breached their financial duties by allowing deceptive marketing that cost the organization more than $100 million in regulatory penalties.

  • June 23, 2017

    Snapchat Maker's Arbitration Bid Blasted By Ex-Employee

    The former Snap Inc. employee who claims he was fired for raising concerns about the social media company’s user metrics ahead of its initial public offering fired back at the Snapchat maker’s attempt to force arbitration of his whistleblower suit, telling a California federal court Friday that the arbitration agreement he signed at hiring was unconscionable.

  • June 23, 2017

    Consulting Co. Seeks Attys' Fees After $3.2M Award OK'd

    After a $3.2 million arbitral award was confirmed in its favor in a dispute with a dolphin park operator, a financial consulting company asked a California federal judge to award it more than $50,000 in attorneys' fees, saying it is entitled to them based on a contract between the parties. 

  • June 23, 2017

    $10M Settlement Struck In Providence-Matrix Deal Suit

    The sides in the lawsuit over Providence Service Corp.’s $400 million purchase of Matrix Medical Group told the Delaware Chancery Court on Friday they’d resolved the dispute with a settlement that would see $10 million, minus attorneys’ fees and expenses, paid to the investor class that challenged the deal.

  • June 23, 2017

    AbbVie Fights Hedge Funds’ Bid To Return To State Court

    AbbVie Inc., the biopharmaceuticals giant fending off lawsuits over its failed $55 billion merger with Shire PLC, urged an Illinois federal judge on Thursday not to send a fraud case brought by a group of hedge funds back to state court, saying the case involves federal law.

  • June 23, 2017

    Ex-ITG Head Settles SEC's Foreign Shares Supervision Claims

    The former head of operations at an Investment Technology Group Inc. unit has settled the U.S. Securities and Exchange Commission's allegations that he failed to properly supervise a securities lending desk that allegedly obtained American securities of foreign companies without gaining the underlying foreign shares.

  • June 23, 2017

    Feds Seek $180M Restitution From Cay Clubs Ponzi Execs

    Prosecutors asked a Florida federal judge on Thursday to order four people convicted of lying to banks and investors in the Cay Clubs Resorts and Marinas to pay the victims $180 million, setting the stage for those who have filed claims to get some of their money back.

  • June 23, 2017

    Mortgage Lender's Board Hid Possible Fraud, Investor Says

    A Walter Investment Management Corp. investor sued the mortgage lender’s board of directors in Pennsylvania federal court on Thursday over allegations they knew about but did not disclose the company’s weak internal controls and involvement in potentially fraudulent practices.

  • June 23, 2017

    Wash. State Co. Agrees To CFTC Bar On Commodities Trades

    A couple charged by the U.S. Commodity Futures Trading Commission in a civil suit in Washington federal court with lying to potential investors and fleecing them out of more than $11 million consented to orders issued Friday that bars them from trading in commodities.

  • June 23, 2017

    Judge Denies Implant Sciences Investors A Solicitation Agent

    A request from shareholders of bomb detection hardware maker Implant Sciences to retain a solicitation agent for the company’s proposed Chapter 11 plan failed to receive court approval Friday in Delaware because the court determined the services were unnecessary.

  • June 23, 2017

    Ex-BigLaw Atty Taps Proskauer For Post-Verdict Defense

    Robert Schulman, the former Hunton & Williams LLP patent lawyer convicted of insider trading on a Pfizer deal, has tapped a Proskauer Rose LLP appellate partner for his post-verdict defense, a Thursday filing said.  

  • June 23, 2017

    Fox Rothschild Adds Ex-Greenbaum Rowe Litigation Pro In NJ

    Fox Rothschild LLP has boosted its Morristown, New Jersey, office with a new litigation partner from Greenbaum Rowe Smith & Davis LLP with more than 20 years of experience representing real estate companies, technology firms and other businesses in court.

  • June 23, 2017

    Best Buy Investors Denied 2nd Shot At Class Certification

    A Minnesota federal court on Friday refused to give Best Buy shareholders another chance at certifying their stock-drop class action after the Eighth Circuit ruled last year that the retailer’s share price wasn’t impacted by its executives’ statements on a conference call.

  • June 23, 2017

    Clovis Reaches $142M Deal To Resolve Stock Drop Suit

    Clovis Oncology Inc. has agreed to pay $142 million in cash and stock to settle a proposed class action that claimed the company inflated its stock price by misleading investors about the efficacy of a cancer drug, shareholders told a Colorado federal court Thursday.

  • June 23, 2017

    Rookie Judge Faces 'Trial By Fire' In Texas AG's Fraud Case

    The newly elected Harris County district judge who is now overseeing the felony securities fraud case against Texas Attorney General Ken Paxton is in store for a “trial by fire” that will force the rookie jurist to navigate choppy political waters and unclear law on the charges at hand, experts say.

Expert Analysis

  • State AGs Responding To Trump Policies: 3 Areas To Watch

    Michael Rossetti

    The federal government’s unfolding enforcement priorities have galvanized state attorneys general into action. We expect this trend to continue, say attorneys with Akin Gump Strauss Hauer & Feld LLP.

  • 2 Diverging Standards On Disclosing Interim Financial Info

    Kevin LaCroix

    With the Second Circuit's opinion in Stadnick v. Vivint Solar, we now have a situation where two federal appellate courts have promulgated differing standards to determine when companies making initial public offerings must disclose interim financial information. The question is whether we have a “split between the circuits” of the kind that might attract the attention of the U.S. Supreme Court, says Kevin LaCroix of RT ProExec.

  • Monthly Column

    Gray Matters: We Feel, We Decide

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    Despite legal education training and the focus on logic and reason by the courts, lawyers address emotional issues on a daily basis — albeit more indirectly. But a shift to consciously and strategically addressing emotions gives us a powerful tool to help our clients reach faster, better decisions, say dispute resolution experts Robert Creo and Selina Shultz.

  • Index Eligibility As Governance Battlefield

    Ethan Klingsberg

    The recently launched campaign by the Council of Institutional Investors, among others, to block Snap Inc.’s eligibility for S&P Dow Jones and other indices may be looked back on as a turning point in an expansion of the governance battlefield. Recent developments in the realm of dual-class issuers shed light on whether this potential movement of governance matters into index eligibility criteria is sensible, says Ethan Klingsberg ... (continued)

  • The Misconception About SWS Appraisal Decision

    Gail Weinstein

    The Delaware Chancery Court’s recent decision in SWS Group raises the question whether below-the-merger-price appraisal results will now become more common. A number of commentators have suggested that the answer is yes, but their conclusion follows what we believe to be a misconception, say attorneys with Fried Frank Harris Shriver & Jacobson LLP.

  • Opinion

    Justice Kennedy's Moderating Influence On The High Court

    Nan Aron

    The guessing game around Justice Anthony Kennedy’s possible retirement is reaching a crescendo. Yet the speculation does more than fuel bookmakers’ odds. It draws attention to his pivotal role as the court’s swing vote, says Nan Aron, president of Alliance for Justice.

  • Clarifying Anti-Retaliation Protections Under Dodd-Frank

    Stephen Kohn

    What protections are available under the Dodd-Frank Act’s whistleblower law if an employee reports securities fraud within the company? Courts have pointed to two separate definitions of “whistleblower” under the law to justify their differing positions. However, a more careful review of its history should resolve this prolonged dispute, says Stephen Kohn of Kohn Kohn and Colapinto LLP.

  • A Resurgence Of Synthetic Securitizations

    Daniel Budofsky

    After a major market contraction in the wake of the financial crisis, risk-pooling transactions show signs of gaining favor once more, says Daniel Budofsky of Pillsbury Winthrop Shaw Pittman LLP.

  • How Kokesh Will Impact The FTC And Other Agencies

    Benjamin Mundel

    The U.S. Supreme Court's recent decision in the Kokesh case limits not just U.S. Securities and Exchange Commission enforcement actions, but also monetary relief sought by other agencies, like the Federal Trade Commission. A faithful application of this decision should lead to courts rejecting these agencies' long-standing practice of seeking penal monetary relief under their equitable authority, say Benjamin Mundel and Lucas Crosl... (continued)

  • Tax Deductibility And Statutory Damages — A Waiting Trap

    Peter Robbins

    Statutory damages guarantee a minimum recovery in each individual case where a violation may cause only nominal damage. But aggregated statutory damages in class actions can create a risk of staggeringly large awards, which may not be tax-deductible. Companies must know the law and take steps to minimize tax consequences, says Peter Robbins of Corbett & Robbins LLP.