BOSTON - Lead plaintiffs in a securities class action lawsuit against a drug maker and one of its executive officers have failed to cure deficiencies in their amended complaint and still failed to plead loss causation, a federal judge in Massachusetts ruled June 11 (Boris Urman, et al. v. Novelos Therapeutics, Inc., et al., No. 10-10394, D. Mass.). Subscribers may view the opinion available within the full update.
NEW YORK - The conditions precedent to liability have not been satisfied under an insured's fourth, fifth and seventh excess insurance policies, a New York appeals panel ruled June 12, affirming summary judgment in favor of five excess insurers in a bankers professional liability and securities action coverage dispute (JP Morgan Chase & Co., et al. v Indian Harbor Insurance Company, et al., No. 6466, N.Y. Sup., App. Div., 1st Dept.; 2012 N.Y. App. Div. LEXIS 4627).
SAN FRANCISCO - A former partner with bankrupt law firm Dewey & Leboeuf on June 12 filed a lawsuit in a California state court against principals in the firm, seeking damages for alleged fraud and contending that the principals deliberately misrepresented the firm's financial condition to attract attorneys to join Dewey (Henry Bunsow v. Steven H. Davis, et al., No. 12-521540, Calif. Super., San Francisco Co.). Subscribers may view the complaint available within the full update.
NEW YORK - A New York federal judge did not err in adopting a license fee proposed by defendant DMX Inc. in its dispute with Broadcast Music Inc. (BMI) and the American Society of Composers, Authors and Publishers (ASCAP), the Second Circuit U.S. Court of Appeals ruled June 13 (Broadcast Music Inc. v. DMX Inc., No. 10-3429; American Society of Composers, Authors and Publishers v. DMX Inc., No. 11-127, 2nd Cir.). Subscribers may view the decision available within the full update.
CHARLOTTE, N.C. - A federal judge in North Carolina on June 13 granted JPMorgan Chase & Co. Inc.'s (Chase) motion to dismiss a suit arising from a loan Chase acquired from Washington Mutual Inc. (WaMu), ruling that Chase did not assume any of WaMu's liability when it purchased certain WaMu assets from the Federal Deposit Insurance Corp. (Justus A. Oketch v. JPMorgan Chase & Co. Inc., No. 12-0102, W.D. N.C.; 2012 U.S. Dist. LEXIS 81606).
WEST PALM BEACH, Fla. - A shareholder on June 11 responded to a motion to dismiss his derivative lawsuit in a Florida federal court, claiming that he had sufficiently pleaded that presuit demand on a board of directors would have been futile (Jack Long, Derivatively on Behalf of Office Depot, Inc. v. Steve Odland, et al., No. 11-cv-80702, S.D. Fla.).
MIAMI - A federal judge in Florida on June 12 denied the Securities and Exchange Commission's request for de facto immunity from depositions under Federal Rule of Civil Procedure 30(b)(6) in a lawsuit it initiated against an attorney accused of making false public statements in connection with the purchase of penny stocks because the agency can still raise objections over questions related to privileged information by asserting protections available to all litigants (Securities and Exchange Commission v. Stewart A. Merkin, No. 11-23585-CIV-GRAHAM/GOODMAN, S.D. Fla.; 2012 U.S. Dist. LEXIS 80922).
WILMINGTON, Del. - Bankrupt Tribune Co. on June 11 filed its 54th objection to more than $98 million in creditor claims in the U.S. Bankruptcy Court for the District of Delaware, contending that pursuant to 11 U.S. Code Section 502(b) and other bankruptcy rules, the claims should be disallowed (In Re: Tribune Company, No. 08-13141, Chapter 11, D. Del. Bkcy.). Subscribers may view the brief available within the full update.
WILMINGTON, Del. - Shareholders and directors of a company on June 11 filed a stipulation of settlement in a Delaware court in which the parties agreed that certain supplemental securities filings amounted to a fair and adequate solution to the shareholders' complaint regarding the sale of the company (In re Adolor Corporation Shareholders Litigation, No. 6997-VCN, Del. Chanc.).
WILMINGTON, Del. - The federal bankruptcy judge in the U.S. Bankruptcy Court for the District of Delaware presiding over the Chapter 11 proceeding of Allied Systems Holdings Inc. on June 12 granted the company interim approval of $20 million in post-petition financing (In Re: Allied Systems Holdings Inc., No. 12-11564, Chapter 11, D. Del. Bkcy.).
GREENBELT, Md. - A federal judge in Maryland on June 11 granted summary judgment in favor of the Pennsylvania Higher Education Assistance Agency (PHEAA) on a third-party complaint filed by a defendant student loan debtor who alleges that her loans are in default as a result of PHEAA's fraud and breach of contract (United States of America v. Cynthia Allen-Williams, No. 11-1001, D. Md.; 2012 U.S. Dist. LEXIS 80338).
SALT LAKE CITY - In a suit in which the receiver for a company that was operated as an alleged Ponzi scheme sued to recover commissions on real estate transactions related to the alleged scheme, a federal judge in Utah on June 11 granted summary judgment in favor of the defendants, ruling that the Texas Uniform Fraudulent Transfers Act (TUFTA) does not give the receiver the right to seek a judgment that would result in retention of value above what was initially contemplated by the transactions (Roger J. McConkie v. Rice Properties, et al., No. 09-00275, D. Utah; 2012 U.S. Dist. LEXIS 80902).
NEW YORK - Bankrupt financial company Residential Capital LLC (ResCap) and its affiliates on June 12 moved in the U.S. Bankruptcy Court for the Southern District of New York for approval of an $8.7 billion settlement agreement between ResCap and certain securitization trusts (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).
WASHINGTON, D.C. - A consumer has failed to meet the statutorily required findings of commonality, typicality or predominance in attempting to certify a class of consumers in an ATM fee lawsuit because he has failed to show that a class action is superior to other forms of adjudication, a federal judge in Washington ruled June 11 (Daniel E. Ballard v. Branch Banking and Trust Co., No. 11-1327, D. D.C.; 2012 U.S. Dist. LEXIS 80109).
WILMINGTON, Del. - A Delaware Chancery Court vice chancellor held June 11 that a shareholder was not in privity with a shareholder in a dismissed California federal case and that, therefore, the dismissal did not have a preclusive effect on the Delaware case (Louisiana Municipal Police Employees' Retirement System v. David Pyott, et al., No. 5795-VCL, Del. Chanc.).
DENVER - The 10th Circuit U.S. Court of Appeals on June 11 affirmed the dismissal of a suit in which a plaintiff accused OneWest Bank, which had acquired his loan after the failure of IndyMac Bank, of wrongfully foreclosing on his home, ruling that OneWest was "a holder of an evidence of debt" under Colorado law (Bruce C. McDonald v. OneWest Bank, No. 11-1071, 10th Cir.; 2012 U.S. App. LEXIS 11801).
WILMINGTON, Del. - A Delaware federal judge on June 11 granted requests to rehear arguments and alter his opinion confirming W.R. Grace & Co.'s Chapter 11 plan of reorganization and then filed an amended 228-page confirmation decision that also includes changes to reflect two recent federal circuit court rulings (In re: W.R. Grace & Co., et al. $(Garlock Sealing Technologies LLC, et al. v. W.R. Grace & Co., et al.$), No. 11-199, D. Del.; 2012 U.S. Dist. LEXIS 80461).
NEW YORK - The former independent outside auditor for The Bear Stearns Cos. Inc. agreed June 11 to pay nearly $20 million to settle shareholder claims that it failed to accurately monitor the financial giant's internal controls with regard to Bear Stearns' issuance of risky subprime mortgage-backed securities in violation of federal securities law (In re Bear Stearns Companies Inc. Securities, Derivative, and ERISA Litigation, MDL No. 08-md-1963, No. 08-2793, S.D. N.Y.).
SANTA ANA, Calif. - The receiver for Medical Capital Holdings Inc. (MedCap) said June 11 that he had reached a $106 million settlement with Wells Fargo Bank NA and Bank of New York Mellon (BNY Mellon), resolving allegations that the banks were complicit in MedCap's alleged Ponzi scheme (Securities and Exchange Commission v. Medical Capital Holdings Inc., et al., No. 09-00818, C.D. Calif.).
BOSTON - Dismissal of a shareholder class action lawsuit against Textron Inc. and certain of its executive officers was proper because the shareholders failed to plead a material misrepresentation or scienter in claiming that the defendants violated federal securities law, a First Circuit U.S. Court of Appeals panel ruled June 7 (Automotive Industries Pension Trust Fund v. Textron Inc., et al., No. 11-2106, 1st Cir.).
MILWAUKEE - The Official Committee of Unsecured Creditors in the Chapter 11 bankruptcy of the Catholic Archdiocese of Milwaukee on June 8 filed a supplemental brief in the U.S. Bankruptcy Court for the Eastern District of Wisconsin opposing the archdiocese's motion to withdraw certain claims (In Re: Archdiocese of Milwaukee, No. 11-20059, Chapter 11, E.D. Wis. Bkcy.).
WILMINGTON, Del. - A shareholder argues in a June 8 filing in a Delaware court that presuit demand to a board of directors would have been futile because a majority of the board is allegedly not disinterested (Joel A. Gerber v. EPE Holdings, LLC n/k/a Enterprise Products Holdings, LLC, et al., No. 3543-VCN, Del. Chanc.).
NEW YORK - The Police and Fire Retirement System (PFRS) of the City of Detroit on June 7 filed a brief in the Second Circuit U.S. Court of Appeals in the Chapter 11 bankruptcy of Ambac Financial Group Inc., contending that its appeal is valid due to what it calls Ambac's abandonment of the derivative claims PFRS brought prior to the bankruptcy filing (Public School Teachers' Pension & Retirement Fund of Chicago, et al. Ambac Financial Group Inc. $(In Re: Ambac Financial Group Inc.$), No. 11-4643, Chapter 11, 2nd Cir.).
PALM BEACH, Fla. - Luxury home builder Leonard Albanese on June 8 filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Southern District of Florida, listing more than $46.24 million in liabilities and $4.34 million in assets (In Re: Leonard Albanese, No. 12-24122, Chapter 11, S.D. Fla. Bkcy.).
PORTLAND, Ore. - An insurance agent was not acting as an investment adviser representative (IAR) under the terms of an endorsement to a professional liability insurance policy when she engaged in purported wrongful conduct, an Oregon federal magistrate judge ruled June 6, granting the insurer's motion for summary judgment in a garnishment lawsuit seeking recovery of a limited judgment entered against the agent (Jeffrey Walston, et al. v. National Union Fire Insurance Company of Pittsburgh, Pa., et al., No. 09-CV-122, D. Ore., Portland Div.).