SAN FRANCISCO - Affirming a lower court's dismissal of a shareholder derivative lawsuit, a Ninth Circuit U.S. Court of Appeals panel on April 2 said in an unpublished opinion that the shareholder did not show that presuit demand on a company's board of directors would have been futile (In re: International Game Technology Derivative Litigation, No. 10-16726, 9th Cir.; 2012 U.S. App. LEXIS 6582).
WILMINGTON, Del. - AFA Foods Inc., the meat-processing company that became associated with a ground beef additive known as "pink slime," filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the District of Delaware on April 2, citing decreasing demand for its product and unfounded public outcry over the additive (In Re: AFA Investment Inc., No. 12-11127, Chapter 11, D. Del. Bkcy.). Subscribers may view the filing in the full update.
HOUSTON - Arguing that a shareholder bringing a shareholder derivative lawsuit should not be allowed to voluntarily dismiss its suit without prejudice, directors and officers of a corporation urged a Texas federal court on March 29 to dismiss the suit with prejudice so the plaintiff could not move the case to a different forum (City of Sterling Heights Police & Fire Retirement System, Derivatively on behalf of Helix Energy Solutions Group, Inc. v. Owen Kratz, et al., No. 11-cv-02537, S.D. Texas).
SAVANNAH, Ga. - In a case in which a plaintiff sued the Federal Deposit Insurance Corp. in its capacity as receiver for a failed bank, asserting fraud, breach of contract and other allegations, a federal judge in Georgia on March 30 denied the plaintiff's motion to remand and granted the FDIC's motion for summary judgment, dismissing the suit (Lokey v. Federal Deposit Insurance Corp., et al., No. 11-00146, S.D. Ga.; 2012 U.S. Dist. LEXIS 45579).
CHICAGO - A federal judge in Illinois on April 2 denied a bank's motion to compel arbitration and stay proceedings in a suit in which a plaintiff alleges that the bank made unauthorized phone calls in an attempt to collect on a loan in violation of the Telephone Consumer Protection Act (TCPA) (Pereira v. Santander Consumer USA, Inc., No. 11-08987, N.D. Ill.; 2012 U.S. Dist. LEXIS 46155).
BOSTON - A Massachusetts federal judge on March 30 dismissed a purported class action by shareholders of Genzyme Corp., finding that the plaintiffs failed to show scienter that the company and its executives failed to disclose problems at manufacturing plants and with one of its biologic drugs and inflated the company stock price (In Re: Genzyme Corporation, No. 09-11267; John Rahn, et al. v. Genzyme Corporation, et al.; Vivian Oh, et al. v. Genzyme Corp., et al., No. 1:09-cv-11299, D. Mass., Boston Div.; 2012 U.S. Dist. LEXIS 44336).
NEW YORK - Pinnacle Airlines Corp., the parent company of Pinnacle Airlines and Colgan Air, filed for Chapter 11 bankruptcy on April 2 in the U.S. Bankruptcy Court for the Southern District of New York, citing losses from the high cost of fuel (In Re: Pinnacle Airlines Corporation, No. 12-11343, Chapter 11, S.D. N.Y. Bkcy.).
SAN FRANCISCO - A federal judge in California did not abuse his discretion in awarding summary judgment to a credit union in a Truth in Lending Act (TILA) lawsuit, a Ninth Circuit U.S. Court of Appeals panel ruled March 29 after finding that a man submitted a sham affidavit in opposition to the defendant's motion (Sylwester Slojewski v. Polam Federal Credit Union, No. 11-15018, 9th Cir.; 2012 U.S. App. LEXIS 6379).
NEW YORK - A New York federal judge overseeing the Pfizer Inc. securities multidistrict litigation on March 29 certified a class of shareholders who allege that their stock value was affected by misstatements and omissions concerning the safety of the pain drugs Celebrex and Bextra (In Re: Pfizer Inc. Securities Litigation, MDL Docket No. 1688, Nos. 04-cv-9866 and 05-md-1688, S.D. N.Y.; 2012 U.S. Dist. LEXIS 44330).
BOSTON - Shareholders in two similar and consolidated securities class action lawsuits against two companies that are the subject of a merger deal and a number of individual defendants have properly pleaded that the individual defendants breached their fiduciary duties in the planning and execution of the deal, a federal judge in Massachusetts ruled March 30 (In re PHC, Inc. Shareholder Litigation, No. 11-11049, D. Mass.; 2012 U.S. Dist. LEXIS 44616).
MINNEAPOLIS - Medtronic Inc. on March 30 said in a press release that it has agreed in principle to settle a stockholder class action involving its Infuse Bone Graft product for $85 million (Minneapolis Firefighters' Relief Association, et al. v. Medtronic, Inc., No. 08-6324, D. Minn.).
NEW YORK - Creditors of bankrupt grocery chain The Great Atlantic & Pacific Tea Co. on March 29 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York objecting to A&P's proposal to cure the amounts it owes them (In Re: The Great Atlantic & Pacific Tea Company Inc., No. 10-24549, Chapter 11. S.D. N.Y. Bkcy.). See related, 2011 U.S. Dist. LEXIS 131621.
HARRISBURG, Pa. - In a case in which a plaintiff says a credit union violated the Electronic Funds Transfer Act (EFTA) by charging him an ATM fee without posting a notice of the fee, a federal judge in Pennsylvania on March 28 granted the credit union's motion for summary judgment, finding that the plaintiff presented no evidence to support his allegations (Riviello v. Pennsylvania State Employees Credit Union, et al., No. 11-01533, M.D. Pa.; 2012 U.S. Dist. LEXIS 44025).
CHICAGO - In a putative class action in which a plaintiff says Target Corp. violated the Fair and Accurate Credit Transactions Act (FACTA) by including her credit card expiration date on receipts, a federal judge in Illinois on March 30 denied Target's motion for summary judgment, ruling that Target has not demonstrated that it did not provide the plaintiff with a receipt that displayed the expiration or, if it did, that it did not willfully violate FACTA (Todd v. Target Corp., No. 10-05598, N.D. Il.; 2012 U.S. Dist. LEXIS 44362).
SPRINGFIELD, Mass. - A federal judge in Massachusetts denied without prejudice certain corporate directors' and officers' motion to dismiss a shareholder derivative lawsuit on March 29, while allowing the shareholder to perform discovery to establish whether a special litigation committee was thorough, competent and acted in good faith (Aaron Sarnacki v. Michael F. Golden, et al., No. 11-cv-30009, D. Mass.; 2012 U.S. Dist. LEXIS 43991).
WASHINGTON, D.C. - The U.S. Supreme Court on April 2 denied review of a Third Circuit U.S. Court of Appeals ruling that a bankruptcy trustee failed to sufficiently allege that lenders violated the Sherman Act by conspiring to determine the terms on which they would provide financing to a garment retailer (Jeoffrey L. Burtch v. Milberg Factors, Inc., et al., No. 11-932, U.S. Sup.).
WASHINGTON, D.C. - The U.S. Supreme Court on April 2 denied a petition filed by indirect purchasers of diamonds seeking review of a divided en banc Third Circuit U.S. Court of Appeals' ruling reinstating a $295 million settlement of a class action lawsuit that alleged that De Beers companies fixed prices in the wholesale market for gem-quality diamonds (David T. Murray, et al. v. Shawn Sullivan, et al., No. 11-1111, U.S. Sup.).
NEW YORK - A New York state court judge on March 28 dismissed a securities lawsuit seeking to intervene in Bank of America's $8.5 billion settlement over Countrywide Home Loans Inc.'s sale of subprime residential mortgage-backed securities, ruling that the pooling and servicing agreement for the securities bars the plaintiffs from bringing the action (Walnut Place LLC, et al. v. Countrywide Home Loans Inc., et al., No. 650497/2011, N.Y. Sup., New York Co.).
HOUSTON - Participants in BP's retirement plans failed to overcome the presumption that the plans' investment in company stock was prudent, even after the Deepwater Horizon explosion and uncontained oil spill, a federal judge in Texas ruled March 30 in dismissing the participants' breach of fiduciary duty claims under the Employee Retirement Income Security Act (In re: BP p.l.c. ERISA Litigation, No. 4:10-cv-4214, S.D. Tex.; 2012 U.S. Dist. LEXIS 44801).
WASHINGTON, D.C. - The U.S. Supreme Court on April 2 granted the U.S. solicitor general leave to participate in oral arguments in a case in which a creditor bank argues that the Bankruptcy Code precludes confirmation of a hotel chain's Chapter 11 plan that proposes to sell collateral free and clear of liens without allowing the bank to credit bid (RadLAX Gateway Hotel LLC v. Amalgamated Bank, No. 11-166, Chapter 11, U.S. Sup.).
PHILADELPHIA - The Third Circuit U.S. Court of Appeals on March 28 granted West Penn Allegheny Health System Inc.'s motion for disqualification of the judge in the hospital's antitrust action against the University of Pittsburgh Medical Center Inc. (UPMC) (In re: West Penn Allegheny Health System, Inc., No. 12-1550, 3rd Cir.). Subscribers may view the order within the full update.
NEW YORK - A federal judge in New York on March 29 ruled that the U.S. Bankruptcy Court for the Southern District of New York is the proper jurisdiction for claims of fraudulent conveyance brought by the liquidating trustee in the Chapter 11 proceeding of Lyondell Chemical Co. (Edward S. Weisfelner v. Leonard Blavatnik [In Re: Lyondell Chemical Company] and Edward S. Weisfelner v. NAG Investments LLW, Nos. 11-8251 and 11-8445, Chapter 11, S.D. N.Y.).
SANTA ANA, Calif. - Directors and officers of a corporation argued in a California federal court on March 30 that a shareholder derivative lawsuit should be dismissed because, among other reasons, the directors and officers are protected by the business judgment rule (In re Smith Micro Software, Inc. Shareholder Derivative Litigation, No. 11-cv-1394, C.D. Calif.).
SAN FRANCISCO - Purchasers of Cipro on March 27 filed their opening brief urging the California Supreme Court to review the Court of Appeal's ruling that pay-for-delay settlement agreements between the manufacturer of a branded antibiotic and its generic competitors do not violate California antitrust laws (In re Cipro Cases I & II, No. S198616, Calif. Sup.). See related, In re Cipro Cases I & II.