NEW YORK - Former CEO of bankrupt MF Global Holdings Ltd. (MFGH) Jon S. Corzine, along with other principals in MFGH, on Feb. 4 filed a brief in the U.S. Bankruptcy Court for the Southern District of New York, contending that the trustee in the Securities Investor Protection Act (SIPA) litigation related to MFGH's affiliate MF Global Inc. should not be permitted to decommission computers because it will interfere with discovery being conducted in related litigation (In Re: MF Global Inc., No. 11-2790, Chapter 11, S.D. N.Y. Bkcy.).
SAN FRANCISCO - United Airlines Inc.'s sick leave plan and trust is not an employee benefits plan governed by the Employee Retirement Income Security Act and, therefore, is subject to California's Kin Care Law, which requires employers who provide paid sick leave to their employees to use sick leave to care for family members, a California appellate court ruled Jan. 31 (Airline Pilots Association International, et al. v. United Airlines, Inc., No. A129914, Calif. App., 1st App. Dist., Div. 4; 2014 Cal. App. LEXIS 100).
CHARLOTTESVILLE, Va. - A community bank and one of its shareholders agreed on Feb. 4 to settle claims filed in Virginia federal court that the bank and others breached their fiduciary duty in negotiating a merger deal with another community bank in violation of federal securities law (Jacklyn Crescente v. StellarOne Corp., et al., No. 10-0021, W.D. Va.).
PHILADELPHIA - A divided Second Circuit U.S. Court of Appeals on Feb. 4 reversed a finding that the Employee Retirement Income Security Act did not preempt a Vermont state law requiring health insurers to provide information for the state's health care database (Liberty Mutual Insurance Co. v. Susan L. Donegan, in her capacity as the commissioner of the Vermont Department of Financial Regulation, No. 12-4881, 2nd Cir.; 2014 U.S. App. LEXIS 2088).
NEW YORK - Morgan Stanley will pay $1.25 billion to settle claims that it, certain of its subsidiaries and others misrepresented the investment quality in more than $10.58 billion in certificates in connection with 33 securitizations of residential mortgage-backed securities Morgan Stanley sold to Fannie Mae and Freddie Mac, according to Securities and Exchange Commission documents filed Feb. 4 (Federal Housing Finance Agency, as Conservator for Fannie Mae and Freddie Mac, v. Morgan Stanley, et al., No. No. 11-6739, S.D. N.Y.).
NEW YORK - The growing end of financial crisis-era litigation resulted in a continued drop in the overall number of new securities and business litigation filings in 2014 for the second year in a row, while the average settlement amount in such cases was the highest it's been in five years, according to a report issued Feb. 3 by insurance industry analyst Advisen Ltd.
NEW YORK - A federal district court did not err in dismissing a shareholder class action lawsuit against an oil company and others, a Second Circuit U.S. Court of Appeals panel ruled Feb. 3, agreeing substantially with the district court's findings (Samuel Sinay, etc. v. CNOOC Ltd., et al., No. 13-2240, 2nd Cir.; 2014 U.S. App. LEXIS 2010).
CINCINNATI - A panel of the Sixth Circuit U.S. Court of Appeals on Feb. 3 remanded a case to a district court with instructions that it should enter judgment in favor of a debtor who sued his former employer alleging violations of the Employee Retirement Income Security Act of 1974 when it denied him long-term disability benefits. The panel also ruled that the debtor's lawsuit was not barred by judicial estoppel despite the fact that he failed to list it in his bankruptcy schedules when he filed his petition (Nilratan Javery v. Lucent Technologies Inc., No. 12-3834, Chapter 13, 6th Cir.; 2014 U.S. App. LEXIS 1992).
DETROIT - A federal judge in Michigan on Jan. 31 granted the Securities and Exchange Commission's request for monetary relief of more than $121 million in a Ponzi scheme lawsuit, ruling that the SEC's request was proper and adequate (United States Securities and Exchange Commission v. Joseph Paul Zada, et al., No. 10-14498, E.D. Mich.; 2014 U.S. Dist. LEXIS 12067).
WILMINGTON, Del. - A plaintiff in a shareholder derivative lawsuit, who stopped being a shareholder in a company after the company went private, told a federal court in Delaware on Feb. 3 that he still has standing to bring a suit against certain of a company's directors and officers (Philip Halpert, derivatively on behalf of AsiaInfo-Linkage, Inc. v. Steve Zhang, et al., No. 12-cv-1339, D. Del.).
SEATTLE - The State of Washington's discretionary clause ban applies to any final denial of benefits that occurs after the ban's effective date, even if the plan under which the denial was issued took effect before the ban's effective date, a federal judge in Washington ruled Jan. 29 in ruling that de novo review applied to a denial of disability benefits under a plan governed by the Employee Retirement Income Security Act (Korri Marie Treves, et al. v. Union Security Insurance Company, LLC, et al., No. 12-1337, W.D. Wash.; 2014 U.S. Dist. LEXIS 11905).
ROCKFORD, Ill. - The Employee Retirement Income Security Act does not preempt an employer's counterclaim for unjust enrichment under Illinois state law against former employees who did not reimburse the employer for health insurance premium payments the employer made during the former employees' extended medical leave, a federal judge in Illinois ruled Jan. 30 (Daniel A. Madero v. Peters Engineering, Inc., et al., No. 12 C 50157, N.D. Ill.; 2014 U.S. Dist. LEXIS 11403).
NEW YORK - A federal district court did not err in dismissing a shareholder derivative lawsuit because the shareholder failed to show that The Goldman Sachs Group Inc. was a "statutory insider" at the time of the sale and purchase of certain short call options, a Second Circuit U.S. Court of Appeals panel ruled Jan. 29 (Andrew E. Roth, derivatively on behalf of Leap Wireless International Inc., v. The Goldman Sachs Group Inc., et al., No. 12-2509, 2nd Cir.).
CHICAGO - A federal judge in Illinois on Jan. 28 gave final approval to a $20 million settlement of a shareholder derivative lawsuit in which the shareholder had accused an education company's directors and officers of breaching their fiduciary duties (Amy Cook v. Gary E. McCullough, et al., No. 11-cv-09119, N.D. Ill.).
MINNEAPOLIS - A shareholder of Target Corp. sued certain directors and officers of Target on Jan. 28, alleging that they are responsible for a large security data breach of consumers' personal credit information (Mary Davis, Derivatively on Behalf of Target Corporation v. Gregg W. Steinhafel, et al., No. 14-cv-00261, D. Minn.).
NEW YORK - A federal judge in New York did not err in dismissing a shareholder's securities lawsuit against the Federal Reserve Bank of New York (FRBNY) because its acquisition of American International Group (AIG) during the financial crisis did not violate Delaware fiduciary duty law, a Second Circuit U.S. Court of Appeals panel ruled Jan. 29 (Starr International Co. Inc., individually and derivatively on behalf of American International Group Inc. v. Federal Reserve Bank of New York, et al., No. 12-5022, 2nd Cir.).
NEW YORK - A Second Circuit U.S. Court of Appeals panel on Jan. 27 partially overturned a federal district court's dismissal of a securities lawsuit accusing a company's officers and directors of engaging in a market manipulation and insider trading scheme, ruling that the district court erred in dismissing the insider trading claims (Gloria Steginsky v. Xcelera Inc., et al., Nos. 13-1327 and 13-1892, 2nd Cir.; 2014 U.S. Dist. LEXIS 1523).
CHICAGO - A Seventh Circuit U.S. Court of Appeals panel on Jan. 24 affirmed the dismissal of an Employee Retirement Income Security Act class complaint filed against a railroad and a union following a change in representation and wage and benefits package (Teamsters Local Union No. 705, et al. v. Burlington Northern Santa Fe, LLC, et al., No. 11-3705, 7th Cir.; 2014 U.S. App. LEXIS 1476).