NEW ORLEANS - A disability insurer did not act arbitrarily and capriciously by relying on emails furnished by a plan participant's acquaintance in determining that the participant was no longer disabled, the Fifth Circuit U.S. Court of Appeals ruled Sept. 6, saying that the insurer did not have an affirmative duty to investigate the accuracy of the emails under the Employee Retirement Income Security Act (Terri Truitt v. Unum Life Insurance Company of America, No. 12-50142, 5th Cir.; 2013 U.S. App. LEXIS 18639).
NEW YORK - Two shareholders in a company told a New York federal court on Sept. 6 that a settlement of a shareholder derivative lawsuit against the company's directors and officers will confer substantial benefit to the company and the shareholders and should be approved by the court (Catherine Rubery, Derivatively on Behalf of E*Trade Financial Corporation v. Mitchell H. Caplan, et al., No. 07-cv-8612, S.D. N.Y.).
NEW YORK - The Dewey & LeBoeuf LLP Secured Lender Trust on Sept. 10 filed a brief in the Chapter 11 bankruptcy of AMR Corp., contending that it is entitled to more than $4.61 million in fees and expenses for its role as special counsel to AMR (In Re: AMR Corporation, No. 12-12321, Chapter 11, S.D. N.Y. Bkcy.).
CHICAGO - A plan sponsor did not wrongfully deny health insurance benefits or breach its fiduciary duties under the Employee Retirement Income Security Act to a former employee whose employment was terminated because his work-related injuries prevented him from returning to work where the plan terms did not promise post-employment benefits, the Seventh Circuit U.S. Court of Appeals ruled Sept. 6 (James Brooks v. Pactiv Corporation, et al., No. 12-1155, 7th Cir.; 2013 U.S. App. LEXIS 18651).
TRENTON, N.J. - Despite winning summary judgment that it is the owner of the "Blue Ridge Farms" trade name and a related logo, a plaintiff failed to secure summary judgment of infringement by a defendant competitor on Sept. 9 (Fresh Prepared Foods Inc. v. Farm Ridge Foods LLC et al., No. 10-6310, D. N.J.).
RALEIGH, N.C. - A computer security expert need not be a forensic computer analyst to opine that the only physical evidence linking a man to his wife's murder was tampered with, a North Carolina Court of Appeals panel held Sept. 3 in finding that the trial judge wrongly limited the expert (State of North Carolina v. Bradley Graham Cooper, No. COA12-926, N.C. App.; 2013 N.C. App. LEXIS 936).
NEW YORK - A shareholder in a derivative lawsuit against a company's directors and officers said Sept. 3 that the company's board of directors' investigation into the shareholder's presuit demand was biased and insufficient (Ernesto Espinoza, Derivatively on Behalf of JPMorgan Chase & Co. v. James Dimon, et al., No. 13-cv-02358, S.D. N.Y.).
NEW YORK - Dismissal of a securities class action lawsuit stemming from Bernard L. Madoff's massive Ponzi scheme is proper, a federal judge in New York ruled Sept. 3, because policyholders' claims are preempted by the Securities Litigation Uniform Standards Act (SLUSA) (In re Tremont Securities Law, State Law and Insurance Litigation, No. 08-11117, S.D. N.Y.).
NEW ORLEANS - A federal district court erred in ruling that the court-appointed receiver for Stanford Group Co. and certain of its related entities is not bound by any arbitration agreements in a securities suit seeking to recoup millions of dollars in allegedly fraudulent transfers as part of R. Allen Stanford's massive Ponzi scheme, a Fifth Circuit U.S. Court of Appeals panel ruled Aug. 30 (Ralph S. Janvey v. James R. Alguire, et al., No. 11-10838, 5th Cir.; 2013 U.S. App. LEXIS 18181).
NEW YORK - Syncora Guarantee Inc. filed a brief supporting its proof of claim in the Chapter 11 bankruptcy of Residential Capital LLC (ResCap) on Sept. 3, arguing that it insured more than $800 million in residential mortgage-backed securities (RMBS) under an agreement that GMAC Mortgage LLC (GMACM) - a division of ResCap - would comply with its obligations pursuant to a covenant between Syncora and GMACM (In Re: Residential Capital LLC, No. 12-12020, Chapter 11, S.D. N.Y. Bkcy.).
NEW ORLEANS - The Fifth Circuit U.S. Court of Appeals on Aug. 27 ruled 2-1 that former employees' deferred compensation arrangements did not constitute Employee Retirement Income Security Act-governed plans because they did not require "an ongoing administrative scheme" (Carol A. Cantrell, et al. v. Briggs & Veselka Company v. Cantrell & Cowen, P.L.L.C., No. 12-20294, 5th Cir.; 2013 U.S. App. LEXIS 17922).
BOISE, Idaho - The Idaho Supreme Court on Aug. 27 overturned summary judgment for the defendant in a product liability action, pointing out that the plaintiff's expert opined that a pepper spray product may have caused a prison worker's respiratory injury (Billie Jo Major v. Security Equipment Corp., No. 39414, Idaho Sup.; 2013 Ida. LEXIS 261).
NEW YORK - A lump-sum payment by a plaintiff's former employer in exchange for the plaintiff agreeing to withdraw his complaint qualifies as wages under the Federal Insurance Contributions Act (FICA) and is subject to FICA taxes, the Second Circuit U.S. Court of Appeals ruled Aug. 27 (Chester Gerstenbluth v. Credit Suisse Securities $(USA$) LLC, et al., No. 12-4125, 2nd Cir.; 2013 U.S. App. LEXIS 17841).
SEATTLE - The Employee Retirement Income Security Act completely preempts a claim that an insurer violated the Washington Insurance Fair Conduct Act by denying a claim for benefits under an employer-sponsored life insurance plan, a federal judge in Washington ruled Aug. 23 (Alan Chan, et al. v. Prudential Insurance Company of America, No. 12-524, W.D. Wash.; 2013 U.S. Dist. LEXIS 120428).
BOSTON - A federal judge in Massachusetts on Aug. 27 dismissed a man's lawsuit seeking to enjoin foreclosure on his home after finding that while he was a victim of a foreclosure scheme and was fraudulently induced into obtaining the mortgage loan securing his home, he only had standing to challenge whether the mortgage loan at issue was voidable rather than void (Guy Giuffre v. Deutsche Bank National Trust Co., et al., No. 12-11510-JLT, D. Mass.; 2013 U.S. Dist. LEXIS 121816).
CINCINNATI - A federal judge in Ohio did not abuse his discretion in dismissing a shareholder class action lawsuit against a video game maker and others for alleged federal securities law violations because the shareholder failed to properly plead scienter, a Sixth Circuit U.S. Court of Appeals panel ruled Aug. 27 (Bruce E. Ricker v. Zoo Entertainment Inc., et al., No. 12-3951, 6th Cir.).
WASHINGTON, D.C. - The U.S. Supreme Court on Aug. 26 dismissed a petition for writ of certiorari appealing a First Circuit U.S. Court of Appeals ruling in a shareholder derivative lawsuit that sought determination as to whether the Circuit Court abused its discretion in ruling that shareholders had shown that demand on investment funds' boards of directors was futile (UBS Financial Services Inc. of Puerto Rico, et al. v. Union de Empleados de Muelles de Puerto Rico PRSSA Welfare Plan, et al., No. 12-1208, U.S. Sup.).
SPRINGFIELD, Mass. - A shareholder told a Massachusetts federal court on Aug. 26 that a motion to dismiss a shareholder derivative lawsuit based on the findings of an allegedly biased special litigation committee should not be granted (Aaron Sarnacki v. Michael F. Golden, et al., No. 11-cv-30009, D. Mass.).
GRAND RAPIDS, Mich. - A federal judge in Michigan on Aug. 23 ruled that an executive who claimed that he was terminated because he threatened to report that the company's 401(k) plan was paying excessive fees failed to establish retaliatory discharge in violation of the Employee Retirement Income Security Act, but the judge ordered the plan fiduciaries to pay restitution to remedy their breach of fiduciary duties in allowing such fees to be paid (Charles Huizinga v. Genzink Steel Supply & Welding Co., et al., No. 1:10-CV-223, W.D. Mich.; 2013 U.S. Dist. LEXIS 119942).
SANTA ANA, Calif. - Dismissal of a shareholder's federal securities law claims is proper, a federal judge in California ruled Aug. 23, because he failed to show that a drug company and certain of its senior officers acted with the requisite scienter in misrepresenting the clinical results of a cancer drug it was developing (Nathaniel L. Anderson v. Peregrine Pharmaceuticals Inc., et al., No. 12-1647, C.D. Calif.; 2013 U.S. Dist. LEXIS 120419).
NEW YORK - Shareholders in a financial company countered certain of the company's directors' and officers' motion to dismiss a derivative lawsuit on Aug. 23, claiming that the shareholders adequately showed that presuit demand upon the company's board would have been futile (In re JPMorgan Chase & Co. Derivative Litigation, No. 12-cv-03878, S.D. N.Y.).
SEATTLE - Participants in a defined benefit plan sponsored by Weyerhaeuser Co. have standing to pursue claims for injunctive relief but do not have standing to bring legal claims for monetary relief related to their allegations that the company and its investment managers violated the Employee Retirement Income Security Act by investing in a large number of alternative investments that allegedly contributed to the plan's losing approximately $2.4 billion in 2008, a federal judge in Washington ruled Aug. 23 (Michael Palmason v. Weyerhaeuser Company, et al., No. 2:11-cv-00695-RSL, W.D. Wash.; 2013 U.S. Dist. LEXIS 120424).
SAN FRANCISCO - A group of shareholders asked a California federal court on Aug. 22 to give final approval to a settlement with a company's directors and officers that implements corporate governance measures that address certain alleged wrongdoing (Scott Ozaki, derivatively on behalf of Oracle Corporation, et al. v. Lawrence J. Ellison, et al., No. 11-cv-04493, N.D. Calif.).
SEATTLE - Plaintiffs in a shareholder derivative lawsuit against a company's directors and officers asked a Washington federal court on Aug. 22 to give final approval to a $2.75 million settlement of the case (Alan Hopkins v. HQ Sustainable Maritime Industries, Inc., et al., No. 11-cv-00910, W.D. Wash.).
YOUNGSTOWN, Ohio - A federal judge in Ohio on Aug. 23 granted a pair of motions to vacate prior rulings in a securities class action lawsuit against Freddie Mac and certain of its former executive officers, ruling that vacating the rulings is warranted to remove any appearance of partiality (Ohio Public Employees Retirement System, et al. v. Federal Home Loan Mortgage Corp., et al., No. 08-0160, N.D. Ohio; 2013 U.S. Dist. LEXIS 120258).