Fraudulent investment funds purporting to give the public
an opportunity to acquire pre-IPO shares of potentially hot stocks such as
Facebook have been front and center in the District Court in Manhattan in
recent days. In one case a former Oregon...
Money market reform, a cause long championed by SEC Chairman Mary Schapiro, will not go forward at this time. The Chairman was unable to secure the necessary votes to issue proposed regulations for comments after two and one half years of study. The Chairman...
During 2011, plaintiffs filed a wave of securities class
action lawsuits against U.S.-listed Chinese companies. There were 39 of these
lawsuits filed in 2011 (out of 218 total securities class action lawsuit
filings in 2011), as discussed here .
Raj Rajaratnam, the founder of the Galleon Group hedge
fund lost his appeal on insider trading charges. U.S. v. Rajaratnam, Docket
No. 11-4416-cr (2 nd Cir. Decided: June 24, 2013). Mr. Rajaratnam was
convicted on five counts of conspiracy to commit...
The following is a general summary of § 262 of the DGCL.
The rights and obligations of stockholders and companies will vary depending
upon the circumstances of the particular merger. The appraisal process under §
262 of the DGCL, however...
This is the fifth in a series of articles examining the creation of the Financial Reporting and Audit Task Force along with a Center for Risk and Quantitative Analysis. Today’s article examines select cases brought in the wake of Chairman Levitt’s...
As a quick follow up on this topic from a few months ago
(prior post can be read here ),
has approved alternatives to Nasdaq's historical $4 minimum bid price
listing standard. Under the new alternative listing standards, a security
This is the first of a four part series projecting the path of SEC Enforcement.
SEC Enforcement is in transition. The agency has a new Chair, new Commissioners and a new Director of the Division of Enforcement. Aggressive new approaches have been outlined...
The Green Bay Packers want to expand Lambeau Field by
6,700 seats, add new gates and new video boards. To finance the improvements,
the team ownership decided to sell additional stock in the ownership
corporation. Since the Kraft family...
The Language of Value
posted by 10/11/2010
Shakespeare may have been right that a rose will emit the
same fragrance whatever you call it, but when it comes to concepts such as
"value," the choice of words can matter. In order to discuss...
LexisNexis Overview: There was no allegation that an investment advisor
filed prospectuses and falsely attributed them to a mutual fund, nor did the
prospectuses indicate that they came from the advisor instead of the fund;
thus, the advisor did not "make"...
This week the SEC proposed new rules regarding asset backed
securities while Chairman Mary Schapiro, in an op-ed article in the Washington
Post, called for the Senate financial reform bill to be strengthened. SEC
enforcement saw another of its proposed...
In a likely unprecedented move, the Securities and
Exchange Commission ("SEC") filed
a lawsuit against the Securities Investor Protection Corporation
("SIPC") as the culmination of a six-month effort to force SIPC to
The SEC won a significant victory in the Fifth Circuit Court of
Appeals . The court reversed the Commission's high profile loss ( here ) in its
insider trading case against entrepreneur and Dallas Mavericks owner Mark
Cuban. SEC v. Cuban , No....
Wait ... this is unusual. According to a piece by Tom Hals of Reuters , the lead plaintiff - not his
lawyer, but the lead plaintiff himself - is opposing settlement of the
shareholder litigation in the J Crew transaction. The J Crew MBO was on the
This article focuses on the enforceability of "no shop" provisions that prohibit a target company from soliciting or encouraging third-party bids after signing an agreement with a prospective purchaser, and "no talk" provisions, that...
When operating under the Section 3(c)(7) exemption from the Investment Company Act, the issue then becomes how a private investment fund can provide an equity ownership to key employees. Its unlikely that your key employees will have the $5 million in...
The Depository Trust Company (DTC) effectively controls
which public companies' stock can be traded electronically as opposed to
exchanging actual stock certificates when sales take place. A company must
apply to DTC to obtain this ability. Higher...
A complaint brought by closed end
fund Gabelli Global Multimedia Trust, Inc. alleging violations of the
anti-pyramiding provisions of the Investment Company Act was dismissed for a
lack of standing. The defendants were Arthur Lipson and a group of...
Preliminary Note: The requirements of this Rule are in addition to other existing member obligations under FINRA rules and the federal securities laws, including obligations to determine suitability of particular securities transactions with customers...
The distinction between primary and secondary liability in securities fraud suits has been a key issue since the Supreme Court handed down its decision in Central Bank of Denver v. First Interstate , 511 U.S. 164 (1994). Although the SEC had its authority...
In November, 2009 the Organization for Economic and Co-operation and Development (OECD)
announced a new recommendation at the OECD's celebration of "International
Anti-Corruption Day" and the Tenth Anniversary of the " Entry into...
Overview: Where foreign shareholders alleged that respondents violated § 10(b) of
the Securities and Exchange Act of 1934 and SEC Rule 10b-5 regarding
securities traded on foreign exchanges, dismissal was warranted because §
At its April 7,
2010 meeting the United States Sentencing Commission approved amendments to its
Sentencing Guidelines . The next
day on April 8, 2010, the UK Bribery
Bill received Royal Assent. These two events follow the December 9, 2009
The SEC brought a fraud action against a company and its
Chairman and President for defrauding company shareholders out of more than
$110 million in the sale of their shares to the company by paying prices which
were as much as 300% under value. The...