LexisNexis® Legal Newsroom
When the Truth Emerges, No Price Drop Equals No Loss Causation

The Ninth Circuit upheld a ruling concluding that plaintiffs failed to establish loss causation in an action where the share price did not decline following the emergence of the truth in a Securities Act Section 12(2) action. Miller v. Thane International, Inc. , Case No. 09-55474 (9th Cir. Aug....

Inadequate Loan Loss Reserve Disclosure Case Dismissed

In a recent post , I discussed several recent decisions in which securities cases involving failed or troubled banking institutions survived dismissal motions. By contrast, however, in an August 16, 2010 ruling ( here ), Southern District of New York Judge Robert Patterson, Jr. granted the defendants'...

A Financial Fraud Action Centered on a Fictitious Customer

The SEC filed an amended complaint, adding Jon Latorella and James Fields as defendants to an action alleging a financial fraud and stock manipulation involving two companies they control. SEC v. LocatePlus Holdings Company , Case No. 1:10-cv-11751 (D. Mass. Nov. 11, 2010) ( previously discussed ...

Stay on Target

Don't stray from your investment strategy. Don't chase yields. Make sure your investment strategy follows your marketing materials. According to SEC charges, Charles Schwab failed to do this with its YieldPlus Fund in 2007. The fund was marketed as a Short Term Bond fund and described the...

This Week in Securities Litigation (April 8, 2011)

Prosecutors concluded their case-in-chief in the Galleon insider trading trial this week. SEC enforcement, in conjunction with the U.S. Attorney's Office in New Jersey, brought an insider trading case against an attorney, a former associate of three prominent law firms, and a professional trader...

$37M Settlement Reached in Tronox Investor Class Action Lawsuit

NEW YORK - (Mealey's) Shareholders and defendants in a securities class action lawsuit against a chemical company, certain of its officers and directors and others have agreed to a $37 million settlement of all federal securities law claims, according to court documents made available on August...

SEC Settles With Former IndyMac CEO After Dropping Most Claims

One of the Commission's significant market crisis cases arose out of the collapse of IndyMac Bancorp, Inc. SEC v. Perry, Civil Action No. CV 11-01309 (C.D. Cal. Filed Feb. 11, 2011). The complaint named as defendants Michael Perry, former CEO and Chairman of the bank, and A. Scott Keys, the former...

FDIC Files First Suit Against Failed Bank's Accountants

On November 1, 2012, in what is the first lawsuit the FDIC has filed as part of the current bank failure wave against a failed bank's accountants, the FDIC, as receiver for the failed Colonial Bank, has filed an action in the Middle District of Alabama against Pricewaterhouse Coopers and Crowe Horwath...

SEC Secures $2.7 Million Judgment Against Broker and Others

The Commission prevailed on a motion for summary judgment against a brokerage firm, its principle and a former managing director, ultimately securing judgments of over $2.7 million. SEC v. Constantin, Civil Action No. 11-CV-4642 (S.D.N.Y. Filed July 6, 2011). This is one of what may be an increasing...

Ontario Securities Suit Claimants Denied Leave to Proceed

Shareholder claimants seeking to pursue a misrepresentation claim under the Ontario Securities Act must obtain leave of court to proceed based on a statutory requirement that the plaintiff must show a “reasonable possibility that the action will be resolved at trial in favor of the plaintiff.”...

CEO, CFO Named in SEC Actions For Concealing Control Problems

The co-founders of a Florida based computer company were names as Respondents in SEC administrative proceedings. The actions centers on significant internal control difficulties regarding the inventory which, rather than being remedied, were concealed by from the auditors and misrepresented in filings...

SEC Charges Oil and PR Firms and Their Executives With Fraud

An energy company, its CEO and the firm’s public relations adviser and its president were named in a fraud action by the SEC centered on false representations concerning oil reserves for a property in Columbia. The representations were used to sell securities and boost the price of the oil company...