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Trends In Canadian Securities Class Action

Filings for new Canadian securities class actions have been essentially flat over the last three years, according to a recent report by NERA Economic consulting ( here ). That trend is consistent with the one for the filing of U.S. class actions ( here ). Last year there were 11 securities class actions...

Thinking About Bondholder Securities Class Actions

When the topic is securities class action litigation, what is usually considered are lawsuits brought under the federal securities laws by shareholders. By way of illustration, when considering the extent of a company’s potential exposure to a future securities class action lawsuit, the starting...

Life Sciences Companies and Securities Litigation: 2014 Update

Life sciences companies are “an increasingly popular target” of securities class action lawsuits, according to the annual securities litigation survey from the David A. Kotler of the Dechert law firm. According to the March 16, 2015 report, entitled “Dechert Survery of Securities Fraud...

Why Are Investors Seeking Litigation Funding Opportunities? Because Litigation Funding is Profitable

In a March 9, 2015 article entitled “Hedge Fund Manager’s Next Frontier: Lawsuits” ( here ), the Wall Street Journal described how the “next act” for EJF Capital LLC, a hedge fund run by Friedman, Billings, Ramsay Group’s former co-founder Emmanuel Friedman , will...

Yet Another U.S. Securities Suit Arising From a Latin American Corruption Investigation

In yet another U.S. securities class action lawsuit involving a non-U.S. company and a corruption investigation in the company’s home country, on March 19, 2015 a shareholder of Chemical & Mining Company of Chile, Inc. ( Sociedad Quimica y Minera de Chile, S.A, or SQM), the world’s largest...

Cornerstone Research: Average and Aggregate Securities Suit Settlements Plunged in 2014

The aggregate amount of all securities class action settlements during 2014 declined to the lowest level in years and there also was a “dramatic” decrease in the average securities suit settlement amount during the year, according to a March 24, 2014 report from Cornerstone Research. The...

U.S. Supreme Court Applies Reasonable Basis Standard for Statements of Opinion

WASHINGTON, D.C. — (Mealey’s) The U.S. Supreme Court on March 24 reversed and remanded a Sixth Circuit U.S. Court of Appeals opinion in a securities class action lawsuit that determined that a company’s executive officers may be held liable for statements made to investors that later...

Omnicare: Section 11 Liability and Opinions

The Supreme Court defined the circumstances under which liability can be imposed for opinion statements under Securities Act Section 11. Specifically, the Court held that such liability could be imposed on two theories: One focuses “on what the statement says and the other on what it leaves out...

Facts, Opinions, Omissions, and Context: The U.S. Supreme Court Issues Omnicare Opinion

In a March 24, 2015 opinion in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund ( here ), the U.S. Supreme Court set aside the Sixth Circuit’s ruling that allegations of “objective falsity” were sufficient to make a statement of opinion in securities offering...

More Class Actions Claim GAAP Violations, Less Paralleled by SEC Case

Last year the number of securities class action cases settled remained largely constant compared to the prior year, according to a report by Cornerstone Research ( here ). At the same time the number of cases alleging GAAP violations increased, although only a small percentage involved restatements....

IMHO, Omnicare Doesn’t Materially Change Opinion Disclosure

On March 24, the U.S. Supreme Court issued its anticipated Omnicare decision, which addresses the standard of liability applied to expressions of opinion in a registration statement for a public offering [lexis.com subscribers may access Supreme Court briefs and an enhanced opinion for this case]. While...

Cornerstone Research: Accounting-Related Securities Suits Jump in 2014

The number of securities class action lawsuit filings raising accounting allegations rose by 47 percent in 2014 compared to the prior year, according to a new report from Cornerstone Research. The March 31, 2015 report, entitled “Accounting Class Action Filings and Settlements: 2014 Review and...

Accounting Cases – An SEC Priority, but the Cases Being Filed Are Class Actions

Accounting and financial fraud cases are an SEC priority. The cases, however, are being brought by the private bar as class actions. The number of accounting class actions filed last year increased by 47% compared to the prior year despite the fact that the number of securities class actions filed was...

The Curse of Multi-Jurisdiction Litigation: A Problem for Everyone, Not Just Defendants

One of the more distinct litigation phenomena in recent years has been the rise of multi-jurisdiction litigation, particularly in connection with merger objection litigation. Corporate advocates and defense attorneys have decried this development, as it has forced companies facing litigation to have...

PwC Report Reviews 2014 Securities Suit Filings and Settlements, Analyzes Trends Likely to Drive Future Suits

On April 10, 2015, PwC released the latest in what is now a series of annual securities class action litigation reports. PwC’s report is generally consistent with the reports previously published by Cornerstone Research and NERA. What makes the PwC report noteworthy is its commentary on the trends...

Are Event Studies in Securities Litigation Reliable?

In its June 2014 opinion in the Halliburton case, the U.S. Supreme Court held that securities lawsuit defendants may introduce evidence at the class certification stage to try to show that the alleged misrepresentation on which the plaintiffs rely did not impact the defendant company’s share price...

Advisen Report: Decline in Corporate and Securities Lawsuit Filings Continued in First Quarter

The recent trend toward declining numbers of corporate and securities lawsuit filings continued in the first quarter of 2015, according to a report from the insurance industry information firm, Advisen. If the level of activity in the year’s first quarter were to continue for the rest of the year...

Securities Suits Hit Companies Using Stock Promoters

When plaintiffs’ lawyers filed a complaint against the company earlier this week, Cellular Biomedicine Group became the latest firm to be hit with a securities class action lawsuit relating to the company’s alleged use of a stock promotion firm. There were a number of companies hit with similar...

New Supreme Court Case Could Have Huge Impact on Class Action Litigation

On April 27, 2015, in a development that could have significant implications for a wide variety of class action lawsuits, the United States Supreme Court granted the petition of for a writ of certiorari of online search firm Spokeo. The cert grant sets the stage for the Court to consider whether Congress...

Supreme Court Vacates Ruling in Securities Suit, Remands for Further Review

WASHINGTON, D.C. — (Mealey’s) The U.S. Supreme Court today granted a petition for writ of certiorari in a securities class action lawsuit seeking determination of whether, pursuant to Section 11 of the Securities Act of 1933, a plaintiff must show not only that an opinion contained false...

Year-to-Date Securities Suit Filings Disproportionately Involve Non-U.S. Companies

Historically, non-U.S. companies listed on U.S. exchanges were sued in securities class action lawsuits less frequently than were listed U.S. companies. For several years now, according to NERA , non-U.S. firms have represented about 16% of all companies listed on the U.S. exchanges, but according to...

Another U.S. Securities Suit Arising From Overseas Corruption Investigation

In an earlier post , I noted that a significant factor driving securities litigation filings so far this year has been the rising number of U.S. securities lawsuits involving non-U.S. companies. A number of different factors are contributing to the filing of these suits, but among the factors is the...

Advisen Report: Declining Corporate and Securities Litigation Filings Continued in Second Quarter, But Most Recent Quarterly Trend May be Upward

The recent annual trend toward declining numbers of corporate and securities lawsuit filings continued in the first half and second quarter of 2015, although second quarter activity did increase slightly compared to the prior quarter, according to a report from the insurance industry information firm...

Securities Suit Against Company That Used Stock Promotion Firm Survives Dismissal Motion

As I have previously noted on this blog (most recently here ), one of the more distinctive litigation phenomena in recent years has been the rash of securities class action lawsuits involved allegations that the defendant firms’ use of stock promotion firms had resulted in misrepresentations to...

O.K., This Is a Big Deal: 7th Cir. Reinstates Neiman Marcus Consumer Data Breach Class Action

In a ruling that could provide an important boost future consumer data breach class action litigation, the Seventh Circuit has reinstated the Neiman Marcus data breach lawsuit, ruling that the district court erred in concluding that the plaintiffs’ fear of future harm from the breach was insufficient...