LexisNexis® Legal Newsroom
Mealey's Securities/D&O Liability - Supreme Court Declines Review Of American Pipe Tolling Clarification Suit

WASHINGTON, D.C. - The U.S. Supreme Court on June 27 decided not to grant review of a New York federal court's dismissal of a securities class action lawsuit to determine whether the district court erred in ruling that investors' claims were not timely in contradiction of the high court's ruling in American Pipe & Construction Co. v. Utah (Russell Dusek, et al. v. JPMorgan Chase & Co., et al., No. 16-389, U.S. Sup.; 2016 U.S. S. Ct. Briefs LEXIS 3491).

Mealey's Securities/D&O Liability - High Court Won't Hear Appeal In Deepwater Horizon Securities Suit

WASHINGTON, D.C. - The U.S. Supreme Court on June 27 denied an investor's petition for writ of certiorari that sought to overturn a federal district court's dismissal of a securities class action lawsuit as time-barred against Transocean Ltd. and certain of its former executive officers stemming from the Deepwater Horizon explosion and oil spill (DeKalb County Pension Fund v. Transocean Ltd., et al., No. 16-206, U.S. Sup.).

Mealey's Securities/D&O Liability - Split D.C. Circuit Panel Rejects Claims In SEC Appointments Clause Appeal

WASHINGTON, D.C. - Without providing further detail, an equally divided 10-judge panel of the District of Columbia Circuit U.S. Court of Appeals on June 26 denied on rehearing en banc an investment adviser and his company's argument that a lower court erred in determining that the Securities and Exchange Commission has appointed its administrative law judges in violation of the appointments clause of the U.S. Constitution (Raymond J. Lucia Companies Inc., et al. v. Securities and Exchange Commission, No. 15-1345, D.C. Cir.).

Mealey's Securities/D&O Liability - U.S. Supreme Court To Hear SLUSA Jurisdictional Provisions Appeal

WASHINGTON, D.C. - The U.S. Supreme Court on June 27 agreed to hear an appeal of a California Superior Court ruling that shareholders in a securities class action are not preempted from bringing their claims under the Securities Act of 1933 by the Securities Litigation Uniform Standards Act (SLUSA) (Cyan Inc. v. Beaver County Employees Retirement Fund, et al., No. 15-1439, U.S. Sup.).

Mealey's Securities/D&O Liability - Shareholders Pleaded Scienter In Securities Suit Against Drug Maker, Judge Rules

SEATTLE - Shareholders in a securities class action lawsuit against a developmental pharmaceutical company and certain of its executive offices have properly pleaded a material misrepresentation at this point in the litigation and scienter in alleging that the defendants misrepresented the clinical trial results for the company's new cancer treatment drug in violation of federal securities laws, a federal judge in Washington ruled June 14 (In re Juno Therapeutics Inc., No. 16-1069, W.D. Wash., 2017 U.S. Dist. LEXIS 91608).

Mealey's Securities/D&O Liability - Report: 2016 Securities Class Action Settlements Among Top 100 All-Time

NEW YORK - A total of 13 settlements in 2016 were large enough to be added to the top 100 list of securities class action settlements, including one to the top 10 all-time, in terms of total settlement amount, according to a report issued by corporate governance solutions provider Institutional Shareholder Services Inc. (ISS) Securities Class Action Services Inc. on June 13.

Mealey's Securities/D&O Liability - Panera Bread Investor Sues Company, Board Over Proposed Merger Deal

WILMINGTON, Del. - A shareholder sued restaurant chain Panera Bread Co. and its board of directors in Delaware federal court on June 7, alleging that the defendants issued a proxy statement in connection with a proposed merger deal that contains information insufficient for shareholders to properly consider the proposed deal in violation of federal securities laws (Lawrence Phillips v. Panera Bread Co., et al., No. 17-0697, D. Del.).

Mealey's Securities/D&O Liability - Investor Group Named Lead Plaintiff In Federal Securities Class Action

NEW YORK - An investor group was appointed as lead plaintiff in a securities class action lawsuit against a pet therapeutics company and certain of its executive officers on June 6 after a federal judge in New York ruled that the group met all statutory requirements to serve in the position (In re Aratana Therapeutics Inc. Securities Litigation, No 17-0880, S.D. N.Y., 2017 U.S. Dist. LEXIS 87351).

Mealey's Securities/D&O Liability - Judge: Investor Failed To Plead Demand Futility In Shareholder Derivative Suit

DENVER - An investor has failed to plead demand futility in arguing that the board of directors for a Mexican food restaurant chain breached their fiduciary duty in failing to provide the necessary oversight of the company, leading to a massive foodborne illness outbreak, a federal judge in Colorado ruled June 7 in granting the defendants' motion to dismiss (Sean Gubricky v. Steve Ells, et al., No. 16-2011, D. Colo.).

Mealey's Securities/D&O Liability - Investor Named Lead Plaintiff In Securities Suit Over Public Offering Misstatements

BROOKLYN, N.Y. - A federal judge in New York on June 6 appointed a shareholder as lead plaintiff in a securities class action lawsuit against an industrial biotechnology company and certain of its current and former executive officers, ruling that the shareholder met all statutory requirements to serve in the position (Donald Chu v. BioAmber Inc., et al., No. 17-1531, E.D. N.Y.).

Mealey's Securities/D&O Liability - High Court Finds That SEC Disgorgement Claims Must Be Brought Within 5 Years

WASHINGTON, D.C. - Because they operate as penalties under federal law, disgorgement claims in Securities and Exchange Commission enforcement actions must be brought within five years of the date in which the claim accrued, the U.S. Supreme Court ruled June 5 in a unanimous opinion (Charles R. Kokesh v. Securities and Exchange Commission, No. 16-529, U.S. Sup.).

Mealey's Securities/D&O Liability - Investors Failed To Plead Elements Of Securities Law Claims, Defendants Say

NEW YORK - Lead plaintiffs in a securities class action lawsuit against a drug maker and certain of its current and former executive officers have failed to plead their federal securities law claims against the defendants because they have failed to plead any material misrepresentation, scienter or loss causation, the defendants argue in a May 30 motion to dismiss filed in New York federal court (In re Mylan N.V. Securities Litigation, No. 16-7926, S.D. N.Y.).

Mealey's Securities/D&O Liability - For-Profit College To Pay $2.25M To Settle Securities Fraud Claims

LOS ANGELES - A for-profit secondary education company and certain of its current and former executive officers have agreed to pay $2.25 million to settle claims that the company concealed its failure to comply with federal student loan funds usage requirements in violation of federal securities laws, according to documents filed in California federal court on May 26 (Jimmy Elias Karam v. Corinthian Colleges Inc., et al., No. 10-6523, C.D. Calif.).

Mealey's Securities/D&O Liability - 9th Circuit: Claims Subject To American Pipe Tolling In Securities Class Action

LOS ANGELES - A federal district court erred in holding that claims in a securities class action lawsuit against a Chinese agricultural products manufacturer and certain of its officers and directors were time-barred because the statute of limitations was tolled pursuant to Supreme Court precedent in American Pipe & Construction Co. v. Utah and Crown, Cork & Seal Co. v. Parker, a Ninth Circuit U.S. Court of Appeals panel ruled May 24 in reversing and remanding (Michael H. Resh, et al. v. China Agritech Inc., et al., No. 15-55432, 9th Cir., 2017 U.S. App. LEXIS 9029).

Mealey's Securities/D&O Liability - Judge Dismisses Securities Claims Related To Allegedly Fraudulent Club Investment

SAN DIEGO - A California federal judge on May 22 dismissed an investor's claims for violation of California's unfair competition law (UCL) and securities laws, finding that he failed to show that he was fraudulently induced into investing in the development of a nightclub (Matthias Mueller v. San Diego Entertainment Partners LLC, et al., No. 16cv2997, S.D. Calif., 2017 U.S. Dist. LEXIS 77643).

Mealey's Securities/D&O Liability - Judge Substantially Denies Motion To Dismiss In IPO Stock Drop Suit

NEW YORK - A pension fund has properly pleaded a majority of its federal securities law claims alleging that a company, certain of its officers and directors and the underwriters of its initial public offering (IPO) concealed from investors that the company was expected to see a tax increase that would substantially affect revenue, a federal judge in New York ruled May 23 in granting in part and denying in part the defendants' motion to dismiss (Yi Xiang, et al. v. Inovalon Holdings Inc., et al., No. 16-4923, S.D. N.Y., 2017 U.S. Dist. LEXIS 78207).

Mealey's Securities/D&O Liability - Judge: Defendants' Alleged Misrepresentations Not Actionable In Securities Suit

NEWARK, N.J. - Lead plaintiffs in a securities class action lawsuit against a pharmaceutical company and its CEO have failed to plead any material misstatements or omissions in arguing that the defendants misrepresented that the company's new drug was expected to gain U.S. Food and Drug Administration approval in violation of federal securities laws, a federal judge in New Jersey ruled May 19 in granting the defendants' motion to dismiss (Blake Bauer v. Eagle Pharmaceuticals Inc., et al., No. 16-3091, D. N.J., 2017 U.S. Dist. LEXIS 76247).

Mealey's Securities/D&O Liability - Judge: Pension Fund Cured Scienter Pleading Deficiency Against Company, CEO

SAN FRANCISCO - In granting in part and denying in part a motion to dismiss, a federal judge in California on May 17 held that a pension fund has cured its pleading deficiencies and properly shown that a semiconductor producer and its CEO acted with the requisite scienter in misrepresenting the company's key business metrics as required under federal securities laws (Daniel Luna v. Marvell Technology Group Ltd., et al., No. 15-5447, N.D. Calif., 2017 U.S. Dist. LEXIS 75262).

Mealey's Securities/D&O Liability - Elements Of Securities Law Claim Properly Pleaded, GoPro Investor Says

OAKLAND, Calif. - Dismissal of an amended securities class action complaint is not proper because the lead plaintiff in the action has properly pleaded an actionable misrepresentation or omission, scienter and loss causation, the lead plaintiff argues in a May 15 opposition brief (Anton Bielousov v. GoPro Inc., et al., No. 16-6654, N.D. Calif.).

Mealey's Securities/D&O Liability - Panel Affirms Dismissal Of Securities Class Action For Failure To Plead Scienter

BOSTON - A federal district court judge did not err in dismissing a shareholder class action lawsuit because the lead plaintiff failed to plead scienter in making its federal securities law claims against a drug maker and certain of its executive officers, a First Circuit U.S. Court of Appeals panel ruled May 12 in affirming the lower court's decision (In re Biogen Inc. Securities Litigation, No. 16-1976, 1st Cir., 2017 U.S. App. LEXIS 8475).

Mealey's Securities/D&O Liability - Panel: Judge Did Not Engage In Prohibited Fact Finding In Securities Suit

SAN FRANCISCO - A federal judge did not err in dismissing a lead plaintiff's second amended complaint in a securities class action lawsuit against LifeLock Inc. and certain of its executive officers because the lead plaintiff failed to plead any material misrepresentations or omissions in pleading their federal securities law claims, a Ninth Circuit U.S. Court of Appeals panel ruled May 11 in affirming (In re LifeLock Inc. Securities Litigation, No. 15-16885, 9th Cir., 2017 U.S. Dist. LEXIS 8386).

Mealey's Securities/D&O Liability - Investor Failed To Cure Pleading Issues In LeapFrog Securities Suit, Judge Rules

SAN FRANCISCO - An investor failed to plead falsity or scienter in alleging that LeapFrog Enterprises Inc. and members of its board of directors misrepresented the company's business and financial condition in documents released as part of a proposed merger deal, a federal judge in California ruled May 9 in granting the defendants' motion to dismiss a second amended complaint without leave to amend (Pete J. Manger v. LeapFrog Enterprises Inc., et al., No. 16-1161, N.D. Calif.; 2017 U.S. Dist. LEXIS 70893).

Mealey's Securities/D&O Liability - Barclays Agrees To Pay More Than $97M To Settle SEC Enforcement Action

WASHINGTON, D.C. - Barclays Capital Inc. will pay more than $97 million to settle claims filed by the Securities and Exchange Commission alleging that the broker-dealer overcharged investors from September 2010 to March 2015 for services not provided, according to an order instituting cease-and-desist proceedings filed May 10 by the SEC (In the Matter of Barclays Capital Inc., No 3-17978, SEC).

Mealey's Securities/D&O Liability - Judge Grants Preliminary Approval Of $165M Settlement In MBS Suit

NEW YORK - A federal judge in New York on May 9 granted preliminary approval of a $165 million securities class action settlement between shareholders and certain underwriters of mortgage-backed securities (MBS) alleged to have taken part in a fraudulent scheme to misrepresent the underwriting standards they used in the offering documents for a series of MBS (New Jersey Health Fund v. Royal Bank of Scotland Group PLC, et al., No. 08-5310, S.D. N.Y.).

Mealey's Securities/D&O Liability - Panel Affirms Court's Dismissal Of Securities Suit For Failure To Plead Falsity

SAN FRANCISCO - The lead plaintiff in a securities class action lawsuit against a tech company and certain of its current and former executive officers failed to plead any of the required elements of falsity as required pursuant to the U.S. Supreme Court's ruling in Omnicare Inc., et al. v. The Laborers District Council Construction Industry Pension Fund and The Cement Masons Local 526 Combined Funds, a Ninth Circuit U.S. Court of Appeals panel ruled May 5 in affirming a lower court's dismissal ruling (City of Dearborn Heights Act 345 Police & Fire Retirement System v. Align Technology Inc., et al., No. 14-16814, 9th Cir., 2017 U.S. App. LEXIS 8005).