LexisNexis® Legal Newsroom
Mealey's Securities/D&O Liability - Directors And Officers Say Judge Was Correct In Dismissing Shareholder Suit

NEW YORK - Certain of a company's current and former directors and officers told a federal court in New York on May 15 that the court did not overlook any facts that would have altered its finding that shareholders had failed to show 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.).

Mealey's Securities/D&O Liability - Shareholder Counters Directors', Officers' Claim Regarding Presuit Demand

WILMINGTON, Del. - A shareholder told a federal court in Delaware on May 16 that presuit demand upon a company's board of directors would have been futile (Joseph Quintal, Jr. v. Susan B. Bayh, et al., No. 14-cv-00311, D. Del.).

Mealey's Securities/D&O Liability - Shareholders Say Members Of Company's Board Face Liability For Their Actions

BOSTON - Two shareholders suing certain of a company's directors and officers for breach of fiduciary duty told a federal court in Massachusetts on May 14 that presuit demand upon the company's board would have been futile because a majority of the board members face a substantial likelihood of liability for their alleged wrongful actions (In re Ariad Pharmaceuticals Derivative Litigation, No. 13-cv-12816, D. Mass.).

Mealey's Securities/D&O Liability - Shareholder: Directors And Officers Participated In Wrongful Compensation Plan

LOS ANGELES - A company shareholder claims in a suit filed in federal court in California on May 15 that certain company directors and officers breached their fiduciary duties regarding a stock compensation plan when the company was losing large amounts of money (Steve Roof v. Sterling C. Scott, et al., No. 14-cv-03777, C.D. Calif.).

Mealey's Securities/D&O Liability - Expert's Event Study Unreliable; 1st Circuit OKs Securities Summary Judgment

BOSTON - A trial court did not err in excluding as unreliable expert testimony on loss causation on behalf of a class of plaintiff shareholders who allege that Credit Suisse Securities fraudulently withheld information from the market about the 2001 merger of America Online (AOL) and Time Warner, a First Circuit U.S. Court of Appeals panel held May 14 (Bricklayers and Trowel Trades International Pension Fund, et al. v. Credit Suisse Securities [USA] LLC, et al., No. 12-1750, 1st Cir.; 2014 U.S. App. LEXIS 8994).

Mealey's Securities/D&O Liability - Shareholder Accuses Directors And Officers Of Insider Trading

LOS ANGELES - A company shareholder told a federal court in California on May 7 that certain of the company's directors and officers caused more than $19 million in harm to the company due to alleged violations of insider trading laws (Colleen Witmer v. Victor Alston, et al., No. 14-cv-03505, C.D. Calif.).

Mealey's Securities/D&O Liability - SEC Issues Investor Alert Over Potential Bitcoin Investment Risk

WASHINGTON, D.C. - A certain level of risk is associated with investing in bitcoin and other forms of virtual currency of which investors must be aware, the Securities and Exchange Commission reported in an investor alert issued May 8.

Mealey's Securities/D&O Liability - Final Approval Of $2.5M Securities Class Action Settlement Granted

SANTA ANA, Calif. - A federal judge in California on May 6 granted final approval of a $2.5 million securities class action settlement, ruling that the settlement, as well as the lead plaintiffs' motion for attorneys' fees and costs were fair, adequate and reasonable (Vinh Nguyen v. Radient Pharmaceuticals Corp., et al., No. 11-0406, C.D. Calif.; 2014 U.S. Dist. LEXIS 63312).

Mealey's Securities/D&O Liability - High Court's Ruling In Morrison Precludes Investor Claims, Panel Rules

NEW YORK - A federal district court did not err in dismissing a federal securities class action lawsuit, a Second Circuit U.S. Court of Appeals panel ruled May 6, because, among other things, the shareholders' claims were precluded under the U.S. Supreme Court's ruling in Morrison v. National Australia Bank, Ltd. (City of Pontiac Policemen's and Firemen's Retirement System, et al. v. UBS AG, et al., No. 12-4355, 2nd Cir.; 2014 U.S. App. LEXIS 8533).

Mealey's Securities/D&O Liability - Judge Grants Preliminary Approval Of $280M Securities Class Action Settlement

CENTRAL ISLIP, N.Y. - A federal judge in New York on May 2 granted preliminary approval of a $280 million securities class action settlement between investors and J.P. Morgan Corp. affiliates and certain of their officers and directors for misrepresenting the investment quality of certain residential mortgage-backed securities the defendants sold in violation of federal securities laws (Plumbers' and Pipefitters' Local #562 Supplemental Plan and Trust, et al. v. J.P. Morgan Corp. I, et al., No. 08-1713, E.D. N.Y.).

Mealey's Securities/D&O Liability - Judge: Best Buy Officer Not A Primary Violator In Securities Fraud Suit

MINNEAPOLIS - A federal judge in Minnesota on April 30 granted in part and denied in part a motion for judgment on the pleadings in a securities class action, ruling that shareholders have failed to show that an officer of Best Buy Co. Inc. acted as a primary violator in a securities fraud scheme (IBEW Local 98 Pension Fund, et al. v. Best Buy Co., Inc., et al., No. 11-429, D. Minn.; 2014 U.S. Dist. LEXIS 59951).

Mealey's Securities/D&O Liability - Kosmos Energy, Others To Pay $10.2M To Settle Securities Class Action Suit

DALLAS - Defendants in a securities class action lawsuit will pay $10.2 million to settle claims that they misrepresented the performance levels at an oil field, as well as its future expected performance, in violation of federal securities laws, according to court documents filed April 28 in Texas federal court (In re Kosmos Energy Ltd. Securities Litigation, No. 12-373, N.D. Texas).

Mealey's Securities/D&O Liability - First Horizon To Pay $110M To Settle Securities Lawsuit With FHFA

NEW YORK - First Horizon National Corp., certain of its subsidiaries and others will pay $110 million to settle claims that they violated state and federal securities laws in misrepresenting the investment quality of nearly $883 million in residential mortgage-backed securities that were sold to Fannie Mae and Freddie Mac (collectively, government-sponsored agencies or GSEs), the Federal Housing Finance Agency (FHFA) announced April 29 (Federal Housing Finance Agency v. First Horizon National Corp., No. 11-6193, S.D. N.Y.).

Mealey's Securities/D&O Liability - District Court Improperly Applied Inquiry Notice Standard, 11th Circuit Rules

ATLANTA - A federal district court erred in dismissing an investor lawsuit against their investment advisers for negligently investing in a feeder fund for Bernard L. Madoff's massive Ponzi scheme because the district court erred in applying the inquiry notice standard in its dismissal, an 11th Circuit U.S. Court of Appeals panel ruled April 28 (Quentin Walter, et al. v. Frank J. Avellino, et al., No. 13-13081, 11th Cir.; 2014 U.S. App. LEXIS 7901).

Mealey's Securities/D&O Liability - Cornerstone Releases Accounting Class Action Filings, Settlements Report

LOS ANGELES - Even though the number of accounting class action filings remained "relatively consistent" at 47 filings in 2013, market capitalization losses associated with such cases saw a rise over 2012, according to a report issued April 29 by economic and financial consulting firm Cornerstone Research.

Mealey's Securities/D&O Liability - 2nd Circuit Revives Libor Claims Against Barclays

NEW YORK - The Second Circuit U.S. Court of Appeals on April 25 affirmed in part and vacated in part a federal court's dismissal of a putative securities fraud class action alleging that Barclays Bank PLC and its affiliates (collectively, Barclays) and former officers willfully misrepresented the bank's borrowing costs and knowingly submitted false London Interbank Offered Rate (Libor) information (Carpenters Pension Trust Fund, et al. v. Barclays PLC, et al., No. 13-2678, 2nd Cir.).

Mealey's Securities/D&O Liability - Judge: State Law Claims Against UBS Not Entitled To Equitable Tolling

KANSAS CITY, Kan. - A federal judge in Kansas on April 21 dismissed the National Credit Union Administration Board's remaining claims in a federal securities lawsuit, ruling that those claims are time-barred and not entitled to equitable tolling (National Credit Union Administration Board v. UBS Securities LLC, No. 12-2591, D. Kan.).

Mealey's Securities/D&O Liability - Barclays Bank Reaches $280M Settlement In Fannie, Freddie Lawsuits

NEW YORK - Barclays Bank PLC and certain of its affiliates will pay $280 million to settle claims with the Federal Housing Finance Agency (FHFA) in two related lawsuits alleging that Barclays and its affiliates misrepresented the investment quality of certain residential mortgage-backed securities they sold to Fannie Mae and Freddie Mac in violation of state and federal securities laws, according to court documents released on April 24 (Federal Housing Finance Agency v. Barclays Bank PLC, et al., No. 11-6190, S.D. N.Y.; and Federal Housing Finance Agency v. Ally Financial Inc., No. 11-7010, S.D. N.Y.).

Mealey's Securities/D&O Liability - Shareholder: Presuit Demand Upon Company's Board Would Have Been Futile

DENVER - A shareholder told a federal court in Colorado on April 22 that his second amended complaint against certain of a company's directors and officers contains particularized facts showing that false or misleading statements were made and that presuit demand upon the company's board would have been futile (John Seni, Derivatively on Behalf of CIBER, Inc. v. David C. Peterschmidt, et al., No. 12-cv-00320, D. Colo.).

Mealey's Securities/D&O Liability - Shareholder Claims He Has Shown That Presuit Demand Would Have Been Futile

LAS VEGAS - A company shareholder argued in a federal court in Nevada on April 17 that he has adequately shown that a majority of the company's directors are not disinterested and that, therefore, presuit demand upon the company's board would have been futile (In re MGM Mirage Shareholder Derivative Litigation, No. 09-cv-01815, D. Nev.).

Mealey's Securities/D&O Liability - Shareholder: Directors And Officers Gave False Facts About Aborted Merger

WILMINGTON, Del. - A shareholder claimed in a federal court in Delaware on April 17 that certain of a company's directors and officers breached their fiduciary duties by disseminating false and misleading information regarding a proposed merger that failed to come to fruition (Jim Fitzgerald v. Roy Armes, et al., No. 14-cv-00479, D. Del.).

Mealey's Securities/D&O Liability - Shareholder: Directors And Officers Sold Stock Before Making Bad News Public

LOS ANGELES - A company shareholder said in a federal court in California on April 15 that certain of the company's directors and officers breached their fiduciary duty by causing the company to make false and misleading statements and that a number of the directors and officers sold stock before the news that the statements were false broke (Marc Hagan v. Deepak Chopra, et al., No. 14-cv-02910, C.D. Calif.).

Mealey's Securities/D&O Liability - Herbalife Faces Securities Class Suit Following Criminal Probe

LOS ANGELES - A purchaser of Herbalife Ltd. stock filed a class complaint in California federal court on April 14 accusing the company and its executives of hiding the fact that the company's operations were based on a pyramid scheme, resulting in artificially inflated stock prices before the disclosure (Abdul Awad, et al. v. Herbalife Ltd., et al., No. 14-2850, C.D. Calif.).

Mealey's Securities/D&O Liability - Panel Affirms Dismissal In Stanford Ponzi Scheme Investor Suit Against SEC

NEW ORLEANS - Dismissal of an investor lawsuit against the Securities and Exchange Commission was proper, a Fifth Circuit U.S. Court of Appeals panel ruled April 14, because the investors' claims fall under the discretionary function exception of the Federal Tort Claims Act (FTCA) (Reuel Anderson, et al. v. United States of America, No. 13-30897, 5th Cir.).

Mealey's Securities/D&O Liability - Vice Chancellor Says Trial Is Appropriate In Suit Against Directors And Officers

WILMINGTON, Del. - A Delaware vice chancellor on April 8 denied a motion for summary judgment and said evidence regarding accusations brought by shareholders against certain of a company's directors and officers should be developed at trial (Herbert Chen, et al. v. Robert Howard-Anderson, et al., No. 5878-VCL, Del. Chanc.; 2014 Del. Ch. LEXIS 50).