SEATTLE - The lead plaintiff in a securities class action against a developmental stage biopharmaceutical company and certain of its executive officers has shown that the defendants misrepresented the success and prospects for the company's cancer treatment drug in violation of federal securities laws but has failed to show that the defendants acted with the requisite scienter, a federal judge in Washington ruled Oct. 18 in granting the defendants' motion to dismiss without prejudice (Samit Patel v. Seattle Genetics Inc., et al., No. 17-41, W.D. Wash., 2017 U.S. Dist. LEXIS 172588).
WASHINGTON, D.C. - The U.S. Supreme Court on Oct. 17 removed from the calendar oral arguments in an appeal of a securities class action ruling regarding Securities and Exchange Commission Regulation S-K Item 303's duty to disclose provision for federal securities law claims and stayed the action after the parties stated that they have reached a settlement (Leidos Inc., v. Indiana Public Retirement System, et al., No. 16-581, U.S. Sup.).
SAN FRANCISCO - A California federal judge on Oct. 16 granted preliminary approval of a $16 million settlement to be paid by ADT LLC to end several class action suits accusing the home security system company of failing to disclose that its wireless systems are unencrypted and vulnerable to attack (Michael Edenborough v. ADT, LLC, No. 16-2233, N.D. Calif., 2017 U.S. Dist. LEXIS 170896).
BALTIMORE - Bon Secours Health System Inc. (BSHSI) will contribute $14 million annually for the next seven years, for a total of $98 million, to seven defined-benefit plans operating as "church plans" to settle claims that it improperly operated the plans as exempt from the Employee Retirement Income Security Act and underfunded them, a class of participants claim in their motion for final approval of the settlement agreement and certification of settlement class filed Oct. 13 in the U.S. District Court for the District of Maryland (Arlene Hodges, et al. v. Bon Secours Health System, Inc., et al., No. 16-1079, D. Md.).
DENVER - The 10th Circuit U.S. Court of Appeals on Oct. 17 affirmed a lower federal court's entry of summary judgment in favor of an insurer, rejecting the insured's argument that an investigation by the U.S. Securities and Exchange Commission is a claim under its directors and officers liability policy that warrants coverage for all of its $3 million in legal fees (MusclePharm Corporation v. Liberty Insurance Underwriters, Inc., No. 16-1462, 10th Cir., 2017 U.S. App. LEXIS 20233).
CEDAR RAPIDS, Iowa - An Iowa federal judge on Oct. 13 found that a participant in an Employee Stock Ownership Plan (ESOP) had standing to assert claims against the plan's trustee for violation of the Employee Retirement Income Security Act, partially dismissing certain causes of action but allowing a claim that the trustee allegedly violated a fiduciary duty when it completed a transaction to proceed (Deborah Innis v. Bankers Trust Company of South Dakota, No. 4:16-cv-00650, S.D. Iowa).
BROOKLYN, N.Y. - Jurors in the criminal proceedings against alleged co-conspirator to convicted former pharmaceutical company CEO Martin Shkreli's massive securities fraud scheme Evan Greebel should not be made aware of Shkreli's acquittal on conspiracy to commit wire fraud charges, federal prosecutors argued Oct. 16 in an opposition to Greebel's request to disclose the information (United States of America v. Evan Greebel, No. 15-cr-0637, E.D. N.Y.).
WASHINGTON, D.C. - The U.S. Department of Labor's Employee Benefits Security Administration on Oct. 12 published in the Federal Register a proposal to delay the applicability of a final rule amending the claims procedure requirements that are applicable to employee disability benefit plans governed by the Employee Retirement Income Security Act.
MINNEAPOLIS - A pension fund failed to plead any actionable misstatements or omissions or scienter in arguing that off-road vehicle (ORV) manufacturer Polaris Industries Inc. and certain of its current and former executive officers concealed certain defects in its products that led to recalls of certain models of ORVs in violation of federal securities laws, a federal judge in Minnesota ruled Oct. 13 in granting the defendants' motion to dismiss (In re Polaris Industries Inc. Securities Litigation, No. 16-3108, D. Minn.).
WASHINGTON, D.C. - A California federal judge did not err in dismissing an infringement action because the patents in suit are directed to patent-ineligible subject matter under Section 101 of the Patent Act, 35 U.S.C. 101, the Federal Circuit U.S. Court of Appeals ruled Oct. 16 (Secured Mail Solutions LLC v. Universal Wilde Inc., No. 16-1728, Fed. Cir.).
PORTLAND, Ore. - A nonprofit trade association representing employers that sponsor benefit plans governed by the Employee Retirement Income Security Act filed suit in Oregon federal suit on Oct. 12 seeking a declaration that a reporting requirement included in Oregon's state-run retirement program is preempted by ERISA (The ERISA Industry Committee v. Tobias Read, No. 17-1605, D. Ore.).
ATLANTA - Although Section 1113(1) of the Employee Retirement Income Security Act is a statute of repose, as opposed to a statute of limitations, it is still subject to express waiver, the 11th Circuit U.S. Court of Appeals said Oct. 12 in answering a certified question from the Northern District of Georgia (Secretary, U.S. Department of Labor v. Robert N. Preston et al., No. 17-10833, 11th Cir., 2017 U.S. App. LEXIS 19926).
BOSTON - The First Circuit U.S. Court of Appeals denied a petition for rehearing and rehearing en banc in a securities class action filed by a pharmaceutical company's shareholders who alleged that the company and certain of its executive officers misrepresented the likelihood of U.S. Food and Drug Administration (FDA) approval for its Duchenne muscular dystrophy treatment drug in violation of federal securities law (Mark A. Corban v. Sarepta Therapeutics Inc., et al., No. 14-10201, D. Mass.).
HARTFORD, Conn. - Investors have properly pleaded each of their state and federal securities laws claims against the co-founder of a virtual currency mining company, a federal judge in Connecticut ruled Oct. 11 in denying the defendant's motion to dismiss all claims against him (Denis M. Audet, et al. v. Stuart A. Fraser, et al., No. 16-0940, D. Conn., 2017 U.S. Dist. LEXIS 167830).
NEW YORK - The Second Circuit U.S. Court of Appeals on Oct. 11 affirmed a Connecticut federal judge's dismissal of a retirement plan participant's suit alleging that the plan's service provider breached its fiduciary duties, determining that the plan participant failed to prove that a fee-sharing agreement between the service provider and the plan was a violation of the Employee Retirement Income Security Act (Richard A. Rosen v. Prudential Retirement Insurance and Annuity Co., No. 17-0239, 2nd Cir., 2017 U.S. App. LEXIS 19821).