NERA: Canadian Securities Class Action Filings in 2015 at Lowest Level in Years

can flag 2In the United States, securities class action lawsuit filings were at their highest level in years in 2015. The situation in Canada during 2015 was completely the opposite. According to a February 11, 2016 report from NERA Economic Consulting, securities class action lawsuit filings in Canada during 2015 were at their lowest levels since 2003. According to the report, which is entitled “Trends in Canadian Securities Class Actions: 2015,” and subtitled “Are We in Bear Territory?” (here), there were only four securities class action lawsuits filed in Canada in 2015, well below the levels seen in recent years and well below historical averages. Indeed, according to the report, case resolutions far outpaced new filings in 2015. NERA’s February 11, 2016 press release about the report can be found here. Continue Reading

Can Workforce Changes Made in Response to Obamacare Mandates Lead to Employer Liability Claims? Yes, They Can

daveandbustersThe Affordable Care Act – better known as Obamacare – contains numerous provisions that define the relationships between employers and their employees with respect to health care benefits. Among the most critical are the statute’s employer mandates requiring employers with more than 50 employees to offer health insurance coverage to its employees who work 30 hours or more a week or face statutory penalties. As I have previously noted in discussing possible Obamacare-related employer liability issues, the ACA’s mandate creates incentives for employers to try to restructure their workforce to avoid the statute’s requirements. However, as I have also noted, employer actions to restructure their workforces to avoid providing health plan benefits could lead to liability claims under ERISA.


A recent decision from the Southern District of New York shows how an employer’s actions to reduce full-time staff to part-time status — allegedly undertaken in an effort to avoid the health care law’s impact — can lead to ERISA class action claims. The decision also underscores how the affected employees may be able to assert viable ERISA claims. Continue Reading

D&O Insurance: Whose “Securities” Must a Claim Involve to Trigger Securities Claim Coverage?

Ninth Circuit bitmapPublic company D&O insurance provides coverage for “Securities Claims.” But whose securities must be involved in a claim in order for coverage to be triggered? Must the claim involve the securities of the corporate policyholder itself? Or can coverage be triggered by a claim involving mortgage-backed securities the corporate policyholder issued as part of its financial operations? Continue Reading

Does the FDIC Target Only Failed Bank Directors and Officers That Have D&O Insurance?

federal depositFollowing the recent bank failure wave, the FDIC filed liability actions against the former directors and offices of many of the failed banks, as detailed here. But the FDIC did not sue the former executives of every failed bank. Why did the FDIC sue the executives of some failed banks but not others? Was it because the failed banks the agency targeted had engaged in qualitatively different conduct? Or was it merely because the ones the FDIC sued had D&O insurance in force from which the agency could extract a monetary recovery? Continue Reading

There’s a Reason You Are Suddenly Hearing About the TCPA Everywhere You Go

increasingOn the panel in which I participated during last week’s PLUS D&O Symposium, one of the important topics we discussed was the question of coverage under a D&O insurance policy for claims under the Telephone Consumer Protection Act, a topic about which I have previously written on this blog. That a once-obscure statute like the TCPA has become an important topic of conversation is no accident. The fact is that the number of TCPA actions filed has absolutely exploded, as detailed in a recent study published by the Institute for Legal Reform, an affiliate of the U.S. Chamber of Commerce. Continue Reading

Spanish Class Action is the Latest Collective Investor Action Filed Outside U.S.

spain1The filing of securities class action lawsuits is, of course, well-established in the United States, and in recent years has become a regular phenomenon in Australia and Canada as well. In the wake of various recent scandals, numerous group or mass investor actions, if not full-blown class actions, have been filed or will be filed in a number of other countries, including the U.K. (for example, in connection with the Tesco accounting scandal), Germany (in connection with the VW emissions scandal), Japan (in connection with the Toshiba scandal), Italy (in connection with the Saipem scandal), and possibly Brazil (in connection with various companies’ involvement in the Petrobras scandal).


Now it appears that investors in the troubled Spanish banking company Bankia have initiated a class action lawsuit against the company. According to news reports (here), counsel for 660 individual investors has filed an action in a Madrid court seeking to have the individuals compensated for their investment losses in connection with the company’s 2011 stock flotation. The investors collectively seek recovery of 6.3 million euros (about $7 million). Continue Reading

Two German Cities in Winter

2016-01-28 03.43.42aThe D&O Diary is on assignment in Germany this week, with the first stop for a meeting and a short visit in the Free and Hanseatic City of Hamburg – “Free,” as a free Imperial city under the Holy Roman Empire, and “Hanseatic” for the Hanseatic League, the Northern European trading confederation in the late Middle Ages. Though Hamburg is 60 miles inland from the North Sea on the Elbe River, it is a seaport – the second largest in Europe, in fact. It remains a separate city-state within the present German federation. At 1.7 million people, it is also the second-largest city in Germany. Continue Reading

Delaware Chancellor Rejects Disclosure-Only Settlement, Signals What’s Next for Merger Objection Suits

del1In a January 22, 2016 Delaware Court of Chancery decision that likely will prove to be significant because of the light it sheds on the future of disclosure-only settlements in merger objection lawsuits in Delaware, Chancellor Andre Bouchard rejected the proposed settlement in the litigation arising out of Zillow’s acquisition of Trulia, saying that because the “none of the supplemental disclosures were material or even helpful to Trulia’s stockholder,” the proposed settlement “does not afford them meaningful consideration to warrant providing a claim release.”


In reaching these conclusions, Bouchard reviewed the dynamics that have led to the “proliferation of disclosure settlements” and the problems these kinds of settlements present. Bouchard also offered his perspective on the ways that remedial disclosure assertions in deal litigation could optimally be litigated. At a minimum, Bouchard’s opinion represents a warning to the plaintiffs’ bar that to the extent they continue to pursue disclosure settlements, they can “expect that the Court will be increasingly vigilant in scrutinizing the ‘give’ and the ‘get’ of such settlements to ensure that they are genuinely fair and reasonable to the absent class members.” Chancellor Bouchard’s January 22, 2016 opinion in the Trulia case can be found here. Continue Reading

The Game of Names

soccerLong-time readers know that I am a huge fan of European soccer. When I have the time, there is just about nothing else that I would rather do than watch a match in one of the top leagues. Part of the reason I enjoy it so much is that the games just flow. The clock starts and play continues, without timeouts or interruptions. Quite a contrast to American football, in which eleven minutes of action are crammed into three hours of watch time. I also like the European clubs’ rivalries, their fans’ enthusiasm, and the sudden bursts of sheer athletic brilliance that frequently result in goals.


And I also like the players’ names. I know that the players are not chosen for their names, but for some reason the game attracts so many players with names that are distinctive, musical, or audacious. It starts with players like Robert Snodgrass, the Scot who now plays for Hull City in the English Championship League, and Lee Cattermole, who plays for Sunderland in the Premier League. These players’ are among those whose names I find that I can’t hear without involuntarily repeating them. Here’s what I sound like watching either of these player’s teams play: “Snodgrass!” “Cattermole!” Continue Reading

Why the Supreme Court’s Recent Class Action Decision is Important and What May Be Coming Next

supremesAfter the Supreme Court issued its decision last week in Campbell-Ewald Co. v. Gomez (here), in at least some quarters the story about the decision spread under the heading that the Court had issued an important Telephone Consumer Protection Act ruling. The case in which the Court issued its decision does indeed involve a TCPA damages claim. However, the Court’s analysis did not address the plaintiff’s TCPA claim as such. The Court’s ruling – which addressed the issue of whether or not an unaccepted offer of judgment moots a class action plaintiff’s claim – is nevertheless important.


As discussed below, the Court’s ruling in the Campbell-Ewald case sets the stage for further litigation on the question of whether, by taking a different approach than the defendant did here, class action defendants might yet be able to moot a class action suit by “picking off” the named plaintiff’s claim. The Court’s decision in the Campbell-Ewald case may also prefigure the Court’s consideration of standing issues in the Spokeo case, another case that raises basic justiciability issues and that remains pending on the Court’s docket for this term.   Continue Reading