Oral argument in the Morrison v. National Australia Bank case, now before the U.S. Supreme Court on a petition for writ of certiorari, is scheduled to take place next week, on Monday March 29, 2010. The case presents questions about the extraterritorial application of the U.S. securities laws, questions of growing importance in light of
Cornerstone Releases Study of 2009 Securities Lawsuit Settlements
On March 24, 2010, Cornerstone Research released its annual study of securities class action lawsuit settlements. The most recent study, which is entitled "Securities Class Action Settlements: 2009 Review and Analysis" and is written by Ellen M. Ryan and Laura E. Simmons, can be found here. Cornerstone’s March 24, 2010 press release concerning the
Second Circuit Affirms Excess D&O Insurers’ Coverage Denial Based on Prior Knowledge Exclusion
In a March 23, 2010 Summary Order (here), the Second Circuit affirmed the March 2, 2009 ruling of Southern District of New York Judge Gerald Lynch, in which he held that the excess insurers’ prior knowledge exclusion precluded coverage under their policies for claims brought against former Refco directors and officers.
Bank Failure Cascade Continues
In the largest weekly collection of bank failure so far this year, the FDIC took control of seven banks this past Friday evening, bringing the 2010 year to date total of failed banks to 37. The YTD total already far exceeds the 2008 annual total of 25 failed banks and the pace of the
Courts Reject Hindsight Assessments, Dismiss Subprime Securities Suits
In recent decisions in separate subprime-related securities class action lawsuits reflecting a common unwillingness to engage in "backward looking assessments," two different Southern District of New York judges granted defendants’ motions to dismiss. In each of the cases, the judge’s recognition of the extent of the financial crisis played into their rulings, and in the
Two Appellate Courts Consider D&O Insurers’ Obligation to Advance Defense Expenses
Within the space of just a few days, two federal appellate courts – the Fifth and Sixth Circuits – issued separate opinions consider D&O insurers’ obligations to advance defense expenses. The Fifth Circuit entered its March 15, 2010 decision in the high-profile Stanford Financial insurance coverage dispute. The Sixth Circuit’s March 11, 2010 opinion was
Data Privacy and Security: The “Stealth Issue” of 2010?
Data security and privacy could be the "stealth issue of 2010," according to a recent report. Despite the intense focus on financial and related issues during the current economic crisis, a variety of legislative and regulatory initiatives suggest that data privacy and security issues necessarily will become a top corporate priority. These developments have important
Interview with the Authors of “Circle of Greed”
In their terrific new book "Circle of Greed: The Spectacular Rise and Fall of the Lawyer Who Brought Corporate America to Its Knees," Patrick Dillon and Carl M. Cannon detail the fascinating story of Bill Lerach, who rose to the pinnacle of his profession only to be brought down by criminal wrongdoing.
Madoff-Related Derivative Suit Survives Dismissal Motion in New York Court
In a March 12, 2010 order (here) in a Madoff-related derivative suit, the New York (Nassau County) Supreme Court, applying New York law, substantially denied defendants’ motion to dismiss, holding among other things that demand was excused. As far as I am aware, this is the first Madoff-related derivative suit to survive a
Lehman Bankruptcy Examiner Cites Company’s “Balance Sheet Manipulation”
According to the March 11, 2010 bankruptcy examiner’s report, the collapse of Lehman Brothers was a result of the deteriorating economic climate, exacerbated by Lehman’s executives, whose conduct ranged from "serious but non-culpable errors of business judgment to actionable balance sheet manipulation."
The Report was prepared pursuant to a January 2009 bankruptcy court order