So the U.S. Supreme Court held in Morrison that the investors who purchased their shares of a non-U.S. company on a foreign exchange cannot pursue claims under the Exchange Act, but securityholders who purchased American Depositary Receipts (ADRs) in the U.S. can still seek damages under the Exchange Act, right? Not according to a September
AIG’s Subprime Securities Suit Survives Dismissal Motion
In a September 27, 2010 order (here), Judge Laura Taylor Swain denied the dismissal motions in the subprime-related securities class action lawsuit pending against AIG, certain of its former directors and officers, its accountant and its offering underwriters. Andrew Longstreth’s September 27 Am Law Litigation Daily article about the decision can be found
Web Notes and Updates
NYSE Commission on Corporate Governance: On September 23, 2010, the NYSE Commission on Corporate Governance issued a report (here) following a two year review of governance issues and considerations. The Commission, chaired by Larry Sonsini of the Wilson Sonsini law firm, included more than two dozen members representing a broad range of constituencies
Sallie Mae Securities Suit Survives Dismissal Motion
In a September 24, 2010 order (here), Southern District of New York William Pauley denied the dismissal motions of Sallie Mae and its former CEO, Albert Lord, but granted the dismissal motion of CFO (and later CEO), Charles Andrews, in the credit crisis-related securities suit against Sallie Mae first filed in 2008.
Pressure for Action Against Corporate Officials
News reports about the September 22, 2010 Senate Banking Committee hearing regarding the SEC have focused on the provocative statements by SEC Inspector General H. David Katz. Among other things, Katz suggested that a Texas-based SEC official quashed the investigation of allegations regarding Stanford Financial Group, allowing the Stanford-related Ponzi scheme to continue. Katz also
Executive Protection: Private Company D&O Insurance
In a series of posts, I have been exploring the "nuts and bolts" of D&O insurance. In this post, the fifth in the series, I examine D&O insurance issues of particular concern to private companies. Both the potential liability exposures and the available insurance solutions for private companies and their directors and officers are quite
When is a Securities Suit Stale?
When the U.S. Supreme Court issued its ruling earlier this year in the Merck case pertaining to the question of what triggers the running of the statute of limitations in securities cases, there was some speculation that the decision might encourage an influx of cases involving events from the distant past. There really have not
Morrison Precludes Claims Based on Non-U.S. Purchased Shares, Even if Company Shares “Listed” in U.S.
On September 14, 2010, in another ruling that the U.S. Supreme Court’s decision in Morrison v. National Australia Bank precludes claim by "f-squared" claimants – that is, U.S. residents who purchased shares of a Non-U.S. company on a foreign exchange – Southern District of New York Judge Victor Marrero dismissed the claims of investors who
Dismissal Motion in ING Bondholders Subprime Suit Granted – Except for One Part
A lawsuit brought by investors who had purchased securities in three ING Group bond offerings in 2007 and 2008 was largely dismissed in a ruling issued Tuesday, although some allegations regarding the company’s June 2008 offering disclosures did survive.These rulings appeared in a September 14, 2010 order written by Southern District of New York Judge
Another Loan Loss Reserve Disclosure Case Dismissal
In the latest ruling to address the pleading adequacy of a securities suit based on a financial institution’s loan loss reserve disclosures, a federal judge has found that the plaintiffs’ allegations in the SunTrust Trust Preferred Securities lawsuit were not sufficient to state a claim under the securities laws. Northern District of Georgia Judge William