Archives: Securities Litigation

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Seventh Circuit, Citing Delaware Precedent with Approval, Overturns Deal Lawsuit Disclosure-Only Settlement

Cornerstone Research’s recent report on merger objection lawsuit filings showed what many of us expected to see – that in the wake of Delaware Chancellor Andre Bouchard’s rejection of the disclosure only settlement in the litigation arising out of Zillow’s acquisition of Trulia, there would be a decline in the number of merger objection lawsuits … Continue Reading

Cornerstone Research: First Half Securities Suit Filings at Highest Level in Years

Securities class action lawsuit filings in the first half of 2016 leapt to their highest level in years, according to a recent report from Cornerstone Research. According to the report, which is entitled “Securities Class Action Filings: 2016 Midyear Assessment,” both the number of lawsuit filings and the rate of litigation were well above long-term … Continue Reading

Securities Class Action Lawsuit Filings Continue at Elevated Pace in the Year’s First Half

Continuing 2015’s elevated pace, the number of securities class action lawsuit filings during the first half of 2016 accrued in numbers well above both historical averages and recent levels. The first half 2016 levels puts the securities suit filing activity on pace for the most active year for securities class action lawsuit filings since 2004.… Continue Reading

Russian Trade Sanctions-Related Securities Lawsuit Dismissed

In a prior post, I noted that among the implications of the international trade sanctions is the possibility that companies affected by sanctions could face D&O claims. Among the risks the sanctions program presents is the possibility that a company dealing with sanctions-related issues could face a follow-on securities lawsuit, as investors seek to hold … Continue Reading

Guest Post: Deeper Trends in Securities Class Actions 2006-2015

There have been a number of important developments in class action securities litigation case filings in the recent years. In the following guest post, Michael Klausner, Professor of Law, Stanford Law School, and Jason Hegland, Executive Director, Stanford Securities Litigation Analytics, using the Stanford Securities Litigation Analytics database, identify and review several of these developments. As … Continue Reading

Securities Litigation and Life Sciences Companies: An Update

Life sciences companies are among the most frequent targets of securities class action litigation as I noted in a recent post. However, according to a recent law firm report, life sciences company defendants fared well in securities litigation in 2015. The recently released report, written by the Sidley Austin law firm and entitled “Securities Class … Continue Reading

Long-Running Household International Securities Suit Settles for $1.575 Billion

On June 16, 2016, HSBC, as successor in interest to Household Finance, announced that the parties to the long-running Household International securities class action litigation had agreed to settle the case for $1.575 billion. Subject to court approval, the settlement will bring to a close an epic case that has been pending for fourteen years. … Continue Reading

Onslaught of Securities Suits Against Brazilian Companies Continues

As a result of scandals, investigations, and even an environmental catastrophe, there has been a wave of securities lawsuit filings in the U.S. against Brazilian-domiciled companies whose securities are listed in the U.S. This filing trend began in late 2014 with the first lawsuit filing against Petrobras and certain of its directors and officers, which … Continue Reading

Guest Post: Second Circuit Strikes Down Imposition of $1.27 Billion FIRREA Penalty

On May 23, 2016, in an interesting development in one of the more high profile lawsuits to arise out of the financial crisis, the Second Circuit reversed the $1.27 billion civil penalty that Southern District of New York Judge Jed Rakoff  imposed on Countrywide and several related defendants in a case involving the company’s sale … Continue Reading

Guest Post: The State Court Section 11 Problem: Three Solutions

One of the more interesting current issues in the securities litigation arena is the question of whether or not the concurrent jurisdiction provisions in the ’33 Act continue to afford state court jurisdiction for Section 11 securities class action lawsuits, or whether the Securities Litigation Uniform Standards Act of 1998 (SLUSA) superseded these provisions. As … Continue Reading

Sixth Circuit, in Agreement with Second Circuit, Holds American Pipe Tolling Doesn’t Apply to Statutes of Repose

Among the important legal issues that arise in connection with securities class action litigation is the question of impact of the filing of a complaint on the running of the statutes of limitation and the statutes of repose. In analyzing statute of limitations issues, one of the tools that the courts have used is the … Continue Reading

U.S. Supreme Court Review of Concurrent State Court Jurisdiction for IPO-Related Securities Class Suits Sought

As a consequence of increased IPO activity during the period 2013-15, IPO-related securities class action litigation has picked up as well, as I noted in my year-end review of 2015 securities class action litigation. An interesting aspect of this IPO-related litigation has been that much of it has been filed in state court, particularly in … Continue Reading

Under Morrison, U.S. Securities Laws Don’t Apply to Toshiba’s Unsponsored ADRs Purchased OTC in the U.S.

It has been nearly six years since the U.S. Supreme Court’s landmark 2010 decision in Morrison v. National Australia Bank, in which the Court restricted the ability of shareholders of non-U.S. companies who purchased their shares outside the U.S. to file securities fraud lawsuit in U.S. courts under the U.S. securities laws. In the intervening … Continue Reading

Guest Post: Supreme Court Rejects Federal Jurisdiction over State Law Claims that Do Not Necessarily Raise Exchange Act Issues

Among the decisions that the Supreme Court issued this past Monday was its unanimous ruling in Merrill Lynch, Pierce, Fenner & Smith Inc. v. Manning (here), in which the Court held that the ’34 Act’s  exclusive federal jurisdiction provisions do not preclude a claimant from pursuing state law securities claims in state court.  In the … Continue Reading

Will Disclosure-Only Settlements in Merger Objection Suits Live On Outside Delaware?

When Delaware Chancellor Andre Bouchard rejected the proposed disclosure-only settlement in the litigation arising out of Zillow’s acquisition of Trulia, there was some belief that his decision represented the death knell for these kinds of settlements in merger objection lawsuits. There is indeed some evidence that the number of merger objection lawsuits filed has declined. … Continue Reading

Guest Post: IPO Companies, Section 11 Suits, and California State Court

One of the interesting (and challenging) quirks of the federal securities laws is that Section 22 of the ’33 Act provides concurrent state court jurisdiction for liability actions under the Act. Many courts have taken the view that legislation subsequent to the ’33 Act preempts state court jurisdiction under Section 22, as discussed here. While … Continue Reading

Cornerstone Research: Accounting-Related Securities Suit Filings and Settlements Increase

The number of securities class action lawsuit filings raising accounting-related allegations rose in 2015, as did the number and value of accounting-related securities suit settlements, according to a new report from Cornerstone Research. In addition to the increase in the number of accounted-related lawsuit filings, the market capitalization losses associated with those new filings increased … Continue Reading

Guest Post: Eight Circuit: Under Halliburton II, Defendants Successfully Rebut Fraud-on-the Market Presumption

In its June 2014 decision in Halliburton Co. v. Erica P. John Fund, Inc., the U.S. Supreme Court held, among other things, that in order to try to rebut the fraud-on-the-market presumption in order to defeat class certification, defendants can contend that the allegedly corrective disclosure did not impact the defendants company’s share price. In … Continue Reading

PwC Report: Surge of Suits Involving Smaller Companies Drove 2015 Securities Suit Filing Increase

Largely as a result of the number of suits filed against smaller companies, the number of securities class action lawsuits filed in 2015 increased for the third year in a row, to the highest level since 2008, according to a new report from PwC. The April 2016 report, entitled “Small Companies, Big Targets: 2015 Securities … Continue Reading

Cornerstone Research: Aggregate and Average Securities Suit Settlements Surged in 2015

Aggregate and average securities class action lawsuit settlements increased significantly in 2015 compared to the year before, according to the latest annual report from Cornerstone Research. Among reasons for the increase in aggregate settlement amounts is the increase in the absolute number of settlements during the year. The increase in the average settlement amount is … Continue Reading
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