The D&O Diary

The D&O Diary

A PERIODIC JOURNAL CONTAINING ITEMS OF INTEREST FROM THE WORLD OF DIRECTORS & OFFICERS LIABILITY, WITH OCCASIONAL COMMENTARY

Tag Archives: Securities Litigation

Cornerstone Research Releases 2013 Securities Class Action Settlements Analysis

Posted in Securities Litigation
Owing to a number of larger settlements, the average securities class action settlement amount in 2013 rose, while at the same time the media settlement amount declined, according to a study of the securities suit settlements from Cornerstone Research. The study also reports that the number of settlements and the aggregate dollar value of all … Continue Reading

Securities Suit Filing Trends: More About IPOs and Investigative Follow-On Actions

Posted in Securities Litigation
Two securities suit filing trends that emerged during 2013 were the filing of securities class action lawsuits against companies that had recently completed IPOs (about which refer here) and the filing of securities suits  in the wake of investigative or regulatory actions (as discussed here). Based on the recent filings, it appears that these trends … Continue Reading

U.S. Supreme Court Takes Up Yet Another Securities Case: To Support a Section 11 Claim, Must an Opinion Be Subjectively False?

Posted in Securities Litigation
As if it were not enough that the Court is already considering a case that could change the face of securities class actions (that is, the Halliburton case, which will be argued this week), the U.S. Supreme Court has now agreed to take up yet another securities case.   In a March 3, 2014 order … Continue Reading

U.S. Supreme Court: SLUSA Does Not Preempt Stanford Ponzi Scheme Victims’ State Law Claims

Posted in Securities Litigation
The state law fraud claims of certain victims of the Stanford Ponzi scheme against various law firms and brokerage firms are not precluded under the Securities Litigation Uniform Standards Act (“SLUSA”) and plaintiffs therefore may pursue their state law class actions against the defendants, according to a February 26, 2014 decision from the U.S. Supreme … Continue Reading

The Sins of the Past: Ninth Circuit Revives BP’s Prudhoe Bay Oil Spill Securities Suit

Posted in Securities Litigation
In a February 8, 2014 article entitled “A Shrunken Giant” (here), the Economist magazine examined BP’s efforts to regain its footing after the disastrous April 2010 Deepwater Horizon explosion and oil spill. The article concludes by stating that “Repairing the balance sheet and books is one thing. Repairing BP’s reputation for management excellence will take … Continue Reading

Cornerstone Research: Securities Suit Filings Increase in 2013, Filing Rate Above Historical Averages

Posted in Securities Litigation
Considered on an absolute basis, securities class action lawsuit filings were up about nine percent in 2013 compared to 2012, although the number of 2013 lawsuits was about 13 percent below annual filings averages for the years 1996-2012, according to a new report from Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse. … Continue Reading

More About Follow-On Securities Litigation After Overseas Investigative Actions

Posted in Securities Litigation
In my year-end survey of corporate and securities litigation, one of the trends I noted regarding the litigation that had been filed in 2013 was the rise in lawsuit filings following in the wake of governmental investigations and regulatory actions, particularly with respect to investigations and regulatory actions outside the United States. If two recently … Continue Reading

NERA Releases 2013 Securities Class Action Litigation Report

Posted in Securities Litigation
Securities class action lawsuit filings “saw a small increase” during 2013, while securities class action settlements reflected a dynamic in which “large settlements got larger and smaller settlements got smaller” during the year, according to the annual report from NERA Economic Consulting. The January 21, 2014 report, entitled “Recent Trends in Securities Class Action Litigation: … Continue Reading

Litigation Funding in the Courts

Posted in Securities Litigation
Third-party litigation funding continues to attract investors, as evidenced by relatively new litigation funding firm  Gerchen Keller Capital’s recent $260 million capital raise, which brings their total investor commitments to $310 million (as discussed in a January 12, 2013 New York Times article, here). As litigation has become more prevalent, courts have had to grapple … Continue Reading

Guest Post: More than a Machine: “Robocop” Stole the Headlines, but the Financial Reporting and Audit Task Force is the Real Driver Behind the SEC’s Refocus on Accounting Irregularities

Posted in Securities Litigation
As noted in a recent guest post on this site (here), the SEC recently announced the so-called “Robocop” initiative to try to detect improper or fraudulent financial reporting. However, as the authors of the prior post explain in a second guest post below, the Robocop initiative is one of two efforts the agency recently launched … Continue Reading

Takeover Litigation in 2013

Posted in Securities Litigation
One of the most distinctive corporate and securities litigation trend in recent years has been the surge in M&A-related litigation, with virtually every deal attracting at least one lawsuit. This trend continued again in 2013, according to a recently updated study from Notre Dame business professor Matthew Cain and Ohio State law professor Steven Davidoff. … Continue Reading

Dump “Fraud on the Market” Yet Preserve Securities Plaintiffs’ Ability to Establish Reliance?

Posted in Securities Litigation
Since the U.S. Supreme Court agreed to revisit the “fraud on the market” theory by granting cert in the Halliburton case a few weeks ago, many commentators (including this blog) have considered whether the Court might wind up taking an intermediate position that addresses criticisms of the theory while preserving securities plaintiffs’ ability to try … Continue Reading

Securities Lawsuit Filings Up Slightly in 2013

Posted in Securities Litigation
The number of securities class action lawsuit filings was up slightly in 2013 compared to 2012, although the 2013 filings remained well below historical averages. While securities litigation picked up in 2013 compared to the year before, the more interesting question going forward is what the impact of the Halliburton case now pending before the … Continue Reading

Guest Post: Bankruptcy in Securities Class Actions: Case Outcomes, Individual Liability and Side A Protection

Posted in Class Action Settlements, Securities Litigation
Of the different contexts within which securities class action lawsuits arise, one of the most significant is the bankruptcy context. As detailed in the following guest post from Michael Klausner and Jason Hegland of Stanford Law School, securities class action lawsuit arising in bankruptcy are different from cases involving solvent companies. Their guest post provides … Continue Reading

Guest Post: “Robocop” on the Beat:What the SEC’s New Financial Reporting and AQM Initiative May Mean for Public Companies

Posted in Securities Litigation
With the arrival of the new Chair of the SEC, Mary Jo White, the agency has undertaken a variety of new enforcement initiatives. Among the most interesting is the agency use of data anallytics to try to uncover public company accouunting abuses. The following guest post from Christopher L. Garcia, Paul Ferrillo  of the Weil, … Continue Reading

Shareholders Obtain $882 Million Default Judgment in Longtop Financial Securities Suit

Posted in Securities Litigation
During the period 2010 to 2012, plaintiffs’ lawyers rushed to file a wave of securities suits against U.S.-listed Chinese companies. In general, the cases filed as part of this wave that have reached the settlement stage have settled for relatively modest amounts. However, at least one of these cases has now resulted in an absolutely … Continue Reading

SEC Releases Fiscal 2013 Whistleblower Report

Posted in Securities Litigation
Whistleblower reports to the SEC continued to rise during the latest fiscal year, according to the agency’s annual Dodd-Frank Whistleblower Program report to Congress. According to the November 15, 2013 report, a copy of which can be found here, there were 3,238 whistleblower reports to the SEC during the 2013 fiscal year, brining the total … Continue Reading

Game Changer? The U.S. Supreme Court to Revisit “Fraud on the Market” Presumption

Posted in Securities Litigation
In a development that has the potential to change the way private securities suits in the United States are litigated, the U.S. Supreme Court has agreed to take up a case in which the petitioners seek to have the Court revisit the “fraud on the market” presumption. The presumption allows plaintiffs in securities suits under … Continue Reading

Whistleblower Report Follow-On Securities Suit: We’ll Be Seeing More of These

Posted in Securities Litigation
On October 30, 2013, the SEC announced  another whistleblower bounty award under the Dodd-Frank whistleblower program. Although the size of this latest award ($150,000) is relatively modest compared to the recent $14 million award (about which refer here), the most recent award does suggest that awards under the whistleblower program are gaining momentum.   I … Continue Reading

SEC Releases Proposed Crowdfunding Rules

Posted in Securities Litigation
On October 23, 2013, the SEC finally approved (unanimously) and released for public comment the proposed rules implementing the crowdfunding provisions of the JOBS Act. The rules will not become effective, subject to any revisions, until the end of a 90-day comment period, meaning that the rules will not go into effect until some time … Continue Reading

Dodd-Frank Anti-Retaliation Provisions Don’t Protect Overseas Whistleblower

Posted in Securities Litigation
When the SEC Whistleblower Office presented its first full fiscal year annual report last November, the agency reported that 324 (or 10.8%) of the 3,001 whistleblower reports the agency received came from whistleblowers outside the United States. This statistic suggested that the Dodd-Frank whistleblower provisions could lead to the revelation of financial misconduct overseas, and … Continue Reading

Record $2.46 Billion Post-Verdict Judgment Entered in Long-Running Household International Securities Suit

Posted in Securities Litigation
O.K., here’s something – on October 17, 2013, Northern District of Illinois Judge Ronald Guzman entered a post-verdict judgment in the long-running Household International securities class action lawsuit. The judgment award consisted of principal damages of $1,476,490,844.21 and prejudgment interest of $986,408,772, for a total judgment amount of $2,462,899,616.21, along with post-judgment interest and taxable … Continue Reading