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

Advisen Releases 2014 First Half Corporate and Securities Litigation Report

Posted in Securities Litigation
The level of all corporate and securities filings continued to decline in the second quarter of 2014 as filing activity returns to levels that prevailed before the financial crisis, according to the latest quarterly D&O claims activity report of Advisen. According to the report, filing levels in the second quarter reflected the “fewest securities and … Continue Reading

Halliburton: U.S. Supreme Court Declines to Overturn Basic, Allows Defendants to Rebut Presumption of Reliance

Posted in Securities Litigation
On June 23, 2014, the U.S. Supreme Court released its long-awaited decision in Halliburton Co. v. Erica P. John Fund, in which the Court had taken up the question whether or not to set aside the presumption of reliance based on the fraud on the market theory that the Court first recognized in its 1988 … Continue Reading

Second Circuit Vacates Judge Rakoff’s Rejection of SEC’s Citigroup Settlement

Posted in Securities Litigation
On June 4, 2014, in a long-awaited but not unexpected opinion (here), the Second Circuit ruled that Southern District of New York Judge Jed Rakoff had improperly rejected the $285 million settlement of the SEC’s enforcement action against Citigroup. Because the case involved the question of whether or not parties may enter into “neither admit … Continue Reading

Applying Morrison, Second Circuit Affirms UBS Credit Crisis Securities Suit Dismissal

Posted in Securities Litigation
After the U.S. Supreme Court issued its opinion in Morrison v. National Australia Bank, the plaintiffs’ lawyers developed a number of theories to try to circumvent Morrison to assert claims under the U.S. securities laws on behalf of investors who purchased their shares in the defendant foreign company on a foreign exchange. These theories – … Continue Reading

Cornerstone Research Releases 2013 Analysis of Securities Suits Involving Accounting Allegations

Posted in Securities Litigation
Though the number of securities class action lawsuit containing accounting allegations remained essentially the same in 2013 compared to 2012, the market capitalization losses associated with the 2013 suits were more than double the losses associated with the 2012 suits, according to a new report from Cornerstone Research. The report contains a brief analysis of … Continue Reading

Advisen Releases First Quarter 2014 Corporate and Securities Litigation Report

Posted in Securities Litigation
Overall Filings of corporate and securities lawsuits during the first quarter of 2014 were at their lowest levels since before the financial crisis, according to the latest report from Advisen, the insurance information firm. The April 2014 report, which is entitled “D&O Claims Trends: 2014,” can be found here. As discussed below, the report will … Continue Reading

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