The recent annual trend toward declining numbers of corporate and securities lawsuit filings continued in the first half and second quarter of 2015, although second quarter activity did increase slightly compared to the prior quarter, according to a report from the insurance industry information firm, Advisen. If the increase in the second quarter numbers compared to the first were to continue for the remainder of the year, the number of new corporate and securities lawsuits during the year could see an annual increase for the first time in four years. The July 15, 2015 Advisen report, entitled “D&O Claims Trends: Q2 2015” can be found here.
Continue Reading Advisen Report: Declining Corporate and Securities Litigation Filings Continued in Second Quarter, But Most Recent Quarterly Trend May be Upward
Another U.S. Securities Suit Arising from Overseas Corruption Investigation
In an earlier post, I noted that a significant factor driving securities litigation filings so far this year has been the rising number of U.S. securities lawsuits involving non-U.S. companies. A number of different factors are contributing to the filing of these suits, but among the factors is the increasing numbers of U.S.-listed non-U.S. companies that have been caught up in corruption investigations in their home countries.
The highest profile company among the firms involved in corruption probes is the Brazilian petroleum company, Petrobras, which has been the target of growing Operação Lava Jato (Operation Car Wash) corruption investigation in Brazil. Petrobras, whose ADSs trade on the NYSE, was hit with a class action securities lawsuit in the U.S. in December 2014 (as discussed here).
The continuing Petrobras investigation has spread to a number of other Brazilian companies. Among other things, the investigation has led to the recent arrests of two high profile executives in the construction industry in Brazil, as discussed here. The leaders of the nation’s two largest engineering and construction companies, Marcelo Odebrecht, head of Odebrecht SA, and Otavio Marques Azevedo, head of Andrade Gutierrez, were taken into custody in raids linked to the Petrobras scandal.
The investigation has now led to yet another U.S. securities class action lawsuit against yet another Brazilian company. On July 1, 2015, a plaintiff shareholder filed a securities class action lawsuit in the Southern District of New York against Braskem, S.A. and certain of its directors and officers. Braskem, which is based in Brazil, is Latin America’s largest petrochemical company.
Continue Reading Another U.S. Securities Suit Arising from Overseas Corruption Investigation
An Active First Half for Securities Class Action Litigation
The first half of 2015 was an active period for new securities class action lawsuit filings. The filings through the year’s first six months suggest we are on pace for the highest annual number of new filings since 2011. The heightened levels of lawsuits involving non-U.S. companies and IPO companies contributed to the uptick in securities suit filings in the year’s first half.
Continue Reading An Active First Half for Securities Class Action Litigation
Guest Post: New York’s Highest Court Brings Finality to RMBS Repurchase Claims
On June 11, 2015, in a closely watched case, the New York Court of Appeals, New York’s highest court, decided when the statute of limitations begins to run for claimants alleging breaches of the representations and warranties provisions in residential mortgage backed securities.
As Robert Fumerton and Alexander Drylewski of the Skadden, Arps, Slate Meagher
Year-to-Date Securities Suit Filings Disproportionately Involve Non-U.S. Companies
Historically, non-U.S. companies listed on U.S. exchanges were sued in securities class action lawsuits less frequently than were listed U.S. companies. For several years now, according to NERA, non-U.S. firms have represented about 16% of all companies listed on the U.S. exchanges, but according to Cornerstone, for the period 1997-2013, the average percentage
Seventh Circuit Sets Aside Record $2.46 Billion Judgment in Long-Running Household International Securities Suit
On October 17, 2013, when Northern District of Illinois Judge Ronald Guzman entered a $2.46 billion judgment for the plaintiffs in the long-running Household International securities class action lawsuit, it was according to statements at the time the largest judgment ever in a securities fraud trial. However, on May 21, 2015, the Seventh Circuit
Guest Post: ACE Securities – Will There Be a New Wave of RMBS Repurchase Litigation?
On April 30, 2015, the New York Court of Appeals heard oral argument in a mortgage-backed securities-related case in which the court must consider when the statute of limitations begins to run for claims of breach of contractual representations and warranties. The range of possible outcomes of the case include an interpretation of the statute
Securities Suits Hit Companies Using Stock Promoters
When plaintiffs’ lawyers filed a complaint against the company earlier this week, Cellular Biomedicine Group became the latest firm to be hit with a securities class action lawsuit relating to the company’s alleged use of a stock promotion firm. There were a number of companies hit with similar lawsuits last year, as I noted at
Advisen Report: Decline in Corporate and Securities Lawsuit Filings Continued in First Quarter
The recent trend toward declining numbers of corporate and securities lawsuit filings continued in the first quarter of 2015, according to a report from the insurance industry information firm, Advisen. If the level of activity in the year’s first quarter were to continue for the rest of the year, the number of new corporate and
Are Event Studies in Securities Litigation Reliable?
In its June 2014 opinion in the Halliburton case, the U.S. Supreme Court held that securities lawsuit defendants may introduce evidence at the class certification stage to try to show that the alleged misrepresentation on which the plaintiffs rely did not impact the defendant company’s share price. To show the absence of price impact, defendants