In a June 13, 2011 opinion written by Justice Clarence Thomas, the United States Supreme Court held, by a 5-4 margin, in the Janus Capital Group, Inc. v. First Derivative Traders case, that a mutual fund management company cannot be held liable for the alleged misstatements in the prospectuses of the mutual funds that
Predicting the Supreme Court’s Decision in Janus
As the current Supreme Court term gets ready to draw to a close, many court observers are awaiting the Court’s decision in the Janus Capital case (background here). With the opinion due to be released any day now, I am pleased to be able to publish here a guest post from Brian Lehman
Securities Litigation: Variations on a Chinese Theme
One of the most distinct securities litigation filing trends during the last twelve months has been the filing of securities class action law suits against U.S.-listed companies based or operating in China. With a phenomenon this well-established, it is only natural that the trend should begin to evolve, which seems to be what has happened
Confidential Witness Statements Lead to Dismissal Motion Denial in Regions Financial Subprime Securities Lawsuit
In a decision that largely turned on detailed confidential witness statements, on June 7, 2011, Northern District of Alabama Judge Inge Prytz Johnson denied the motions to dismiss in the Regions Financial Corporation subprime-related securities lawsuit. This ruling is the latest of a series of decisions involving the company. The June7 ruling can be found
Supreme Court Reverses Fifth Circuit in Halliburton Case; Proof of Loss Causation Not Required At Class Certification Stage
As many observers had expected, the U.S. Supreme Court has reversed the Fifth Circuit’s opinion in the Halliburton case. In a brief June 6, 2011 opinion from Chief Justice John Roberts, writing for a unanimous court, the Court held that securities class action lawsuit plaintiffs do not need to prove loss causation in order
The Latest Chinese Accounting Fraud Lawsuit and Other Net Threads
Yet another U.S.-traded Chinese-based company has been hit with an accounting fraud securities class action lawsuit. The latest lawsuit, involving Longtop Financial Technologies Limited, comes after a series of stunning announcements from the company earlier this week.
Longtop’s ADRs trade on the NYSE and until recently the company had a market cap in
Dealing with Multi-Jurisdiction M&A Litigation
One of the most distinctive trends in corporate and securities litigation in recent years has been the rise in litigation related mergers and acquisition activity. Cornerstone Research’s most recent year-end litigation filing study, released in conjunction with the Stanford Law School Securities Class Action Clearinghouse, documented that in M&A litigation in 2010 increased
So, There’s Concurrent State Court Jurisdiction for ’33 Act Suits, Right? Well…
On May 18, 2011, the California Intermediate Court of Appeals held in the Luther v. Countrywide Financial Corporation case that state courts have concurrent jurisdiction with federal courts to hear liability lawsuits under the Securities Act of 1933, and that more recent legislative enactments did not eliminate the concurrent state court jurisdiction for the plaintiffs&rsquo
Failed Bank-Related Securities Lawsuits: A Dismissal and A Settlement
One of the ways in which the current wave of bank failures is different from the failures during the S&L crisis is that this time around, by comparison to that prior period, a number of the bank closures have been accompanied by shareholder lawsuits brought against the former directors and officers of the failed institutions.
Second Circuit Holds Rating Agencies Cannot Be Held Liable as ’33 Act Underwriters
In a May 11, 2011 opinion (here), a three-judge panel of the Second Circuit affirmed the dismissal of rating agency defendants in litigation filed under the Securities Act of 1933 and involving mortgage-related securities issues by Lehman Brothers and IndyMac and the Residential Asset Securitization Trust (RUST). The Second Circuit affirmed the District Court’s