Surging levels of M&A-related litigation and a wave of lawsuits involving U.S.-listed Chinese companies drove federal securities class action lawsuit filings during 2011 to the highest levels since 2008. However, due to the growing wave of M&A-related litigation, much of which is filed in the state courts, the federal securities lawsuit filing statistics, while interesting
M&A-Related Litigation Has Replaced Stock Drop Suits as Plaintiffs’ Securities Lawyers’ Lawsuit of Choice
In a prior post (here), I examined the mounting problems associated with the increasing levels of M&A-related litigation. A recent academic paper takes a closer look at these issues and concluded, among other things, that M&A-related lawsuit filings now outnumber federal securities class action lawsuit filings, and M&A-related litigation has “replaced traditional stock
Canada’s Highest Court Rules Proposed Federal Securities Regulator Unconstitutional
A legislative proposal to create a single federal Canadian securities regulator is unconstitutional, the country’s highest court has ruled. In a December 22, 2011 opinion (here), the Supreme Court of Canada ruled unanimously in an advisory opinion that the Act to create a single, unified securities regulator “as presently drafted” is not a
E*Trade Settles Subprime Securities Suit for $79 Million
E*Trade Financial Corporation has reached an agreement in principle to settle the subprime-related securities class action lawsuit pending against the company and certain of its directors and officers, the company reported in its December 21, 2011 filing on Form 8-K. The agreement calls for the company and its D&O insurance carriers to pay a total
NY Court of Appeals Rejects Martin Act Preemption of Common Law Securities Claims
A long-standing question under New York law is whether the state’s Martin Act preempts private claimants’ efforts to bring non-fraud common law claims in the securities context. A well-developed body of case law has generally held that it does, although recently some judges questioned this conclusion.
In a December 20, 2011 opinion (here
A Closer Look at the WaMu FDIC Settlement
The well-publicized settlement this past week of the FDIC’s lawsuit against three former officers of the failed WuMu bank was widely reported as having a value of $64.7 million. A closer look at the parties’ December 15, 2011 settlement agreement reveals some interesting details about the settlement, including the specifics of how the FDIC came
BNY Mellon Hit with Securities Suit Following Whistleblower Allegations
With the implementation of potentially rich whistleblower bounties under the Dodd-Frank Act, there have been concerns that the incentives will not only lead to increased numbers of reports and increased enforcement activity, but that the regulatory action will in turn generate follow-on civil litigation. A securities class action lawsuit filed this past week against Bank
Designing a New Playbook for the New Paradigm: Global Securities Litigation and Regulation
As a result of legal changes taking place in many countries around the world, as well as U.S. Supreme Court case law developments, questions involving the possibility of securities litigation outside the U.S. has become an increasingly high profile issue. In a guest post, Robert F. Carangelo, Paul A. Ferrillo and Catherine Y. Nowak
NERA Releases Year-End 2011 Securities Class Action Litigation Study
During 2011, elevated levels of M&A related litigation and the surge of litigation involving U.S.-listed Chinese companies offset declining numbers of credit crisis-related lawsuits, leading to overall levels of securities class action lawsuit filings consistent with recent years, according to a annual securities litigation study of NERA Economic Consulting. NERA’s December 14, 2011 report, entitled
D&O Insurance: “Disgorgement” Paid in SEC Settlement Held Not Covered
Carriers generally contend that insurance does not cover amounts that represent “disgorgement” or that are “restitutionary” in nature. But what makes a particular payment a “disgorgement”? In a December 13, 2011 opinion (here), the New York Supreme Court, Appellate Department, First Division, held that amounts Bear Stearns paid in settlement of SEC late trading