It has now been over three years since the first subprime-related securities class action lawsuit was filed in February 2007, yet many of the cases filed in the ensuing litigation wave are still only in their earliest stages. While the vast majority of these cases are still unfolding, there have been some important recent developments
Restatements Decline – Again
Both the number of restatements and the number of companies reporting restatements are declining according to a new study. The number of restatements has been declining for three years now, and the number has declined materially since the figures peaked in 2006, both because of better controls and changing standards.
The study, by
Madoff Feeder-Fund Survives Dismissal Motion
An astonishing amount of litigation followed in the wake of the Madoff scandal revelations, as I have detailed here. But thought the litigation filings have surged, the question remains whether the plaintiffs’ desperate attempts to recover their losses from third parties have any chance of success.
This question was underscored by the March
Corporate Penalties and the SEC
The SEC first acquired the right to impose civil penalties against corporations in the Securities Enforcement Remedies and Penny Stock Reform Act of 1990. Since the Remedies Act was enacted, the SEC has struggled with the question of when it is appropriate to obtain money penalties from corporate issuers.
In January 2006, in
More About the Responsible Corporate Officer Doctrine
Time-honored legal principles typically shield corporate officers and shareholders from direct personal liability for legal violations of the corporation itself, consistent with the notion that the corporation itself has a distinct and separate legal identity. However, as I noted in a prior post (here), courts have evolved a concept called "the responsible corporate
Book Review: “Circle of Greed” – The Rise and Fall of Bill Lerach
During his long and provocative legal career, former class action securities litigator and convicted felon Bill Lerach was a self-selected lightening rod for controversy. He taunted his foes, stalked his enemies, challenged convention, and in the process transformed himself into a larger than life figure.
And so when his legal career collapsed among revelations
A Closer Look at Buffett’s Letter to Berkshire Shareholders
The much-anticipated annual letter to Berkshire Hathaway shareholders of its Chairman Warren Buffett has long been valued for its business insights and occasionally humorous tone. The 2009 version, which was released on Saturday February 27, 2010, and which can be accessed here, is no exception, though the expanding size of Berkshire’s business portfolio has
Rating Agencies’ Alleged Conflicts of Interest Held Immaterial
In a ruling that may have potential significance for the many claims that have been filed against the rating agencies in the subprime litigation wave, on February 17, 2010, Southern District of New York Judge Lewis Kaplan dismissed all but one of the claims that had been filed against the individual defendants in the Lehman
MoneyGram Settles Subprime-Related Securities Suit for $80 Million
In one of the largest subprime-related securities lawsuit settlements so far, Moneygram Corporation has agreed to settle its subprime-related securities class action and accompanying derivative suit for $80 million, according to the company’s February 25, 2010 press release (here).
Background
As reported here, the MoneyGram case represented the distinct group of
FDIC: Number of “Problem” Banks Continues to Grow
As of year-end 2009, the FDIC identified 702 banks as "problem institutions," representing about 9% of all institutions reporting to the FDIC and the highest number of problem banks since 1993, according to the FDIC’s latest banking report.
On February 23, 2010, the FDIC released its Quarterly Banking Profile for the fourth quarter 2009