The number of federal court securities class action lawsuit filings in the year’s first half reflected a filing pace that projects year-end numbers ahead of last year’s full-year totals.Continue Reading 1H24 Securities Suit Filings Project YE Totals Ahead of Last Year’s Pace
The United States Supreme Court has held that that, in light of the Seventh Amendment’s right to a jury trial, the SEC must pursue enforcement actions seeking civil penalties in a jury trial proceeding in federal court rather than in an action before an administrative law judge. The Court’s 6-3 ruling could have significant consequences for the many SEC enforcement actions now pending in the agency’s administrative tribunals, as well as for the agency’s pursuit of future enforcement actions. The Court’s ruling could also have important implications for other federal agencies’ use of administrative tribunals as well. A copy of the Court’s June 27, 2024, opinion in SEC v. Jarkesy can be found here.Continue Reading Supreme Court Strikes Down SEC’s Use of Administrative Law Judges in Civil Penalty Actions
Just weeks before trial in the case was scheduled to being, the parties to the Under Armor securities class action lawsuit have agreed to settle the case for $434 million, according a company SEC filing. The case had recently survived the defendants’ motion for summary judgment. According to the lead plaintiffs’ counsel, the settlement represents the second-largest securities suit settlement in the Fourth Circuit. The settlement is subject to court approval. A copy of the company’s June 21, 2023, filing on Form 8-K can be found here. Plaintiffs’ counsel’s June 21, 2024, press release about the settlement can be found here.Continue Reading Under Armour Securities Suit Settles for $434 Million
Regular readers know that a recurring topic on this site is the question of the proper scope of the contractual liability exclusion found in many professional liability and management liability insurance policies. In prior posts I have argued that insurers sometimes apply the exclusion over-broadly so as to exclude matters I believe should otherwise be covered under the policy.
A recent Second Circuit, applying New York law, again examined the scope of the contractual liability exclusion’s preclusive effect, rejecting a policyholder’s claim that the exclusion did not apply to an underlying declaratory judgment claim, one of several claims asserted against the company in the underlying action. Although I often disagree with courts’ conclusions about the reach of the contractual liability exclusion, in this case the appellate court appears to have gotten it right, given the policy language at issue, in affirming the district court’s exclusion precludes coverage for the declaratory judgment claim. A copy of the Second Circuit’s June 17, 2024, opinion can be found here. (Hat tip to Paul Curley of the Kaufman Borgeest & Ryan law firm, for his June 21, 2024 LinkedIn post, here, about the decision.)Continue Reading Contractual Liability Exclusion Precludes Coverage for Declaratory Judgment Claim
As AI becomes an ever-more present component of many companies’ strategies and operations, one concern is the extent to which this technological shift could affect companies’ litigation risk exposures. One risk companies may face is that in seeking to promote their adoption of AI strategies, companies may be susceptible to allegations that they overstated their AI capabilities or the extent to which the strategies will actually improve results.Continue Reading Robotic Automation Company Hit With AI-Related Securities Suit
The D&O Diary completed its European tour this week with a stop in the Bavarian city of Munich, known to the locals as München. It is always great to visit Munich but it is particularly nice this time of year. It is such a green, outdoor-oriented city and in the summer sunshine the city vibrates with life. Continue Reading Munich
The D&O Diary’s European travels continued with a stop in Riga, Latvia’s capital city and the largest city in the Baltic states. Located on the Daugava River where it meets the Baltic Sea, Riga is a level, walkable city full of interesting architecture and beautiful parks.Continue Reading Riga
The D&O Diary’s European travels continued with a visit over the weekend to Vilnius, Lithuania’s capital city. Vilnius has long history, a prosperous feel, and a very cool vibe. Vilnius may not be the first city many Americans think of when they think of Europe, but it truly is a special place.Continue Reading Vilnius
Just days after the U.S. Supreme Court agreed to take up the Facebook/Cambridge Analytica securities case concerning risk factor disclosures (as discussed here), the Court has now agreed to take up yet another securities case, this time in a case involving Nvidia and involving the standards for pleading scienter and falsity under the PSLRA. The NVIDIA case involves alleged fraud in connection with the company’s disclosures concerning its sales of graphics processing units (GPU) to cryptocurrency companies as a component of its overall GPU sales. The specific questions the case presents to the Supreme Court concern what and how a plaintiff must plead when pleading scienter and falsity. Because the case involves the PSLRA’s “exacting pleading requirements,” the case potentially could prove to be very significant. A copy of the Court’s June 17, 2024 Order granting the petition for writ of certiorari can be found here.Continue Reading Supreme Court Agrees to Take Up Nvidia Securities Suit On Pleading Standards Issues
The D&O Diary is on assignment in Europe, with a first stop in the beautiful Portuguese city of Lisbon (known to the locals as Lisboa). Travel can take you lots of places, but if you are really fortunate, travel will take you to Lisbon, one of the world’s great places and one of The D&O Diary’s all-time favorite destinations.Continue Reading Bela Lisboa