The U.S. Supreme Court’s landmark April 2, 2007 decision in Massachusetts v. EPA (here) may represent a turning point in the evolving governmental response to global warming. As discussed below, the decision itself and the regulatory, legislative and litigation consequences that will likely follow could have important implications for many publicly traded
Options Backdating Settlement
As the list of options backdating lawsuits has grown ever longer (refer here), one question has been: where will it all lead? Sooner or later, these cases will all have to be resolved, but so far it has remained unclear what the resolution might look like. A recent settlement in the derivative cases filed
Houses of Glory, Mansions of Shame: CEOs’ Homes and Corporate Performance
It is now a well-established part of the mythology of American capitalism that Warren Buffett still lives in the same modest brick colonial in Omaha, pictured above, that he bought in 1958 for $31,000. (According to Forbes magazine’s annual survey of billionaires’ houses, here, Buffett’s home had a 2003 tax valuation of $700,000.) Intuitively,
A New Era in Hedge Fund Litigation?
When the giant hedge fund Amaranth imploded in late September 2006 in the largest hedge fund failure ever, it made the front page of the Wall Street Journal (here, subscription required). Amaranth lost more than $6 billion after the natural gas bet of one of its traders, Brian Hunter, took a severely wrong
Cornerstone Releases Study of 2006 Securities Class Action Settlements
On March 21, 2007, Cornerstone Research released its analysis of 2006 securities class action settlements (here). Cornerstone had previously released its study of 2006 securities class action filings (here). NERA Economic Consulting also previously released its analysis of 2006 securities class action filings and settlements (here). Cornerstone’s study differs
Another Call to Eliminate Private Securities Lawsuits
Amidst the current clamor over the competitiveness of the U.S. financial markets, a recurring theme has been the burden on the financial markets of U.S. litigiousness. One variant of this theme that has gotten air time is the idea that private securities lawsuits should be eliminated. The most prominent proponent of this idea is Stanford
Rule 10b5-1 Plans Drawing Scrutiny
Those who remember that the options backdating scandal first got started with an academic study may want to take a close look at a recent research paper examining Rule 10b5-1 plan trading. The paper, and subsequent press coverage and comments, suggest that questionable trading in Rule 10b5-1 plans could become the focus of the next
Section 11 Settlement Held Not Insurable “Loss”
On March 14, 2007, in a decision that has important implications for D & O insurers and their policyholders, Judge Gregory Presnell of the federal court in Orlando granted partial summary judgment on behalf of two excess D & O insurers, holding that the $35 million settlement to which CNL Hotels & Resorts agreed to
Options Backdating: Sue the Gatekeeper?
Way back in 2003, long before any of the rest of us had ever heard of options backdating, Micrel sued its former auditor, Deloitte and Touche, alleging that the accounting firm had given the company faulty advice regarding its options grant practices. In its recently filed 2006 10-K (here), Micrel dislosed that
Court’s Friends Spar Over Tellabs
Led by Marc Dann, the recently elected Democratic Attorney General of Ohio, the attorneys general for 22 states, plus the attorneys general for Puerto Rico and American Samoa, have filed an amicus brief (here) in the Tellabs case pending before the U.S. Supreme Court. The states’ brief strongly disagrees with the