1. As I have previously noted, the elevated number of securities class action lawsuits against life sciences companies was an important factor in the increase of securities lawsuit filings in 2017. The significant volume of securities suits involving life sciences companies has been the subject of focused analysis, as discussed here. Now the Sidley Austin law firm has released its exhaustive review of the 2017 securities litigation against life sciences companies. Among other things, the report finds that while the numbers of securities suit filings against life sciences companies has increased in recent years, the companies are faring worse at the dismissal motion stage in the district courts relative to the most recent years. The report summary can be found here. The full report can be found here. Continue Reading Another Look at 2017 Securities Litigation Against Life Sciences Companies

Among the many problems that have come to light in the current cryptocurrency craze have been problems relating to celebrity endorsements for initial coin offerings (ICO). In the following guest post, John Reed Stark, President of John Reed Stark Consulting and former Chief of the SEC’s Office of Internet Enforcement, reviews the highest profile examples of cryptocurrency celebrity endorsements, and then proposes a list of cryptocurrency caveats, for celebrities and for everyone else as well. A version of this article originally appeared on Cybersecurity Docket. I would like to thank John for his willingness to allow me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is John’s guest post. Continue Reading Guest Post: Ten Crypto-Caveats Floyd Mayweather and DJ Khaled Should Have Heard From Their Lawyers

One of the most interesting global legal developments has been the rise in recent years of collective redress mechanisms outside the United States, a phenomenon on which I have commented in the context of collective investor actions. The provision for collective or representative actions has expanded in a number of other contexts as well, including in particular in the consumer context. On April 11, 2018, the European Commission introduced a proposal – as part of what it called a “New Deal for Consumers” – that would introduce a European collective redress right for consumers. This proposed collective action mechanism is subject to a number of procedural protections. Nevertheless, the proposal, if adopted, would represent a significant advance in the development of collective redress mechanisms and rights in Europe. The European Commission’s April 11, 2018 press release about the proposal can be found here. Continue Reading European Commission Proposes Consumer Collective Redress Mechanism

The fallout from the current wave of revelations sexual misconduct involving media figures, politicians, and corporate executives has included, among other things, a rash of D&O claims – including, for example, claims against the boards of 21st Century Fox and Wynn Resorts. An interesting recent scholarly paper takes a detailed look at D&O claims arising out of allegations of sexual misconduct, examines the potential bases of liability, and considers the relative social utility of this kind of litigation, as well as the practical implications for corporate boards and their organizations. The March 22, 2018 paper by Daniel Hemel and Dorothy Lund of the University of Chicago Law School and entitled “Sexual Harassment and Corporate Law” can be found here. The authors summarize their paper in an April 9, 2018 post on the CLS Blue Sky Law Blog (here). Continue Reading Sexual Misconduct and D&O Claims

Among the many innovations we have had to confront in a world characterized by rapid technological change is the advent of cryptocurrency, as a social and financial phenomenon. As I have previously noted, the current cryptocurrency craze has also become a legal phenomenon as well, as now nearly a dozen securities class action lawsuits involving cryptocurrency, ICOs, and blockchain technology have been filed just in the last six months or so. The latest of these lawsuits  — one involving allegations relating to an Italian cryptocurrency exchange operator nicknamed “The Bomber” and including investor demands for the court to compel a “rescue fork” — may suggest that in addition to technological change, the advent of cryptocurrency could introduce legal changes as well. Continue Reading Cryptocurrencies: New Digital Assets, New Legal Issues?

Between 1996 and 2016, the number of U.S. listed companies declined by about 50 percent. There are now fewer U.S. listed companies than there were in 1976. Some observers have raised the alarm about this decline. For example, SEC Chair Jay Clayton in a speech last summer called the decline in the number of U.S. listed companies “a serious issue for our markets and the country.” But before we can decide whether or not the lower number of public companies is a problem, much less what to do about it, we need to take a look at what is happening and why it is happening. A closer look suggests that the situation is more complex than it might appear at first glimpse. Continue Reading Fewer U.S. Listed Companies – Is That a Problem?

As I have previously noted (for example here), a number of reports have analyzed the 2017 approved securities class action lawsuit settlements in statistical and numeric terms, such as the aggregate, average, and mean settlement amounts. But what do the 2017 securities suit settlements look like when broken down according to the lead plaintiffs’ firm that negotiated the settlement? An April 4, 2018 study from ISS Securities Class Action Services entitled “The Top 50 of 2017” (here) takes a look at this issue and reports some interesting conclusions, discussed below. The organization’s April 4, 2018 press release can be found here. Continue Reading Ranking the Plaintiffs’ Firms by 2017 Shareholder Recoveries

It is axiomatic in the current global economy that every business needs to have a China strategy. Most business enterprises are drawn to the world’s most populous country and second-largest economy. But while China represents an attractive business marketplace, it can also in many respects be a perilous place to try to do business, particularly from a regulatory and compliance standpoint. While most businesses may recognize these challenges, many may struggle to try and address the concerns. A new book entitled “Governance, Risk and Compliance Management in China” (here), which I review below, may provide substantial help to companies trying to address compliance concerns arising from doing business in China. Of particular interest to this blog’s readers, the book includes an interesting chapter on D&O insurance issues in China.   Continue Reading Book Review: Governance and Risk Management in China

As the use of third-party litigation funding has become more widespread, one issue that has been debated is whether or not the existence and details of a funding arrangement must be disclosed to the adversarial parties. As I have noted in prior posts, courts have struggled with the question of whether or not funding arrangements must be disclosed under existing discovery rules. A number of proposals providing for mandatory disclosure of litigation funding arrangements have been proposed. Now, Wisconsin has become the first state to adopt a provision requiring the disclosure of litigation funding arrangements. The state’s action is just the latest step in what seems to be a general move toward requiring disclosure. Continue Reading Wisconsin Become First State to Mandate Disclosure of Litigation Funding Arrangements

One of the changes Congress introduced in the Jumpstart our Business Startups (JOBS) Act of 2012 was the creation of a new securities offering exemption for smaller companies. In March 2015, the SEC introduced rules implementing this provision, known as Regulation A+. The track record for Reg. A+ offerings has been mixed, as discussed further below. Recent events involving Longfin Financial, a blockchain fintech company that just completed a Reg. A+ offering in December 2017 highlights many of the questions and concerns about Reg. A+ offerings. Longfin’s share price plunged over 80% after the company announced on Monday that its offering and a subsequent acquisition are the subject of an SEC investigation. Now the company has been hit with a securities class action lawsuit. As discussed below, these recent developments have a number of implications. Continue Reading Fintech Company Hit with Securities Suit Completed Reg. A+ Offering in December