The number of securities class action lawsuits filed against life sciences companies in 2022 declined compared to 2021 but remained relatively steady as a proportion of the total number of securities class action lawsuits filed during the year, according to a new report from the Dechert law firm. The report, entitled “Dechert Survey 2022 Edition: Developments in Securities Fraud Class Actions Against U.S. Life Sciences Companies,” states that there were a total of 43 securities suits filed against life sciences companies in 2022, compared to 59 in 2021. The Dechert law firm’s February 23, 2023 press release about the report, which links to the full report,  can be found here.

Continue Reading Life Sciences Companies Remained Frequent Securities Suit Targets in 2022

In its latest annual report, ISS Securities Class Action Services reports that in 2022, for the third year in a row, the Robbins Geller law firm secured the highest dollar value in securities class action lawsuit settlements during the year and was also involved in the highest number of separate settlements. The report, which includes both U.S. and Canadian settlements, ranks the top 50 plaintiffs law firms by total dollar value recoveries, and the Top Ten plaintiffs law firms ranked by number of settlements achieved. The February 28, 2023, report, which is entitled “The Top 50 of 2022” and was written by Jeff Lubitz, Managing Director, ISS Securities Class Action Services, can be found here.

Continue Reading Report Ranks Top 50 Plaintiffs’ Firms by 2022 Securities Suit Settlement Values
Francis Kean

In a recent post, I discussed the lawsuit filed in a UK court by the environmental advocacy group ClientEarth against the board of Shell. In the following guest post, Francis Kean, Partner in Financial Lines Team at McGill and Partners, dives deeper into the legal context of the lawsuit and its insurance implications. I would like to thank Francis for allowing me to publish his article as a guest post on this site. I welcome guest post submissions from responsible authors of topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Francis’s article.

Continue Reading Guest Post: Client Earth Claim Against the Board of Shell: A Sign of Things to Come in the UK?  

As I noted in posts earlier this month (here and here), even though the COVID pandemic is about to enter its fourth year, COVID-related securities suits continue to be filed. The latest example is the securities class action lawsuit complaint filed late last week against pharmaceutical delivery device firm Catalent, a firm whose revenues soared at the in the early stages of the pandemic but whose fortunes lagged as the pandemic progressed. A copy of the February 24, 2023 complaint against the company can be found here.

Continue Reading Pharmaceutical Delivery Device Firm Hit with COVID-Related Securities Suit

It is frequently the case that my posts on this site occasion so little commentary that I often wonder whether anyone is reading them at all. Every now and then, though, one of my posts seems to stir things up a little bit. That was clearly the case with respect to a recent post in which I commented about the bump-up exclusion – the post has provoked quite a bit of conversation. In light of subsequent discussions I have had about the post, it appears that I should revisit some of the issues discussed in the post. For starters, I have revised parts of the prior post to take into account some of the observations about the post that have been made to me. In addition, I also note the following.

Continue Reading More Thoughts About the Bump Up Exclusion

As I noted in my recent year-end round up of the top D&O stories of 2022, one of the important trends last year was the volume of SPAC-related D&O litigation. Now, in what is the first SPAC-related securities suit of 2023, a plaintiff shareholder has launched a SPAC-related securities suit against satellite company Terran Orbital, related to the company’s March 2022 merger with a publicly-traded SPAC. Although the new lawsuit reflects the ongoing trend of SPAC-related lawsuit filings, the new lawsuit also has some unusual features, as discussed below. The February 17, 2023, complaint in the lawsuit can be found here.

Continue Reading First SPAC-Related Securities Suit Filing of 2023

Through reforms enacted in the PSLRA, Congress intended for lead plaintiffs and courts to exercise some control over the plaintiffs’ law firms that pursue securities class action lawsuits. The securities laws also require courts to determine the amount of plaintiffs’ counsel’s fee awards. Yet, as the authors of recent academic paper suggest, the lead plaintiffs and the courts often lack the tools they need to execute these functions.

To try to derive the kinds of information that would allow lead plaintiffs and courts to fulfill their intended roles, the authors reviewed case records of thousands of cases, as a way to identify important indica of law firm performance as well as to extract detailed information about the fee awards. With the benefit of this information, the authors — Professor Stephen Choi of the New York University Law School, Professor Jessica Erickson of the University of Richmond Law School, and Professor Adam Pritchard of the University of Michigan Law School – suggest a variety of ways that lead plaintiffs and courts can better serve their intended functions under the PSLRA. The authors’ February 2023 paper, entitled “The Business of Securities Class Action Lawyering,” can be found here.

Continue Reading The Plaintiffs’ Law Firms’ Securities Litigation Business

In yet another Delaware court D&O insurance coverage decision that is sure to set the D&O insurance industry spinning, a Delaware Superior Court Judge has held that a SPAC’s post-merger runoff policy provides coverage for the defense fees of former directors of the pre-Merger target company for alleged Wrongful Acts that the occurred prior to the merger – even though the former directors were not directors or officers of the SPAC at the time they allegedly committed the alleged Wrongful Acts. The court’s ruling could even further complicate the already fraught process of placing and structuring D&O insurance in the De-SPAC context. A copy of the Court’s February 6, 2023 opinion can be found here. (Please note that I have linked to the copy of the opinion on the Court’s website; the website copy to which I linked says that the opinion was filed under seal, but the seal reportedly was lifted by the court on February 16, 2023.)

Continue Reading Delaware Court: Pre-Merger Target Company Execs Are Insured Persons Under SPAC’S Post-Merger Tail Policy

In a development with interesting implications, the video gaming company Activision Blizzard has agreed to pay $35 million to settle an SEC enforcement action based on allegations that the company lacked controls and procedures to ensure that disclosures about the company’s workforce were adequate. The SEC’s allegations also pertained to alleged whistleblower violations at the company. The enforcement action, underscores the agency’s willingness to use its authority, as one law firm memo put it, to transform workplace misconduct allegations into securities law violations. The SEC’s February 3, 2023, Press Release about the settlement can be found here. The SEC’s Order relating to the allegations can be found here.

Continue Reading SEC’s Brings an “S”-Related ESG Enforcement Action Based on Alleged Human Capital Control Violations

The D&O Diary was on assignment this week at the PLUS D&O Symposium. As reflected the accompanying picture of Times Square, the weather in New York was uncharacteristically sunny and warm for this time of year. The Symposium itself was also superlative; the event was surprisingly well-attended and the sessions were great. My congratulations to the event co-chairs, and to the PLUS staff and volunteer leadership for another successful event.

Continue Reading PLUS D&O Symposium in New York