In what is the largest case dispositions of its type that I have ever seen, a court in Tokyo has ordered four executives of Tokyo Electric Power Holdings (Tepco) to pay the company 13.321 trillion yen – the equivalent of $97 billion — based on the court’s finding that the individuals had negligently failed to take steps that would have prevented the disaster at the Fukushima Daiichi nuclear plant after the March 2011 earthquake and tsunami. This verdict, which is described in a July 13, 2022 Wall Street Journal article (here), is noteworthy on many levels, as discussed below. Continue Reading Massive $97 Billion Verdict Awarded Against Fukushima Utility Executives

It is so interesting to me that, notwithstanding the passage of time since the initial coronavirus outbreak in the U.S. in March 2020, plaintiff shareholders continue to file COVID-19-related securities class action lawsuits — as we saw, for example, in the infrastructure overcapacity lawsuit filed last week against Amazon. In yet another case showing how COVID-related concerns are continuing to roil companies and attract securities suits, earlier this week a plaintiff shareholder filed a securities class action lawsuit against developmental-stage pharmaceutical company Molecular Partners AG in part owing to setbacks the company encountered in its efforts to develop a COVID-19 treatment candidate. A copy of the July 12, 2022 lawsuit filed against Molecular Partners can be found here. Continue Reading Drug Development Company Hit with COVID-19-Related Securities Suit

As readers of this blog well know, over the last 18 months or so there has been an onslaught of SPAC-related securities class action litigation. Most of these cases have only just been filed and therefore have not yet reached the motion to dismiss stage. However, a number of the earlier filed cases are now reaching that dismissal motion stage, and although the results so far are mixed, some of the cases are surviving the initial pleading hurdles, at least in part.

 

On July 1 ,2022, and in the latest example of a SPAC-related securities suit surviving the dismissal motion at least in part, Northern District of California Judge Susan Illston partially denied the motion to dismiss in the SPAC-related securities suit filed against Velodyne Lidar and certain of the executives of the SPAC into which Velodyne merged. As discussed below, there are several interesting features of Judge Illston’s opinion, a copy of which can be found here. Continue Reading SPAC-Related Securities Suit Partially Survives Dismissal Motion

In recent months, the SEC has released a series of proposed rules relating to several different topics, including most significantly its March 2022 release of proposed rules regarding climate change and greenhouse gas emissions disclosure. These various proposed rules are still in the public comment period and it remains to be seen whether the various proposed rules will be adopted and if so in what form. Even assuming some forms of the proposed rules are adopted, the rules almost certainly will be subject to court challenge by business groups and other constituencies. As a result of the U.S. Supreme Court’s landmark decision in the last days of June in the carbon emissions rulemaking case, groups challenging the SEC’s rules have a potentially potent new tool to use to try to block the rules. Continue Reading Will the “Major Questions Principle” Block the SEC’s Proposed Climate Change Disclosure Rules?

St. James’s Park, London

This past week, The D&O Diary was on assignment in London. London has many attractions, but weather is not usually one of them. However, during the recent early July days while we were visiting, the weather was just great. As a result, we spent almost all of our time there exploring London out-of-doors. Continue Reading July in London

It has been well over two years since the initial coronavirus outbreak in the U.S., but the pandemic continues to affect businesses. Many companies that found themselves making business decisions at the outset of the pandemic are still dealing with the consequences of those decisions. In at least some cases, the consequences from those business decisions are leading to securities class action litigation, as the lawsuit filed this week against Amazon shows. Continue Reading Amazon Hit With Securities Suit Over Pandemic-Related Infrastructure Overcapacity

As readers of this blog know, as a follow-on effect to the massive wave of SPAC activity in the U.S., there has also been a surge of securities class action lawsuits involving companies that engaged in SPAC transactions. Many of these suits have only just been filed, so it is too early to tell how they will fare. But some of the cases are now reaching the motion to dismiss stage. If the recent motion to dismiss ruling in the SPAC-related lawsuit against mobile gaming technology company Skillz is any indication, many of these cases could encounter substantial hurdles as they go forward. Continue Reading Motion to Dismiss Granted in SPAC-Related Securities Suit Against Gaming Company

The number of securities class action lawsuit filings in the first half of 2022 remained at the lower levels that prevailed last year and below the more elevated levels that prevailed during the period 2017-2020. Though the number of securities class action lawsuit filings in the year’s first six months is below the recent higher levels, the number of suits filed is still consistent with long-term averages. The difference in the number of filings so far this year and the elevated numbers during the recent period were both largely due to merger objection lawsuit filings patterns. Continue Reading Pace of Securities Suit Filings in First Half 2022 Slightly Below Last Year’s Annual Level

In a recent post, I noted that while companies may face investor and regulator pressure to address ESG-related issues, ESG-related actions can also entail operational and financial risks — and litigation risks, as well. In the latest example of a company whose ESG-motivated actions went awry, leading to securities litigation, Wells Fargo has been sued in a securities class action lawsuit after media reports that its efforts to diversify its work force led to fake job interviews, allegedly contrary to the company’s disclosures concerning its diversity efforts. A copy of the June 28, 2022 complaint against Wells Fargo can be found here. Continue Reading Another Example of ESG-Related Actions Leading to a Securities Lawsuit

According to a new report about SPACs and SPAC-related securities litigation, even though the market for SPAC IPOs may have cooled in recent months, SPAC-related litigation has “yet to heat up.” Indeed, according to the report, litigation involving the 977 SPACs that completed IPOs during the period January 2019 and April 2022 “may continue to grow over the next few years.” The report, which is entitled “SPAC Federal Securities Litigation Analysis” and was written by David P. Abel, Managing Attorney, U.S. Market Advisors Law Group PLLC, can be found here. Continue Reading Further SPAC-Related Securities Litigation Filings Likely in the Months Ahead?