In yet another securities suit following on news of a bribery or corruption investigation, and in the latest securities suit involving a global mining company, on December 12, 2016, a plaintiff shareholder filed a securities class action lawsuit in the Southern District of New York against the world’s second-biggest mining company, U.K.-based Rio Tinto plc, and certain of its current and former officers. The complaint arises out of the company’s recent announcement of a corruption investigation involving its operations in the Simandou iron mine, located in southern Guinea. As discussed below, this latest lawsuit exemplifies a number of the key securities litigation filing trends that have arisen this year.
Continue Reading Bribery-Related Follow-On Securities Suit Filed Against U.K.-Based Rio Tinto
foreign-domiciled companies
Onslaught of Securities Suits Against Brazilian Companies Continues
As a result of scandals, investigations, and even an environmental catastrophe, there has been a wave of securities lawsuit filings in the U.S. against Brazilian-domiciled companies whose securities are listed in the U.S. This filing trend began in late 2014 with the first lawsuit filing against Petrobras and certain of its directors and officers, which was in turn followed by lawsuits against other companies caught up in the corruption scandal. In recent weeks lawsuits related to a separate regulatory investigation in Brazil have emerged, bringing the total number of securities lawsuits pending in the U.S. against Brazilian companies to six. These developments, along with events in Brazil itself, have roiled the D&O insurance marketplace in Brazil, particularly for Brazilian companies with securities listed in the U.S.
Continue Reading Onslaught of Securities Suits Against Brazilian Companies Continues
Securities Litigation Filing Trends: Suits Against Foreign Companies Continue to Accrue
As we ease into the final two weeks of the year, it seems likely that just about all of the securities class action lawsuits that are going to be filed this year have already been filed. Sure, one or two more may slip in yet, so it is not quite time for the final analysis of the year’s filings. But with the year just about done, there are some trends that already seem clear. One is the increased numbers of IPO-related securities lawsuits, which I recently noted here. Another securities class action filing trend is the heightened level of securities suit filing activity involving non-U.S. companies. The number of securities suit filings against non-U.S. companies during the year was both above historical levels and disproportionately greater than the number of foreign companies whose shares are listed on U.S. exchanges.
Continue Reading Securities Litigation Filing Trends: Suits Against Foreign Companies Continue to Accrue
Year-to-Date Securities Suit Filings Disproportionately Involve Non-U.S. Companies
Historically, non-U.S. companies listed on U.S. exchanges were sued in securities class action lawsuits less frequently than were listed U.S. companies. For several years now, according to NERA, non-U.S. firms have represented about 16% of all companies listed on the U.S. exchanges, but according to Cornerstone, for the period 1997-2013, the average percentage…
Tesco Accounting Scandal Draws Securities Class Action Lawsuit
When Tesco PLC announced on September 22, 2014 that its previously forecast first-half profit had been overstated by £250 ($408.8 million), the news of the accounting irregularities was “serious,” as Tesco plc’s CEO of less than a month’s standing at the time put it. The company also announced that the overstatement, first flagged when an …
Foreign Investors Who Bought BP Shares Overseas Can Pursue English Law Claims in U.S. Court
The U.S. Supreme Court’s July 2010 decision in Morrison v. National Australia Bank seemed to sound the death knell for so-called “f-cubed” litigation – that is, lawsuits brought in U.S. courts under the U.S. securities laws by foreign investors who bought their shares in a foreign company on a foreign exchange. However, in an interesting …
Second Circuit Affirms Porsche Securities Suit Dismissal; Domestic Transaction Necessary But Not Sufficient to Invoke U.S. Securities Laws
On August 16, 2014, in a long-awaited decision that is sure to provoke comment and that could fuel disputes in future cases, the Second Circuit affirmed the dismissal of the securities suits hedge fund purchasers of certain swap agreements had filed against Porsche and its executives.
The plaintiffs contended that because they had completed the …
Texas Appellate Court Affirms Transocean Deepwater Horizon Derivative Suit Dismissal: An Interesting Angle on Corporate Inversion Transactions?
In a July 24, 2014 opinion (here), an intermediate Texas appellate court, applying Texas law, affirmed the trial court’s dismissal on forum non conveniens grounds of the Deepwater Horizon disaster-related shareholder derivative suit filed against Switzerland-domiciled Transocean Limited. The court’s ruling is interesting in and of itself, but it may be even more …