private right of action

In a terse, unsigned one-sentence April 23, 2019 per curiam opinion, the U.S. States Supreme Court has just one week after oral argument dismissed the grant of certiorari in the case of Emulex Corporation v. Verjabedian as “improvidently granted.” The Court had granted cert in the case in order to address a circuit split on the question of whether or not a claimant in must plead scienter in order to establish a tender offer misrepresentation claim under Section 14(e) of the Securities Exchange Act of 1934, or whether allegations of negligence are sufficient. In the merits briefing and at oral argument, the question arose whether or not there is even a private right of action under Section 14(e) at all. As discussed below, the Court’s dismissal leaves all of these questions unaddressed.  The April 23, 2019 opinion in the case can be found here.
Continue Reading Supreme Court Punts on Tender Offer Pleading Standard Case

Uzbekistan (highlighted)

There is no private right of action under the Foreign Corrupt Practices Act (FCPA), but plaintiff shareholders nevertheless frequently file follow-on civil actions in the wake of FCPA allegations against a company. Are these follow-on civil actions just an end run around the FCPA’s lack of a private right of action? That is the question a district court addressed in ruling on a motion to dismiss in a securities class action lawsuit filed against VEON (formerly known as Vimpelcom). In a September 19, 2017 order (here), Southern District of New York Judge Andrew L. Carter, Jr. held that the alleged misrepresentations on which the plaintiff sought to rely were “sufficiently distinct to avoid any potential concern that Plaintiffs are seeking to enforce the FCPA by [their] securities fraud action.” A November 8, 2017 memo from the Shearman & Sterling law firm about the ruling can be found here.
Continue Reading Is a Follow-On Lawsuit an End-Run Around the Absence of an FCPA Private Right of Action?