As I have previously noted on this blog, one recurring source of securities class action litigation exposure for publicly traded companies is the companies’ underlying environmental liabilities. In the latest example of this type of litigation, a plaintiff shareholder has now filed a securities suit against The Chemours Company, a chemical company that spun out of E.I. du Pont de Nemours and Company (“DuPont”) in July 2015. One of the extraordinary things about the new securities suit is that it draws heavily on allegations Chemours itself raised in a 2019 Delaware Chancery Court lawsuit it filed against DuPont, in which, among other things, Chemours alleges that when DuPont spun out the company, its environmental liabilities reserves were “spectacularly” inadequate. A copy of the on October 8, 2019 securities class action complaint filed in the District of Delaware against Chemours, its CEO, and its CFO can be found here.
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Though a Private Company, Uber Hit With Securities Class Action Lawsuit
The news late last week that London’s transport authority had stripped ride-hailing firm Uber of its ride-hire license on the grounds that it was “unfit to operate” in the U.K. capital was merely the latest blow to the company, following a string of scandals, probes, and damaging revelations. Now the company – which, despite its enormous size, is still a privately held firm — has been hit with a federal court securities class action lawsuit, the most recent instance where one of the high-flying “unicorn” companies has been hit with a securities fraud lawsuit after a decline in fortune. The new lawsuit has a number of interesting features, discussed below.
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Is a Remote Annual Meeting Venue an Indicator of Corporate Risk?
Those interested in trying to identify possible corporate risk indicators will want to take a look at a March 18, 2014 paper by Temple University finance professor Yuanzhi Li and New York University finance professor David Yermack entitled “Evasive Shareholder Meetings” (here). According to the authors’ research, there is a strong negative correlation
Securities Litigation Loss Prevention: Managing Earnings Guidance
In my former days on the carrier side, our D&O insurance group advocated for our policyholders a program of securities litigation loss prevention, on the theory that there are steps companies can take to make themselves less likely to be a securities suit target or better able to defend themselves if they are hit with