Securities Litigation

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Most informed observers know that IPO companies are more susceptible to securities class action litigation than are more seasoned companies. IPO companies usually have short operating histories and so their post-offering performance can be unpredictable and may include unexpected developments. When IPO companies stumble out of the blocks, they can attract a securities suit just a short time after their debut. An example of this occurred earlier this year when Snap, Inc. was hit with a securities suit two months after its IPO. A more recent example of this sequence involved Blue Apron Holdings, which this past week was hit with a securities suit just seven weeks after its IPO. These cases underscore the securities litigation vulnerability of IPO companies, which in turn has important implications.
Continue Reading When IPO Companies Stumble Out of the Blocks

paul-weiss-large-300x53President Trump’s nomination of Tenth Circuit Justice Neil Gorsuch to fill the Supreme Court seat vacated by the late Justice Antonin Scalia has attracted a great deal of commentary and raised a host of questions about the proposed new Justice’s views on a variety of different subjects. In the following guest post, attorneys from the Paul Weiss law firm take a look at the proposed Justice’s past writings and opinions on securities litigation and agency deference questions. I would like to thank the Paul Weiss attorneys for allowing me to publish their guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is the Paul Weiss attorneys’ guest post.
Continue Reading Guest Post: Supreme Court Nominee’s Skeptical View of Securities Litigation, Agency Deference

scales of justiceAmong the important parts of any securities class action lawsuit settlement agreement are the so-called “blow provisions,” which provide settling defendants with an option to terminate the settlement agreement if a specified threshold of investors elect to opt out of the settlement. Among other key consideration with respect to blow provisions is that the threshold specified must be carefully structured to allow defendants to terminate or renegotiate the class settlement when opt-outs reach an unacceptable level. In a December 8, 2016 research paper entitled “Considerations for Blow Provisions in Securities Class Action Settlements” (here), Cornerstone Research takes a look at the various ways that blow provisions can be structured, and identifies the pitfalls with the various alternatives.
Continue Reading Setting the “Blow Provisions” in Securities Class Action Settlement Agreements

tenWhile the world of directors’ and officers’ liability is always dynamic, the D&O liability arena was particularly eventful during 2016, with significant implications for what may lie ahead in 2017 – and possibly for years to come.  With full awareness that a complete inventory of key 2016 events could actually be much longer, here is a list of the Top Ten D&O stories of 2016.
Continue Reading The Top Ten D&O Stories of 2016

halliburtonAccording to the company’s December 23, 2016 press release (here), Halliburton has reached an agreement to settle the long-running securities class action pending against the company and certain of its directors and officers for $100 million. During its 14-year existence, the storied case had made two trips to the U.S. Supreme Court and three trips to the Fifth Circuit. The settlement is subject to court approval. Nate Raymond’s December 23, 2016 Reuters article about the settlement can be found here.
Continue Reading Long-Running Halliburton Securities Suit Settles for $100 Million

In a recent post, I noted that plaintiffs’ lawyers had recently launched a series of securities class action lawsuits against several poultry producers in the wake of news that companies in that industry were the target of antitrust enforcement action. Now news has emerged that antitrust regulators may be targeting companies in a different sector, the generic drug manufacturing industry. Within days of the news, plaintiffs’ lawyers have filed several securities class action lawsuits against several generic drug companies — the latest companies to be hit with follow-on securities suits following news of antitrust enforcement actions.
Continue Reading Generic Drug Companies Hit With Antitrust Enforcement Follow-On Securities Suits

japanAs I have previously noted, the prevalence of misrepresentation-related securities litigation in Japan increased significantly after the 2004 revisions to the Japanese securities laws. The increase largely has been due to the legislative changes and to a number of high-profile accounting and financial scandals. There are features of the Japanese law that, according to a recent review, make Japan “an attractive forum for securities litigation.” However, claimants still face a number of hurdles, as a result of which, according to a recent academic study, securities litigation in Japan “is still not a widespread phenomenon.” The June 15, 2016 Law 360 article entitled “A Look at Shareholder Remedies in Japan,” can be found here. University of Tokyo Professor Gen Goto’s January 2016 article “Growing Securities Litigation Against Issuers in Japan: Its Background and Reality” can be found here.
Continue Reading Securities Litigation in Japan

paul weiss largeAmong the decisions that the Supreme Court issued this past Monday was its unanimous ruling in Merrill Lynch, Pierce, Fenner & Smith Inc. v. Manning (here), in which the Court held that the ’34 Act’s  exclusive federal jurisdiction provisions do not preclude a claimant from pursuing state law securities claims in state court.  In the following guest post, attorneys from the Paul Weiss law firm take a look at the Court’s decision in the case and discuss its implications. I would like to thank the Paul Weiss attorneys for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the Paul Weiss attorneys’ guest post.
Continue Reading Guest Post: Supreme Court Rejects Federal Jurisdiction over State Law Claims that Do Not Necessarily Raise Exchange Act Issues

As part of our beat here at The D&O Diaryfilings2016, we regularly monitor new lawsuit filings and try to identify trends and patterns. Over the years, we have noted and commented on this blog about many of the trends and patterns we have identified. More than once we have noted the incidence of director and officer liability litigation arising out of environmental issues. We have also noted that D&O litigation often follows after the announcement of FCPA investigations. As discussed below, there has been a flurry of recent filings involving environmental issues. I have also noted below an interesting variant on the FCPA follow-on civil lawsuit pattern.
Continue Reading Field Notes on Recent Corporate Suit Filing Trends

HBIIThis past year was an eventful one in the corporate and securities litigation arena, with the U.S. Supreme Court’s decision in the Omnicare case, important rulings in the lower courts applying the Supreme Court’s Halliburton II decision, and a host of other important decision on critical securities law issues. In the following memorandum from the Haynes and Boone law firm, attorneys from the firm’s Securities and Shareholder Litigation group take a look at the important securities litigation developments during 2015. I would like to thank the firm and the group for their willingness to publish their memorandum on this site. I welcome guest post submissions from responsible authors on topics of interest to readers of this site. Please contact me directly if you are interested in submitting a guest post. Here is the Haynes and Boone firm’s memorandum.

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Each year our Year in Review comments on significant securities-related decisions by the Supreme Court, federal appellate courts and district courts, notes key developments in SEC enforcement, and summarizes significant rulings in state law fiduciary litigation against directors and officers of public companies.
Continue Reading Guest Post: Year in Review: Securities Litigation