Securities Litigation

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Just as the COVID-19 virus continues to represent a threat to human populations, companies continue to explore possible alternatives for the treatment of the disease and its symptoms. As in any initiative built around developing and testing unproven products or processes, a number of these efforts to develop coronavirus treatments and therapies are unsuccessful. In some instances, litigation ensues after these unsuccessful efforts. A lawsuit filed last week against a biopharmaceutical company exemplifies the way this sequence of events can lead to litigation, in turn sustaining the ongoing phenomenon of coronavirus-related securities litigation filings that began at the time of the initial COVID-19 outbreak in the U.S. in March 2020.
Continue Reading Biopharma Company Latest to Get Hit With COVID-19-Related Securities Suit

The changes and disruptions caused by the COVID-19 pandemic continue to roil companies’ business operations and financial results. The pandemic’s effects, and the ensuing shifts in business operations and strategic decision-making, are also in some instances continuing to result in securities class action litigation. In the latest example of these phenomena, a plaintiff shareholder has filed a securities suit against the mental health care service provider LifeStance Health Group, Inc. and certain of its executives. The complaint alleges that the Registration Statement prepared in connection with the company’s June 2021 IPO did not adequately disclose the impact on the company’s operations and finances from the lifting of the government stay-at-home orders and did not disclose the pandemic’s impact on the company’s physician workforce. A copy of the August 8, 2022 complaint against the company can be found here.
Continue Reading Mental Health Services Company Hit with Post-IPO COVID-Related Securities Suit

In the now more than two-and-a-quarter years since the initial COVID-19 outbreak in the U.S., a significant number of COVID-related securities class action lawsuits have been filed. What is surprising is not that the suits have been filed; rather, it is that even at this late date, the COVID-related suits continue to be filed. As time has gone by, however, it has become increasingly challenging to say with clarity whether a particular lawsuit is or is not “COVID-related.” The securities class action lawsuit filed late last week against online information platform, Yext, illustrates the increasing difficulty of making the COVID-related categorization, as discussed below.
Continue Reading The Growing Challenge of Identifying COVID-Related Securities Suits

Regular readers of this blog know that one of the important emerging D&O liability exposures involves issues arising from privacy concerns. There have, in fact, been a number of important privacy-related D&O claims filed, including lawsuits relating to the EU’s General Data Protection Regulation (GDPR). Among the highest profile of these GDPR-related lawsuits is the securities class action lawsuit filed against U.K. based media rating firm Nielsen Holdings. The Nielsen securities suit survived a dismissal motion. Now, in the latest development, the Nielsen suit recently settled for $73 million. The settlement is subject to court approval. A copy of the parties’ stipulation of settlement can be found here.
Continue Reading Nielsen Holdings Settles GDPR-Related Securities Suit

Since the earliest outbreak of the coronavirus in the U.S. in March 2020, I have been tracking the coronavirus-related D&O litigation. There have been D&O suits filed throughout the intervening period, though the nature of the suits and the kinds of allegations have evolved over time. One recent aspect of the changes has been that, as pandemic-related circumstances have blended into general business conditions, it has become increasingly difficult to say with certainty whether certain new suits are or are not pandemic-related. A case in point is a lawsuit filed earlier this week against software company Everbridge, which experienced a recent stock price decline due to a number of circumstances including some that the company itself declared to be pandemic-related. I discuss below my reasons for including this new lawsuit in my tally of coronavirus-related lawsuits. A copy of the complaint filed on April 4, 2022 Central District of California can be found here.
Continue Reading New Securities Suit Against Software Company is in Significant Part COVID-Related

As readers of this blog well know, since the initial U.S. coronavirus outbreak in March 2020, plaintiffs’ lawyers have filed dozens of COVID-19-related securities class action lawsuits. Even though the coronavirus-related litigation phenomenon, like the coronavirus outbreak itself, is about to enter its third year, relatively few of the coronavirus-related securities suits have yet reached the motion to dismiss stage. However, last week the federal judge presiding over the coronavirus-related lawsuit filed against Zoom Video Telecommunications entered an order granting in part and denying in part the defendants’ motion to dismiss. The Court’s February 16, 2022 order, a copy of which can be found here, also presents an interesting perspective on the ways in which privacy and security issues can lead to potential securities law liability exposures.
Continue Reading Zoom Coronavirus-Related Securities Suit Dismissal Motion Denied in Part

As I have noted on this site, even though it has now been nearly 22 months since the initial coronavirus outbreak in the U.S., coronavirus D&O lawsuits have continued to be filed continuously since the initial outbreak. Coronavirus-related securities suits were in fact a significant securities litigation phenomenon in 2021 as well as in 2020. In an early sign that the coronavirus related litigation could remain a significant securities litigation factor in 2022, late last week plaintiffs’ lawyers filed two new securities lawsuits against a health insurance and services company and against a diagnostic testing company. Both companies had completed IPOs earlier in 2021. A copy of the new securities lawsuit against Bright Health Group can be found here and a copy of the new securities suit against Talis Biomedical Corporation can be found here.
Continue Reading First Coronavirus-Related Securities Suits of 2022 Filed

The directors’ and officers’ liability environment is always changing, but 2021 was a particularly eventful year, with important consequences for the D&O insurance marketplace. The past year’s many developments also have significant implications for what may lie ahead in 2022 – and possibly for years to come.  I have set out below the Top Ten D&O Stories of 2021, with a focus on the future implications. Please note that on Thursday, January 13, 2022 at 11:00 AM EST, my colleague Marissa Streckfus and I will be conducting a free, hour-long webinar in which we will discuss The Top Ten D&O Stories of 2021. Registration for the webinar can be found here. I hope you will please join us for the webinar.
Continue Reading The Top Ten D&O Stories of 2021

In an opinion written in unusually direct language, a federal district court has denied the motion to dismiss in a coronavirus-related securities class action lawsuit filed against a vaccine development company. However, the motion to dismiss was granted with leave to amend as to the vaccine company’s major outside shareholder. The significant context of the pandemic itself and the swirl of media coverage surrounding it proved to be a significant factor in the court’s denial of the motion to dismiss as to the company defendants. The court’s December 22, 2021 opinion in the Vaxart securities litigation can be found here.
Continue Reading Coronavirus-Related Securities Suit Against Vaccine Company Survives Dismissal Motion

As I have noted in prior posts (most recently here), since the outbreak of the coronavirus in the U.S. last March plaintiff shareholders have filed numerous COVID-19-related securities class action lawsuits. Relatively few of these cases have reached the motion to dismiss stage, but the few dismissal motion results so far are decidedly mixed, at best, from the plaintiffs’ perspective. In the latest of these cases to fail to survive the initial pleading hurdle, the court in the COVID-19-related securities suit against biopharma firm Sorrento Therapeutics has granted the defendants’ motion to dismiss, albeit with leave to amend. The court’s November 18, 2021 order can be found here.
Continue Reading COVID-19-Related Securities Suit Against Biophama Company Dismissed