In a development that may foreshadow further "gatekeeper" claims as part of the current credit crisis litigation wave, on April 1, 2009, the trustee for the New Century Financial Corp. liquidation initiated lawsuits in California and New York against KPMG and its international parent, seeking to recover $1 billion in damages for negligence and for
UBS Dismissal: The End of Auction Rate Securities Lawsuits?
A federal judge has ruled that securities class action plaintiffs who availed themselves of UBS’s auction rate securities regulatory settlement cannot separately maintain claims for damages against UBS. But while this ruling would seem to represent at least the beginning of the end for many similarly placed plaintiffs, we may still be a long way
Subprime-Related ERISA Suits: Facing Skepticism?
Along with the flood of securities lawsuits, the current credit crisis has also generated a wave of litigation under ERISA, as I have detailed here. And just as many of the credit crisis-related securities cases have failed to survive preliminary judicial scrutiny (as noted recently here), at least some of the ERISA cases
Dismissal Motion Granted in Downey Financial Subprime Securities Suit
On March 18, 2009, Judge John F. Walter of the Southern District of California granted the defendants’ motion to dismiss, with leave to amend, in the subprim-related securities lawsuit involving certain former directors and officers of Downey Financial Corp. A copy of the order can be found here.
Background
Securities class action lawsuits were
Credit Crisis Securities Suits: Potential Hurdles?
The current global financial crisis may result in "unprecedented levels of litigation" that "will either serve to identify ‘weak links’ in the chain of participants who originate, appraise, and service collateral and underwrite, manage, insure, rate and sell securities," or it will serve to "highlight where the market may have underappreciated certain risks or failed
Impac Mortgage Subprime Mortgage Securities Lawsuit Dismissed With Prejudice
On March 9, 2009, in a short but strongly worded opinion, Judge Andrew Guilford of the Central District of California dismissed with prejudice the third amended complaint in the subprime-related securities class action lawsuit filed against Impac Mortgage Holdings. A copy of the opinion can be found here.
Background
As discussed here
Securities Lawsuit Targets Auction Rate Securities Investor
Last year, investors filed numerous lawsuits against the investment banks and broker dealers who sold the investors auction rate securities. However, in a recent lawsuit, the targeted company was not an auction rate securities seller; rather, it was an auction rate securities buyer, which is alleged to have misrepresented to its own shareholders
Financial Crisis: Bulletins from the Front
The current financial crisis involves a potent witches’ brew of bankruptcies, mortgage bailouts, failed banks, blame assignment, and liquidity issues. Because every one of these ingredients contributes in some important way to the total mix of current woe, this post briefly references each one of these issues and concludes with a video that manages to find
Worrying About a “Going Concern”
General Motors’ March 4, 2009 filing on Form 10-K (here), among other things, reflected the doubts of the company’s auditor, Deloitte & Touche, of the company’s ability to continue as a "going concern."
The auditors, quoted in the company’s filing, said that "the corporation’s recurring losses from operations, stockholders’ deficit
A Week’s Worth of News and Notes
Even though I was not even away a full week for the recent PLUS D&O Symposium, there was a flood of noteworthy developments while I was gone. Here is a roundup of last week’s news and notes.
Subprime-Related Derivative Lawsuit Largely Dismissed: In a detailed and painstaking February 24, 2009 opinion (here)