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Mealey's Securities

  • January 24, 2020

    High Court Asked To Resolve Circuit Split Regarding Extent Of FINRA’s Immunity

    WASHINGTON, D.C. — U.S. Supreme Court review of a Ninth Circuit U.S. Court of Appeals panel’s ruling upholding the dismissal of claims brought by two business owners and several businesses they owned stemming from the Financial Industry Regulatory Authority’s (FINRA) seizure of materials and information during a raid of one of the businesses is warranted because there is a split among the circuits as to whether FINRA is entitled to absolute immunity for its investigatory conduct, the business owners and their related businesses argue in a Nov. 12 petition for writ of certiorari (John Hurry, et al. v. Financial Industry Regulatory Authority Inc., et al., No. 19-643, U.S. Sup.).

  • January 23, 2020

    Fund Moves To Appoint Lead Plaintiff In Fracking Securities Fraud Class Action

    PHILADELPHIA — The Allegheny County Employees’ Retirement System (AERS) on Jan. 21 moved in a Pennsylvania federal court for the Public Employees Retirement Association of New Mexico to be appointed as lead plaintiff in a class action against a hydraulic fracturing pipeline company, the executives of which the plaintiffs say committed securities fraud and coerced a Pennsylvania agency to get approval for the Mariner East 2 pipeline (Allegheny County Employees’ Retirement System v. Energy Transfer LP, et al., No. 20-200, E.D. Pa.).

  • January 22, 2020

    DOJ Updates Judge In SEC’s Case Over Schemes To Defraud Insurers, Reinsurance Trusts

    NEW YORK — The U.S. Department of Justice wrote to a New York federal judge on Jan. 17 updating him on the status of pending criminal proceedings that served as the reasons for a stay of the Securities and Exchange Commission’s lawsuit alleging that two individuals “perpetrated multiple schemes to defraud their advisory clients, which were insurance companies and reinsurance trusts” (United States v. Alexander C. Burns, et al., No. 18-9477, S.D. N.Y.).

  • January 21, 2020

    SEC U.S. Supreme Court Brief: Disgorgement Of Funds Is Valid Under Exchange Act

    WASHINGTON, D.C. — In a brief filed Jan. 15, the U.S. Securities and Exchange Commission argues to the U.S. Supreme Court that Section 21(d)(5) of the Exchange Act authorizes the disgorgement of funds in SEC enforcement actions as a form of “equitable relief” (Charles C. Liu, et al. v. Securities and Exchange Commission, No. 18-1501, U.S. Sup.).

  • January 14, 2020

    U.S. Supreme Court Vacates 2nd Circuit Ruling In ESOP Inside Knowledge Case

    WASHINGTON, D.C. — The U.S. Supreme Court in a per curiam opinion issued Jan. 14 vacated the Second Circuit U.S. Court of Appeals’ judgment in an Employee Retirement Income Security Act appeal concerning an employee stock option plan (ESOP) and remanded for the Second Circuit to determine the merits of claims concerning ERISA-based duty when it comes to inside information (Retirement Plans Committee of IBM, et al. v. Larry W. Jander, et al., No. 18-1165, U.S. Sup.).

  • January 13, 2020

    Retirement Funds Say Fracking Company Committed Fraud, Amend Class Action

    PITTSBURGH — Several retirement funds on Dec. 6 filed an amended federal securities class action in Pennsylvania federal court against a hydraulic fracturing company and some of its executives, contending that they violated the Securities Exchange Act (SEA) and Securities Exchange Commission regulations by committing securities fraud and engaging in insider trading (In re EQT Corporation Securities Litigation, No. 19-754, W.D. Pa.).

  • January 10, 2020

    Calder Factors Weigh In Favor Of Jurisdiction In Securities Suit, Panel Rules

    ST. LOUIS — A federal district court erred in dismissing a securities fraud lawsuit stemming from a failed business relationship for lack of personal jurisdiction because two of the Calder v. Jones factors support a finding a personal jurisdiction, while the other three are “more neutral,” an Eighth Circuit U.S. Court of Appeals panel ruled Jan. 7 (Justin Whaley, et al. v. Jimmy Esebag, et al., No. 18-3236, 8th Cir., 2020 U.S. App. LEXIS 255).

  • January 10, 2020

    Investor Claims Against Barclays Insufficient To Withstand Dismissal Motion

    WILMINGTON, Del. — Investors have failed to sufficiently plead falsity, scienter and the existence of a fiduciary duty in alleging that Barclays Bank PLC misrepresented its relationship with an independent investment solutions firm in violation of federal securities law and common law, which caused the investors to lose their $2.5 million investment in the firm, a federal judge in Delaware ruled Jan. 9 (Keystone Associates LLC, et al. v. Barclays Bank PLC, No. 19-796, D. Del., 2020 U.S. Dist. LEXIS 3475).

  • January 10, 2020

    Government:  Securities Fraud Convictions Against Executives Should Be Reinstated

    NEW YORK — The U.S. government argues in a Jan. 7 opening brief that the Second Circuit U.S. Court of Appeals should reinstate securities fraud convictions against two former executives of a hedge fund with regard to their alleged role in the hedge fund’s scheme to transfer assets to a reinsurance company and related entities to defraud bondholders in an oil and gas company (United States of America v. Uri Landesman, et al., No. 19-3207 c/w 19-3209, 2nd Cir.).

  • January 10, 2020

    4th Circuit Review Sought Of Dismissal Rulings In Under Armour Stock-Drop Suit

    RICHMOND, Va. — Parties in a securities class action lawsuit alleging that Under Armour Inc. and its CEO concealed the company’s decline in demand for its apparel in violation of federal securities laws recently asked a Fourth Circuit U.S. Court of Appeals panel to determine whether a federal district court erred in dismissing shareholder claims as time-barred and for failure to properly plead falsity and scienter (In re:  Under Armour Securities Litigation, No. 19-2032, 4th Cir.).

  • January 10, 2020

    Investment Adviser’s Conviction Supported By Evidence, Panel Rules

    PHILADELPHIA — Government prosecutors provided sufficient evidence to support a jury’s finding that a defendant was an investment adviser when it convicted him of three counts for his role in an investment fraud scheme, a Third Circuit U.S. Court of Appeals panel ruled Dec. 12 (United States of America v. Louis F. Petrossi, No. 18-3454, 3rd Cir, 2019 U.S. App. LEXIS 36975).

  • January 09, 2020

    Judge Won’t Compel SEC’s Access To App Maker’s Bank Records In Digital Asset Row

    NEW YORK — An emergency motion by the Securities and Exchange Commission to compel unredacted bank records from a firm accused of securities registration violations was denied Jan. 6 by a New York federal judge, who indicated, however, that review of the records will ultimately occur (Securities and Exchange Commission v. Telegram Group Inc., et al., No. 1:19-cv-09439, S.D. N.Y., 2020 U.S. Dist. LEXIS 3111).

  • January 09, 2020

    E-Cigarette Maker Hit With Minority Shareholder Suit Over Management Decisions

    SAN FRANCISCO — An investor in e-cigarette maker JUUL Labs Inc. filed a shareholder derivative and minority shareholder class action lawsuit in California state court on Jan. 6, alleging that certain of the company’s current and former executive officers and directors have breached their fiduciary duty and were unjustly enriched at the expense of minority shareholders through their management of the company (Daniel Grove v. Adam Bowen, et al., No. CGC-20-582059, Calif. Super., San Francisco Co.).

  • January 09, 2020

    Securities Claims Against Chinese E-Commerce Company Dismissed

    LOS ANGELES — A federal judge in California on Dec. 20 ruled that the lead plaintiff in a securities class action lawsuit against a Chinese e-commerce company and certain of its senior executives failed to sufficiently plead that the defendants issued any material misrepresentations or omissions in violation of federal securities laws concealing that the company was operating an illegal pyramid scheme (Daniel Kaufman v. Natural Health Trends Corp., et al., No. 19-163, C.D. Calif., 2019 U.S. Dist. LEXIS 222672).

  • January 09, 2020

    District Court’s Loss Causation Analysis Flawed Under Tellabs, Investor Argues

    ATLANTA — A federal district court erred in dismissing a shareholder class action against a beverage maker and certain of its senior executives because it failed to follow a U.S. Supreme Court mandate that it accept the shareholder’s facts alleged as true at the motion to dismiss stage of the litigation and draw all inferences in favor of the shareholder as plaintiff, the shareholder argues in a Dec. 9 appellant brief filed in the 11th Circuit U.S. Court of Appeals (Thomas W. Luczak v. National Beverage Corp., et al., No. 19-14081, 11th Cir.).

  • January 09, 2020

    Preliminary Approval Of $192.5M Securities Class Action Settlement Sought

    COLUMBIA, S.C. — Lead plaintiffs in a securities class action against a gas and electric utility company and certain of its current and former executive officers and directors asked a federal judge in South Carolina on Jan. 7 to grant preliminary approval of a $192.5 million settlement stemming from the defendants’ alleged misrepresentations pertaining to a nuclear reactor construction project at the V.C. Summer nuclear generating station in South Carolina (In re SCANA Corp. Securities Litigation, No. 17-2616, D. S.C.).

  • January 09, 2020

    Appellate Review Of Court’s BSA Findings In SEC Enforcement Action Sought

    NEW YORK — A federal district court erred in ruling, inter alia, that the Securities and Exchange Commission possessed the necessary authority to enforce the suspicious activity reporting (SAR) requirements of the Bank Security Act (BSA) against a clearing firm for its alleged mishandling of its BSA compliance program in violation of federal securities law, the clearing firm argues in a Jan. 6 appellant brief filed in the Second Circuit U.S. Court of Appeals (United States Securities and Exchange Commission v. Alpine Securities Corp., No. 19-3272, 2nd Cir.).

  • January 07, 2020

    Energy Company Agrees To $350M Settlement In Investor Class Action

    PHOENIX — Energy company First Solar Inc. will pay $350 million to settle securities class action claims that it and several of its current and former executive officers concealed manufacturing defects with the company’s solar panel products from investors, causing First Solar’s stock to trade at an artificially high rate, the company announced in a Jan. 6 press release (Mark Smilovits v. First Solar Inc., et al., No. 12-555, D. Ariz.).

  • January 07, 2020

    Denial Of Motion To Vacate Judgment In Failed Golf Course Finance Deal Affirmed

    ATLANTA — In an unpublished per curiam opinion, an 11th Circuit U.S. Court of Appeals panel on Jan. 3 ruled that a federal district court did not err in denying a defendant’s motions to vacate a judgment against him stemming from a failed golf course and resort development financing project in the Bahamas because he failed to comply with statutory requirements that he “diligently pursue his rights” (A&F Bahamas LLC v. World Venture Group Inc., et al., No. 19-12103, 11th Cir., 2020 U.S. App. LEXIS 47).

  • January 07, 2020

    Massachusetts Says Consumer Protection Suit Against Exxon Should Be Remanded

    BOSTON — Massachusetts’ lawsuit against Exxon Mobil Corp. over the company’s marketing of its Synergy gasoline and “green” motor oil should be remanded because the action does not raise federal issues, the state says in a Dec. 26 motion to remand (Massachusetts v. Exxon Mobil Corp., No. 19-12430, D. Mass.).