WASHINGTON, D.C. — Audio products and electronic systems manufacturer Harman International Industries Inc. will pay more than $28 million to settle claims that it and certain of its current and former executive officers concealed issues with the company’s line of personal navigation devices (PND) in violation of federal securities laws, according to a motion for preliminary approval of settlement filed April 19 in the District of Columbia federal court (In re Harman International Industries Inc. Securities Litigation, No. 07-1757, D. D.C.).
WASHINGTON, D.C. — The U.S. Supreme Court on April 18 heard oral arguments in an appeal of a 10th Circuit U.S. Court of Appeals ruling that determined that disgorgement is not a penalty or forfeiture pursuant to 28 U.S. Code Section 2462, U.S.C. § 2462, and thus, is not subject to a five-year statute of limitations (Charles R. Kokesh v. Securities and Exchange Commission, No. 16-529, U.S. Sup.).
WASHINGTON, D.C. — The U.S. Supreme Court on April 17 heard oral arguments in an appeal of a Second Circuit U.S. Court of Appeals ruling affirming that shareholders that filed a securities class action lawsuit after opting out of settlement class against the same defendants were barred from doing so as their claims were outside the statute of repose (California Public Employees’ Retirement System v. Moody Investors Service Inc., et al., No. 16-373, U.S. Sup.).
WEST PALM BEACH, Fla. — An expert is qualified to testify regarding a rule under Financial Regulatory Authority Inc. (FINRA), a Florida federal judge ruled April 14, denying a motion to exclude filed by a securities broker-dealer (UBS Financial Services Inc. v. Bounty Gain Enterprises Inc., No. 14-81603, S.D. Fla., 2017 U.S. Dist. LEXIS 57502).
Shareholder class action lawsuits over proposed merger deals, and misrepresentations class actions filed by investors of a transportation company, an investment firm and a mining company are highlights of recent securities complaint filings.
SAN DIEGO — Shareholders in a securities class action lawsuit against a for-profit higher education provider and certain of its current and former executive officers have failed to plead scienter in making their federal securities law claims, a federal judge in California ruled April 5 in dismissing a second amended complaint (Nelda Zamir v. Bridgepoint Education Inc., et al., No. 15-408, S.D. Calif., 2017 U.S. Dist. LEXIS 52573).
SAN DIEGO — A federal judge in California on March 22 granted class certification in a securities class action lawsuit and appointed shareholders as class representatives and two law firms as class counsel, rejecting arguments by defendants that the shareholders and their counsel would not be able to adequately represent the class (Brad Mauss v. NuVasive Inc., et al., No. 13-2005, S.D. Calif., 2017 U.S. Dist. LEXIS 41894).
BOSTON — Lead plaintiffs in a securities class action lawsuit against a pharmaceutical company and its CEO failed to plead allegations giving rise to a strong inference of scienter in making their federal securities law claims, a First Circuit U.S. Court of Appeals panel ruled April 7 in affirming a lower court’s dismissal ruling (Terry Brennan, et al. v. Zafgen Inc., et al., No. 16-2057, 1st Cir., 2017 U.S. App. LEXIS 6052).
BOSTON — A pharmaceutical company and its board of directors issued a proxy statement in connection with a proposed merger deal that contained several misrepresentations and omitted important facts surrounding the proposed transaction in violation of federal securities laws, an investor argues in an April 11 securities class action complaint filed in Massachusetts federal court (Stephen Bushansky v. Tokai Pharmaceuticals Inc., et al., No. 17-10621, D. Mass.).
ATLANTA — The Securities and Exchange Commission has sought an excessive amount of civil penalty, and a federal judge should require a defendant in an insider-trading lawsuit to pay only a portion of that amount, the defendant argues in an April 7 opposition brief filed in Georgia federal court (Securities and Exchange Commission v. Thomas D. Melvin Jr., et al., No. 12-2984, N.D. Ga.).
NEW YORK — Trustees cannot be held liable for not pursuing enforcement actions against a party that is deemed to be bankrupt at the time the trustee discovers facts giving rise to a claim, a trustee argues in an April 7 motion for summary judgment filed in a shareholder derivative and securities class action lawsuit filed in New York federal court (Fixed Income Shares: Series M, et al. v. Citibank N.A., et al., No. 14-9373, S.D. N.Y.).
HOUSTON — A federal judge in Texas on April 10 granted preliminary approval of a $10.5 million settlement between investors and one of the country’s largest industrial, engineering and construction companies in a securities class action lawsuit alleging that the company and certain of its current and former senior officers misrepresented the company’s business and financial condition in violation of federal securities laws (In re KBR Inc. Securities Litigation, No. 14-1287, S.D. Texas).
CENTRAL ISLIP, N.Y. — Ruling that a defendant has failed to provide any new evidence to support his continued motions for reconsideration in a securities fraud lawsuit, a federal judge on April 6 denied the defendant’s motion for reconsideration of a previous order denying his request for a stay of judgment, cautioning the defendant that continued motions to reconsider using the same arguments that have already been denied is an “abuse of the judicial process” (Securities and Exchange Commission v. iShopNoMarkup.com, et al., No. 04-4057, E.D. N.Y.; 2017 U.S. Dist. LEXIS 53116).
SOUTH BEND, Ind. — A group of shareholders have met all statutory requirements to serve as lead plaintiffs in a securities class action lawsuit against a medical equipment developer and certain of its executive officers, a federal judge in New Jersey ruled April 3 in granting their motion for appointment as lead plaintiffs (Rajesh M. Shah v. Zimmer Biomet Holdings Inc., et al., No. 16-0815, N.D. Ind., 2017 U.S. LEXIS 50236).
WASHINGTON, D.C. — Securities and Exchange Commission administrative law judges (ALJs) are not officers who need to be appointed pursuant to the appointments clause of the U.S. Constitution, the SEC says in a March 31 opposition brief filed in the District of Columbia Circuit U.S. Court of Appeals (Raymond J. Lucia Companies Inc., et al. v. Securities and Exchange Commission, No. 15-1345, D.C. Cir.).
NEWARK, N.J. — Dismissal of claims against a pharmaceutical company’s director in a securities class action lawsuit is proper because lead plaintiffs failed to serve the director within the statutorily required 120-time period and failed to show that an extension of that time period is warranted, a federal judge in New Jersey ruled March 31 in granting the director’s motion to dismiss (Robin J. Dartell, et al. v. Tibet Pharmaceuticals Inc., et al., No. 14-3620, D. N.J., 2017 U.S. Dist. LEXIS 48915).
DALLAS — A Texas federal judge on March 31 granted preliminary approval of a $100 million securities class action settlement between investors and Halliburton Co. and its CEO who were alleged to have issued certain misrepresentations regarding the company’s asbestos litigation liability, its financial condition and the benefits of a merger deal in violation of federal securities laws (The Erica P. John Fund Inc. v. Halliburton Co., et al., No. 02-1152, N.D. Texas).
NASHVILLE, Tenn. — Restaurant chain Ruby Tuesday Inc. will pay $5 million to settle claims that it and certain of its executive officers and directors mispresented the company’s brand repositioning and concealed the poor performance of one of its chains of restaurants in violation of federal securities laws, according to a motion for stipulation of settlement filed March 29 in Tennessee federal court (Dennis Krystek v. Ruby Tuesday Inc., et al., No. 14-1119, M.D. Tenn.).
NEW YORK — The lead plaintiff in a securities class action lawsuit against a steel processing company and certain of its current and former executive officers and directors have failed to show that the defendants issued any material misrepresentations regarding the company’s financial condition in violation of federal securities laws, a federal judge in New York ruled March 29 in dismissing the lead plaintiff’s third amended complaint with prejudice (Aram J. Pehlivanian v. China Gerui Advanced Materials Group Ltd., et al., No. 14-9443, S.D. N.Y., 2017 U.S. Dist. LEXIS 46852).
NEW YORK — A federal judge in New York on March 25 partially granted a motion to dismiss filed by defendants in a securities class action lawsuit, ruling that lead plaintiffs failed to show that one of the defendants acted with the requisite scienter in making their federal securities law claims (In re Eletrobras Securities Litigation, No. 15-5754, S.D. N.Y., 2017 U.S. Dist. LEXIS 44350).