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Mealey's Securities

  • June 24, 2019

    Supreme Court Declines Review Of Loss Causation Pleading Standard Ruling

    WASHINGTON, D.C. — The U.S. Supreme Court on June 24 denied a petition for writ of certiorari filed by an energy company and several of its current and former senior executives seeking determination of the appropriate pleading standard for alleging loss causation in a securities class action lawsuit (First Solar Inc., et al. v. Mineworkers’ Pension Scheme, et al., No. 18-164, U.S. Sup.).

  • June 24, 2019

    High Court Won’t Review 9th Circuit’s Morrison Application In Securities Suit

    WASHINGTON, D.C. — The U.S. Supreme Court on June 24 declined to review an appeal of a Ninth Circuit U.S. Court of Appeals holding in which it applied the Supreme Court’s ruling in Morrison v. National Australia Bank, Ltd. to find that Toshiba Corp.’s American Depositary Shares (ADSs) were securities under the Securities Exchange Act of 1934 (Toshiba Corp. v. Automotive Industries Pension Trust Fund, et al., No. 18-486, U.S. Sup.).

  • June 21, 2019

    Dismissal Of Stock-Drop Suit Against Cemetery Company, Others Affirmed

    PHILADELPHIA — A federal district court did not err in dismissing a shareholder class action lawsuit against a cemetery services provider and others for failure to plead any materially false and/or misleading statements in an attempt to conceal its poor financial condition in violation of federal securities laws because, for each alleged category of alleged misrepresentations, the information was “readily and consistently disclosed” by the defendants, a Third Circuit U.S. Court of Appeals panel ruled June 20 (Peter Fan, et al. v. StoneMor Partners LP, et al., No. 17-3843, 3rd Cir., 2019 U.S. App. LEXIS 18520).

  • June 20, 2019

    SEC Depriving Defendant Of Constitutional Right To Jury Trial, Amici Argue

    NEW ORLEANS — The Securities and Exchange Commission’s decision to bring an enforcement action against an accountant instead of first filing an action in federal court has deprived the defendant of her constitutional right to a jury trial under the Seventh Amendment to the U.S. Constitution, Dallas Mavericks owner Mark Cuban and two hedge fund managers argue in a June 17 amicus brief filed in the Fifth Circuit U.S. Court of Appeals (Michelle Cochran v. Securities and Exchange Commission, et al., No. 19-10396, 5th Cir.).

  • June 19, 2019

    SEC Had Authority To Adopt Political Campaign Rule, Divided D.C. Circuit Rules

    WASHINGTON, D.C. — In  a divided opinion, a District of Columbia Circuit U.S. Court of Appeals panel on June 18 ruled that although the New York Republican State Committee (NYGOP) has standing to challenge a Securities and Exchange Commission order regulating the political contributions of members of the Financial Industry Regulatory Authority (FINRA), the SEC “acted within its authority” in adopting the rule (New York Republican State Committee, et al. v. Securities and Exchange Commission, No. 18-1111, D.C. Cir., 2019 U.S. App. LEXIS 18187).

  • June 18, 2019

    5th Circuit Vacates, Remands Orders Approving Global Settlement Over Ponzi Scheme

    NEW ORLEANS — The Fifth Circuit U.S. Court of Appeals on June 17 vacated and remanded a lower federal court’s orders that approved a global settlement between the receiver for Stanford International Bank and insurers and barred all actions against the insurers concerning the policies or Stanford entities in a dispute arising from the Stanford financial Ponzi scheme, finding that the lower court lacked authority to approve the settlement (Securities And Exchange Commission v. Stanford International Bank, Limited, et al., No. 17-10663, 5th Cir., 2019 U.S. App. LEXIS 18111).

  • June 17, 2019

    Dismissal Of Stock-Drop Suit Against Health And Human Services Provider Affirmed

    RICHMOND, Va. — A Fourth Circuit U.S. Court of Appeals panel on June 14 affirmed a lower court’s dismissal of a securities class action complaint with prejudice against an international provider of health and human services for government agencies and three of its senior executives (Amalgamated Bank v. Maximus Inc., et al., No. 18-2127, 4th Cir., 2019 U.S. App. LEXIS 17927).

  • June 17, 2019

    Broker Seeks High Court Review Of SEC Action Ruling To Cure Circuit Split

    WASHINGTON, D.C. — The U.S. Supreme Court should review an 11th Circuit U.S. Court of Appeals ruling in an appeal of a Securities and Exchange Commission enforcement action against a broker because the appellate panel’s holding that it lacked “authority” to consider the broker’s evidentiary challenges because he failed to file the necessary post-verdict motion for reconsideration or for a new trial has created a split among the circuits, the broker argues in a May 20 petition for writ of certiorari (Christopher Hall v. U.S. Securities and Exchange Commission, No. 18-1471, U.S. Sup.).

  • June 17, 2019

    Attorney Fee Award In Securities Suit Deemed In Line With 2nd Circuit Standard

    NEW YORK — In a May 23 opinion, a Second Circuit U.S. Court of Appeals panel ruled that a federal district court did not err in overruling an objection to an attorney fee award because although the claims settled in the securities class action lawsuit were initiated under fee-shifting statutes, “the common-fund doctrine properly controls the district court’s allocation of attorneys’ fees from a common settlement fund” (Fresno County Employees’ Retirement Association v. Isaacson/Weaver Family Trust, No. 17-2662, 2nd Cir., 2019 U.S. App. LEXIS 15283).

  • June 17, 2019

    Petitioners: Government’s Amicus Brief In Securities Suit Misses The Mark

    WASHINGTON, D.C. — The U.S. government has “sidestep[ped]” the question presented in an appeal of a Ninth Circuit U.S. Court of Appeals panel’s determination that a general proximate cause test is the proper test for determining loss causation by trying to dispel any ideas of a circuit split described in a petition for writ of certiorari filed by defendants in the action in its brief as amicus curiae, the defendants argue in a May 28 supplemental brief filed in the U.S. Supreme Court (First Solar Inc., et al. v. Mineworkers’ Pension Scheme, et al., No. 18-164, U.S. Sup.).

  • June 17, 2019

    High Court Review Of SEC Disgorgement Award Sought In Light Of Kokesh

    WASHINGTON, D.C. — The U.S. Supreme Court should grant review of a federal appellate court’s ruling in a Securities and Exchange Commission enforcement action holding that the SEC may seek disgorgement in addition to injunctive relief and a civil monetary penalty because the ruling provides the Supreme Court with an opportunity to address the issue, which it failed to do in Kokesh v. SEC, petitioners argue in a May 31 petition for writ of certiorari (Charles C. Liu, et al. v. Securities and Exchange Commission, No. 18-1501, U.S. Sup., 2019 U.S. S. Ct. Briefs LEXIS 1995).

  • June 14, 2019

    Judge Grants Motion To Consolidate Inflated Stock Price Class Actions

    MADISON, Wis. — After holding that a public school teachers’ pension and retirement fund and others met the requirements for the consolidation of two class actions in which the plaintiffs allege that a company artificially inflated the purchase price of stock, a Wisconsin federal judge on June 12 granted their motion to consolidate and for the appointment of counsel (Earl S. Wagner, et al. v. Spectrum Brands Legacy, Inc., et al., Nos. 19-cv-178 and 19-cv-347, W.D. Wis., 2019 U.S. Dist. LEXIS 98251).

  • June 13, 2019

    Judge Stays SEC’s Case Over Schemes To Defraud Insurers, Reinsurance Trusts

    NEW YORK — A New York federal judge on June 10 stayed a lawsuit by the Securities and Exchange Commission that alleges that two individuals “perpetrated multiple schemes to defraud their advisory clients, which were insurance companies and reinsurance trusts” (Securities and Exchange Commission v. Alexander C. Burns, et al., No. 18-09477, S.D. N.Y.).

  • June 11, 2019

    Liquidators File Breach Of Fiduciary Duty Case Over Reinsurance Transactions

    WILMINGTON, Del. — Two limited liability companies and liquidators for one of the companies filed a 101-page complaint in a Delaware state court on June 7, alleging breach of fiduciary duty with regard to transactions involving reinsurance agreements (Principal Growth Strategies LLC, et al. v. AGH Parent LLC, et al., No. 2019-0431, Del. Chan.).

  • June 11, 2019

    Panel Remands Portion Of Securities Fraud Suit To District Court

    NEW ORLEANS — A Fifth Circuit U.S. Court of Appeals panel on June 6 ruled that although a federal district court properly dismissed certain misrepresentation claims made by plaintiffs in a securities fraud lawsuit, other alleged misrepresentations and omissions were properly pleaded, and, therefore, the district court erred in dismissing them (Doctor David Masel, et al. v. Adriana Villarreal, et al., No. 18-40499, 5th Cir., 2019 U.S. App. LEXIS 17288).

  • June 11, 2019

    Cloud Content Management Platform Provider Hit With Shareholder Class Action

    SAN FRANCISCO — A shareholder of a provider of a cloud content management platform sued the company and certain of its officers and directors in California federal court on June 6, alleging that the defendants misrepresented the company’s business and financial condition in violation of federal securities laws (Simo Duvnjak v. Box Inc., et al., No. 9-3173, N.D. Calif.).

  • June 10, 2019

    3rd Circuit Panel Upholds Conviction In Ponzi Scheme Criminal Suit

    PHILADELPHIA — A federal district court did not abuse its discretion in denying a defendant’s motion for a mistrial in a criminal lawsuit stemming from his alleged operation of a Ponzi scheme based on juror misconduct because the district court’s actions taken after the alleged misconduct was discovered “were well within the Court’s discretion, and nothing further was required,” a Third Circuit U.S. Court of Appeals panel ruled June 7 in a nonprecedential opinion (United States v. Bernard M. Parker, No. 17-3442, 3rd Cir., 2019 U.S. App. LEXIS 17201).

  • June 10, 2019

    11th Circuit Panel Upholds Evidentiary Rulings In Ponzi Scheme-Related Suit

    ATLANTA — A federal district court did not abuse its discretion in denying a request by investors to depose a convicted Ponzi scheme operator because the investors delayed seeking to depose the individual until the discovery deadline had expired, an 11th Circuit U.S. Court of Appeals panel ruled June 6 (Catherine Kerruish, et al. v. Essex Holdings Inc., et al., No. 18-14813, 11th Cir., 2019 U.S. App. LEXIS 17060).

  • June 10, 2019

    Investor: Attorney Fee Award In Securities Class Action Settlement Excessive

    SAN FRANCISCO — A federal district court abused its discretion in awarding lead counsel in a securities class action against Wells Fargo & Co. 20 percent of a $480 million settlement for attorney fees because the amount sought was significantly higher than the amount it should have received, a shareholder argues in a June 5 appellant brief filed in the Ninth Circuit U.S. Court of Appeals (Gary Hefler, et al. v. Thomas Pekoc v. Wells Fargo & Co., et al., No. 19-15140, 9th Cir.).

  • June 7, 2019

    2nd Circuit Panel Affirms District Court’s Dismissal Of Xerox Stock Drop Suit

    NEW YORK — Without providing detail, a Second Circuit U.S. Court of Appeals panel on June 6 affirmed a federal district court’s dismissal of a shareholder class action against Xerox Corp. and certain of its current and former executive officers (Arkansas Public Employees Retirement System v. Xerox Corp., et al., No. 18-1165, 2nd Cir.).