Mealey's Securities

  • December 7, 2017

    Defendants In Stock-Drop Suit Seek Dismissal Of Federal Securities Law Claims

    HOUSTON — Defendants in a securities class action lawsuit against a worldwide provider of professional services and technologies within the government services and hydrocarbons industries on Dec. 4 asked a federal judge in Texas to dismiss federal securities law claims because shareholders failed to plead a material misrepresentation, scienter of loss causation (In re KBR Inc. Securities Litigation, No. 17-1375, S.D. Texas).

  • December 7, 2017

    Pension Fund Found To Have Failed To Plead Falsity, Scienter In Securities Suit

    CHICAGO — Dismissal of a securities class action lawsuit against a for-profit college and certain of its current and former senior executives is warranted because the lead plaintiff in the action failed to plead falsity or scienter in making its federal securities law claims against the defendants, a federal judge in Illinois ruled Dec. 6 in granting the defendants’ motion (Pension Trust Fund for Operating Engineers v. DeVry Education Group Inc., et al., No. 16-5198, N.D. Ill., 2017 U.S. Dist. LEXIS 200272).

  • December 7, 2017

    Panel: Shareholders Properly Pleaded Scienter In Securities Class Action

    NEW YORK — A federal district court erred in dismissing a securities class action lawsuit against a China-based online and mobile commerce company and certain of its senior officers because shareholders had properly pleaded that the defendants acted with the requisite scienter by concealing that the company was subject to administrative proceedings by China’s State Administration for Industry and Commerce (SAIC) in the months leading up to its initial public offering (IPO), a Second Circuit U.S. Court of Appeals panel ruled Dec. 5 in reversing and remanding (Christine Asia Co. Ltd., et al. v. Jack Yun Ma, et al., No. 16-2519, 2nd Cir.).

  • December 6, 2017

    9th Circuit Panel Hears Oral Argument In Accounting Misrepresentation Lawsuit

    SAN FRANCISCO — Parties in a securities class action lawsuit against a company that sells renewable energy and certain of its executive officers asked a Ninth Circuit U.S. Court of Appeals panel on Dec. 4 to determine whether a federal district court erred in dismissing the action for failure to plead scienter under a holistic approach (James Webb v. SolarCity Corp., et al., No. 16-16440, 9th Cir.).

  • December 6, 2017

    Federal Judge Partially Grants TRO In Ponzi Scheme Lawsuit

    DENVER — A federal judge in Colorado on Nov. 14 granted in part and denied in part the Securities and Exchange Commission’s motion for a temporary restraining order (TRO) in a lawsuit stemming from a Ponzi scheme orchestrated by a hedge fund manager, ruling that the SEC has properly shown that it is likely to succeed on its claims against the estate of the manager and his investment company but has failed to show which of the Ponzi scheme proceeds the other defendants received were ill-gotten gains (SEC v. End of the Rainbow Partners LLC, et al., No. 17-2670, D. Colo., 2017 U.S. Dist. LEXIS 187534).

  • December 5, 2017

    Federal Prosecutors Seek $7.3M Forfeiture From Shkreli In Criminal Action

    BROOKLYN, N.Y. — Federal prosecutors in the criminal proceedings against convicted former pharmaceutical company CEO and hedge fund manager Martin Shkreli on Nov. 30 asked a federal judge to require him to forfeit more than $7.3 million he obtained as part of his role in the securities fraud scheme to defraud investors (United States of America v. Martin Shkreli, No. 15-637, E.D. N.Y.).

  • December 4, 2017

    Government Changes Course, Asks High Court To Review SEC ALJ Appointment Dispute

    WASHINGTON, D.C. — In a change of course, the U.S. government in a Nov. 29 respondent’s brief asked the U.S. Supreme Court to review an appeal of a District of Columbia Circuit U.S. Court ruling that Securities and Exchange Commission administrative law judges (ALJs) are constitutional officers pursuant to the appointments clause of the U.S. Constitution (Raymond J. Lucia, et al. v. Securities and Exchange Commission, No. 17-130, U.S. Sup.).

  • December 1, 2017

    Ruling In Securities Suit Conflicts With Supreme Court Precedent, Investor Says

    RICHMOND, Va. — The lead plaintiff in a securities class action lawsuit against an energy provider and its CEO asked the Fourth Circuit U.S. Court of Appeals on Nov. 29 to rehear its appeal of a federal district court’s dismissal of its amended complaint for failure to plead scienter, claiming that the panel’s opinion affirming the lower court’s ruling is in conflict with U.S. Supreme Court and Fourth Circuit precedent (Maguire Financial LP, et al. v. PowerSecure International Inc., et al., No. 16-2163, 4th Cir.).

  • December 1, 2017

    Judge Certifies Investor Class In Securities Suit Against SeaWorld, Others

    SAN DIEGO — Lead plaintiffs in a securities class action lawsuit against SeaWorld Entertainment Inc. and certain of its current and former executive officers over their alleged concealment of the negative impact the document “Blackfish” had on the company’s business and financial condition have met all statutory requirements to certify the class of investors, a federal judge in California ruled Nov. 29 in certifying the class (Lou Baker v. SeaWorld Entertainment Inc., et al., No. 14-2129, S.D. Calif., 2017 U.S. Dist. LEXIS 196235).

  • November 30, 2017

    9th Circuit Panel Affirms HP Shareholder Derivative Action Settlement Approval

    SAN FRANCISCO — A federal judge did not abuse his discretion in approving the terms of a third proposed settlement in a shareholder derivative lawsuit stemming from Hewlett-Packard Co.’s (HP) acquisition of a British software company because the settlement, among other things, caused HP to enact certain corporate governance measures, a Ninth Circuit U.S. Court of Appeals panel ruled Nov. 28 (In re:  Hewlett-Packard Co. Shareholder Derivative Litigation, No. 15-16688, 9th Cir., 2017 U.S. App. LEXIS 24055).

  • November 29, 2017

    COMMENTARY: When Strategies Go Awry: Part 2 in a Series on Cognitive Biases and Their Impact

    By Laura A. Frase

  • November 29, 2017

    U.S. Supreme Court Hears Oral Arguments In SLUSA Preemption Appeal

    WASHINGTON, D.C. — In writing the Securities Litigation Uniform Standards Act (SLUSA), Congress intended to eliminate concurrent jurisdiction for many federal claims arising from the Securities Act of 1933, even if it took an “obtuse” approach to saying as much, counsel for Cyan Inc. told the U.S. Supreme Court  Nov. 28 in oral arguments in an appeal of a California Superior Court ruling that shareholders in a securities class action are not preempted by SLUSA from bringing their Securities Act claims (Cyan Inc. v. Beaver County Employees Retirement Fund, et al., No. 15-1439, U.S. Sup.).

  • November 28, 2017

    U.S. High Court Hears Dodd-Frank Whistleblower Oral Arguments

    WASHINGTON, D.C. — The statutory definition of whistleblower applies to the anti-retaliation provision of the Dodd-Frank Act, Kannon K. Shanmugam of Williams & Connolly in Washington, counsel for Digital Realty Trust Inc., told the U.S. Supreme Court justices during oral argument Nov. 28 (Digital Realty Trust Inc. v. Paul Somers, No. 16-1276, U.S. Sup.).

  • November 27, 2017

    District Court’s Dismissal Of Securities Suit Not Erroneous, Panel Rules

    SAN FRANCISCO — A federal district court did not err in dismissing a securities class action lawsuit against crowd-sourced review platform Yelp Inc. and certain of its executive officers because the lead plaintiff in the action failed to show that the disclosure of consumer complaints, without more, is sufficient to plead loss causation, a Ninth Circuit U.S. Court of Appeals panel ruled Nov. 21 (Joseph Curry, et al. v. Yelp Inc., et al., No. 16-15104, 9th Cir., 2017 U.S. App. LEXIS 23563).

  • November 27, 2017

    Drug Company To Pay $24M To Settle Claims In Securities Class Action Suit

    CHICAGO — Pharmaceutical company Akorn Inc. has agreed to pay $24 million to settle claims that it and certain of its current and former executive officers misrepresented the company’s financial results in violation of federal securities laws, according to a motion for preliminary approval of settlement filed by lead plaintiffs in Illinois federal court on Nov. 20 (In re Akorn Inc. Securities Litigation, No. 15-1944, N.D. Ill.).

  • November 22, 2017

    Rehearing Sought Of 2nd Circuit Ruling In Barclays Securities Lawsuit

    NEW YORK — Rehearing of a Second Circuit U.S. Court of Appeals panel’s ruling affirming a federal district court’s grant of class certification in a securities lawsuit is necessary because the panel’s ruling is in conflict with U.S. Supreme Court and federal circuit court precedent, defendants argue in a Nov. 20 petition for rehearing and rehearing en banc (Joseph Waggoner, et al. v. Barclays PLC, et al., No. 16-1912, 2nd Cir.).

  • November 22, 2017

    2nd Circuit Asked To Decide If Amendment Of Securities Complaint Was Futile

    NEW YORK — Parties in a securities class action lawsuit recently asked the Second Circuit U.S. Court of Appeals to determine whether a federal district court erred in denying the lead plaintiff’s motion for leave to file a third amended complaint in the action because amendment would be futile (Waterford Township Police & Fire Retirement System v. Regional Management Corp., et al., No. 17-0598, 2nd Cir.).

  • November 22, 2017

    Panel Asked To Decide If Securities Suit Was Properly Dismissed Under Morrison

    SAN FRANCISCO — Parties in a securities class action lawsuit against an electronic and energy products and services manufacturer and provider recently asked the Ninth Circuit U.S. Court of Appeals to determine whether a federal district court erred in dismissing U.S. federal and Japanese securities law claims under the U.S. Supreme Court’s transactional test established in Morrison v. National Australia Bank (Automotive Industries Pension Trust Fund, et al. v. Toshiba Cop., No. 16-56058, 9th Cir.).

  • November 22, 2017

    Investors Failed To Plead Loss Causation In Securities Suit, Defendants Say

    LOS ANGELES — Lead plaintiffs in a securities class action lawsuit against a drug maker, certain of its current and former officers and directors and others have failed to plead loss causation in arguing that the defendants engaged in an illegal stock-pumping scheme in violation of federal securities laws, the defendants argue in a Nov. 10 motion to dismiss filed in California federal court (Arthur Kaye IRA FCC, et al. v. ImmunoCellular Therapeutics Ltd., et al., No. 17-3250, C.D. Calif.).

  • November 17, 2017

    4th Circuit Affirms Dismissal Of Securities Suit For Failure To Plead Scienter

    RICHMOND, Va. — Shareholders in a securities class action lawsuit against an energy provider and its CEO have failed to show that the CEO acted with the requisite scienter in misrepresenting to investors that the company had secured a contract renewal with a large customer because they have not shown that he knew his statements were misleading at the time he made them, a Fourth Circuit U.S. Court of Appeals panel ruled Nov. 15 in affirming a federal judge’s dismissal of the action (Maguire Financial LP, et al. v. PowerSecure International Inc., et al., No. 16-2163, 4th Cir., 2017 U.S. App. LEXIS 22968).