TRENTON, N.J. — A federal judge in New Jersey on Sept. 10 ruled that dismissal of a securities class action lawsuit against specialty pharmaceutical and medical device company Valeant Pharmaceuticals International Inc. and certain of its former senior executives is necessary because the shareholders’ claims are untimely and not subject to tolling pursuant to the American Pipe & Construction Co. v. Utah tolling doctrine (Bahaa Aly, et al. v. Valeant Pharmaceuticals International Inc., et al., No. 18-17393, D. N.J., 2019 U.S. Dist. LEXIS 155223).
NEW YORK — Shareholders of a Chinese internet company have failed to plead any material misrepresentations or omissions or scienter in arguing that the company and its CEO violated federal securities laws by failing to disclose that the company had engaged in an initial coin offering (ICO), which was banned by Chinese authorities, a federal judge in New York ruled Sept. 10 (In re Xunlei Ltd. Securities Litigation, No. 18-467, S.D. N.Y., 2019 U.S. Dist. LEXIS 154010).
RICHMOND, Va. — A split Fourth Circuit U.S. Court of Appeals panel on Aug. 30 ruled that a federal district court erred in finding that a shareholder’s claims in a securities class action stemming from a merger deal were time-barred because the district court improperly applied the inquiry notice standard in support of its ruling (In re Willis Towers Watson plc Proxy Litigation, No. 18-1874, 4th Cir., 2019 U.S. App. LEXIS 26417).
TRENTON, N.J. — Dismissal of a securities class action against health care products manufacturer Johnson & Johnson (J&J) and several of its current and former senior executives is not warranted because the lead plaintiff in the action has sufficiently pleaded each element of its federal securities law claims, the lead plaintiff argues in a June 28 opposition brief (Frank Hall v. Johnson & Johnson, et al., No. 18-1833, D. N.J.).
NEW ORLEANS — In an unpublished, per curiam opinion, a Fifth Circuit U.S. Court of Appeals panel on Aug. 23 ruled that a federal district court did not err in dismissing a lead plaintiff’s third amended securities class action complaint against a provider of custom-engineered equipment and modification and maintenance services and others for failure to properly plead scienter in making her federal securities law claims (Margaret Budde v. Global Power Equipment Group Inc., et al., No. 18-11206, 5th Cir., 2019 U.S. App. LEXIS 25428).
NEW YORK — A federal district court did not err in dismissing investors’ breach of contract lawsuit against a mutual fund over its concentration of investments in the health care industry because guidance issued by the Securities and Exchange Commission in 1998 allowed for passive increases in the value of the fund’s assets, a Second Circuit U.S. Court of Appeals panel ruled Sept. 9 (Thomas Edwards, et al. v. Sequoia Fund Inc., No. 18-3467, 2nd Cir., 2019 U.S. App. LEXIS 27072).
NEW YORK — A stockholder of Peak Resorts Inc. sued the company and its Board of Directors in a New York federal court on Sept. 6, alleging that the defendants issued a proxy statement for a proposed merger deal with Vail Resorts Inc. that was materially deficient and failed to disclose certain information required before stockholders may vote on the proposed merger (Eammon Carleton v. Peak Resorts Inc., et al., No. 19-8314, S.D. N.Y.).
ATLANTA — A federal district court did not err in granting a motion for summary judgment filed by defendants in a shareholder derivative lawsuit on behalf of nominal defendant Aflac Inc. because the shareholders failed to show that a special litigation committee’s (SLC) investigation based on the shareholders’ demand was unreasonable or in bad faith, an 11th Circuit U.S. Court of Appeals panel ruled Sept. 5 (Martin Conroy, et al. v. Paul S. Amos II, et al., No. 18-13834, 11th Cir., 2019 U.S. App. LEXIS 26757).
CHICAGO — For-profit college operator Adtalem Global Education Inc. will pay $27.5 million to settle investor claims that it misrepresented statistics related to its job-placement rates and concealed information regarding regulatory agency investigations into its business operations, a shareholder asserts in an Aug. 30 motion for preliminary approval of settlement filed in Illinois federal court (Pension Trust Fund for Operating Engineers v. DeVry Education Group Inc., et al., No. 16-5198, N.D. Ill.).
NEW YORK — Ruling that objectors to a nearly $3 billion securities class action settlement between shareholders and Brazilian oil company Petróleo Brasileiro S.A. (Petrobras) and others waived their arguments against the settlement on appeal because they failed to bring the arguments in the federal district court overseeing the lawsuit, a Second Circuit U.S. Court of Appeals panel on Aug. 30 upheld the lower court’s ruling granting final approval of the settlement (In re Petrobras Securities Litigation, No. 18-2270, 2nd Cir., 2019 U.S. App. LEXIS 26475).
FORT LAUDERDALE, Fla. — A federal judge in Florida on Aug. 29 held that although an investor sufficiently alleged an injury in fact to establish that he has standing to bring his securities class action against a beverage maker and certain of its senior executives, he failed to properly state a claim for relief (Thomas W. Luczak v. National Beverage Corp., et al., No. 18-61631, S.D. Fla., 2019 U.S. Dist. LEXIS 147170).
WASHINGTON, D.C. — The Securities and Exchange Commission will not recommend enforcement measures against Honeywell International Inc. for its reporting of asbestos liabilities related to Bendix Friction Materials after the agency wrapped up an investigation it started late last year, the company said in an Aug. 29 SEC filing.
NEW ORLEANS — A federal district court erred in finding that investors lacked standing under Article III of the U.S. Constitution to sue their former investment advisers for securities fraud under Louisiana law, a Fifth Circuit U.S. Court of Appeals panel ruled Aug. 28 in vacating the district court’s ruling and remanding (Joseph Broyles, et al. v. Commonwealth Advisors Inc., et al., No. 17-30092, 5th Cir., 2019 U.S. App. LEXIS 26070).
ATLANTA — An 11th Circuit U.S. Court of Appeals panel on Aug. 28 upheld the conviction of an alleged Ponzi scheme participant, ruling that a federal district court did not err in denying her motion for acquittal on charges of wire fraud and conspiracy to commit wire fraud (United States v. Viktoriya Johnson, No. 18-13692, 11th Cir., 2019 U.S. App. LEXIS 25988).
SAN FRANCISCO — Shareholders in a securities class action lawsuit against a manufacturer of wearable fitness-tracking devices and certain of its executive officers have failed to plead impermissible fraud-by-hindsight in arguing that the defendants issued a series of misrepresentations regarding the company’s revenue projects and demand for new products in violation of federal securities laws, the defendants argue in an Aug. 23 motion to dismiss (Stephen Lopes v. Fitbit Inc., et al., No. 18-6665, N.D. Calif.).
CINCINNATI — A Sixth Circuit U.S. Court of Appeals panel on Aug. 23 ruled that a federal district court did not err in granting class certification in a securities class action brought against the owner of private correctional and detention facilities and certain of its current and former top executives, denying the defendants’ petition for permission to appeal the class certification decision (In re CoreCivic Inc., et al., No. 19-0504, 6th Cir., 2019 U.S. App. LEXIS 25508).
SAN FRANCISCO— Adopting and signing a proposed judgment submitted by the Securities and Exchange Commission, a California federal judge on Aug. 22 approved the commission’s $100 million civil penalty against Facebook Inc. for making misleading public statements about a known incident in which an analytics firm collected and sold the social network users’ personal data (Securities and Exchange Commission v. Facebook Inc., No. 3:19-cv-04241, N.D. Calif.).
NEW ORLEANS — A federal district court did not err in dismissing a shareholder class action lawsuit against home furnishings retailer Pier 1 Imports Inc. and two of its former senior executives because the lead plaintiff’s amendments to its complaint failed to cure the scienter pleading deficiencies that had led the district court to previously dismiss the lead plaintiff’s earlier-filed consolidated complaint, a Fifth Circuit U.S. Court of Appeals panel ruled Aug. 19 (Municipal Employees’ Retirement System of Michigan v. Pier 1 Imports Inc., et al., No. 18-10998, 5th Cir., 2019 U.S. App. LEXIS 24660).
HOUSTON — A shareholder on Aug. 18 filed a securities class action lawsuit against a provider of seismic data acquisition, logistical support and processing and integrated reservoir geosciences services and certain of its senior executives in Texas federal court, arguing that the defendants issued a series of false and misleading statements in its Securities and Exchange Commission reporting documents over a four-year period in violation of federal securities laws (John Bodin v. SAExploration Holdings Inc., et al., No. 19-3089, S.D. Texas).
WASHINGTON, D.C. — U.S. Supreme Court review of a Ninth Circuit U.S. Court of Appeals ruling in a Securities and Exchange Commission enforcement action is necessary because the appellate court’s reasoning in affirming a lower court’s grant of summary judgment has exacerbated a split among the federal circuits of appeal, as well as among several state courts of appeal, the defendant argues in a July 17 petition for writ of certiorari (Mitchell J. Stein v. U.S. Securities and Exchange Commission, No. 19-97, U.S. Sup., 2019 U.S. S. Ct. Briefs LEXIS 2681).