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Mealey's Securities

  • April 16, 2024

    Federal Judge Rules SEC Showed Municipal Adviser Failed To Disclose Material Info

    SAN DIEGO — A federal judge in California on April 15 issued a mixed order on a motion for partial summary judgment by the Securities and Exchange Commission, finding that the SEC adequately showed that a municipal advisory company and its co-founder withheld material information from municipal bond clients about the co-founder’s former employer but that there is a triable issue over whether the co-founder disclosed a fee-splitting agreement with his former employer to the clients.

  • April 16, 2024

    Delaware High Court Partly Revives Investor Claims Against Dating Site Companies

    WILMINGTON, Del. — The Delaware Supreme Court partially reversed a decision from the state’s Court of Chancery in a putative class case brought by shareholders questioning the fairness of a technology company’s spinoff from a controlled subsidiary, finding that the investors adequately alleged that one member of a separation committee lacked independence from the tech company.

  • April 15, 2024

    Judge Partly Grants Insurer’s Motion To Compel In D&O Coverage Dispute Over Merger

    WILMINTON, Del. — A Delaware judge on April 12 granted in part and denied in part a directors and officers liability insurer’s motion to compel discovery in a coverage dispute over claims that directors, officers and controlling shareholders breached their fiduciary duties in connection with the 2019 merger of Viacom and CBS Corp.

  • April 15, 2024

    SEC: Attorney, Developer Entities Misused Investor Cash For Unrelated Projects

    LAS VEGAS — In a complaint filed in a Nevada federal court, the Securities and Exchange Commission says an attorney and three entities she managed defrauded foreign investors by selling securities to fund the construction of skilled nursing facilities in the Las Vegas area before using the funds for unrelated purposes.

  • April 15, 2024

    Federal Judge Finds Broker’s Client’s Claims Precluded By SLUSA

    NEW YORK — A federal judge in New York dismissed a putative class complaint brought against an investment company and certain of its employees by a client who said the company failed to disclose that a team heading a new investment program was involved in arbitration with the team members’ former employer, finding that the client’s claims are barred by the Securities Litigation Uniform Standards Act (SLUSA).

  • April 12, 2024

    Supreme Court Finds Pure Omissions Not Actionable Under SEC Rule

    WASHINGTON, D.C. — A unanimous U.S. Supreme Court held April 12 that a private securities action cannot be brought on the basis of an omission on filings with the Securities and Exchange Commission if the omission does not render other statements misleading, finding that pure omissions are not actionable under SEC Rule 10b-5.

  • April 12, 2024

    Retirement Fund Says Health Company Misled Investors About Profit Margins

    NEW YORK — A retirement system filed a putative class complaint against a health care company in a New York federal court, saying the company and certain of its executives made material representations to investors, including allegedly overstating margins of profit by hundreds of millions of dollars, leading to a decline in stock value.

  • April 12, 2024

    Federal Judge: Tech Firm Does Not Show Loss Causation In Stock Spoofing Case

    NEW YORK — While a federal judge in New York found that a technology company adequately alleged that an investment company knowingly ran a manipulative scheme involving “spoofing” the tech company’s stock, the judge found that the tech company did not adequately show that it suffered a loss as a result of the scheme and thus granted the investment company’s motion to dismiss.

  • April 11, 2024

    Federal Judge: Investors Cite No False Claims In Gene Therapy Securities Suit

    BOSTON — A federal judge in Massachusetts dismissed a putative class complaint filed by investors against a biopharmaceutical company and certain of its executives, finding that the investors did not substantiate their claim that the company issued false and misleading statements about a gene therapy program it was testing before the Food and Drug Administration ordered a hold on testing.

  • April 10, 2024

    Pharma Companies Seek High Court Review Of Ruling Reversing FCA Suit Dismissal

    WASHINGTON, D.C. — Pharmaceutical companies accused of violating the False Claims Act (FCA) by artificially inflating drug prices filed a petition for writ of certiorari in the U.S. Supreme Court, seeking review of the Ninth Circuit U.S. Court of Appeals’ reversal of a district court’s dismissal of a qui tam suit against them, arguing, in part, that the panel “created a circuit split by holding that a relator can avoid the public disclosure bar by ‘stitching together’ public disclosures.”

  • April 10, 2024

    Amici Support Facebook Before High Court, Say Split Over Disclosure Must End

    WASHINGTON, D.C. — Multiple groups filed a total of three amicus curiae briefs with the U.S. Supreme Court arguing that the court should grant a petition for a writ of certiorari filed by the company formerly known as Facebook Inc., echoing the social media giant’s argument that the Ninth Circuit U.S. Court of Appeals deepened a circuit split over what public companies must disclose when it partly revived a putative class complaint brought by investors.

  • April 10, 2024

    Musk: SEC Response Illustrates Need For High Court Review Of Settlement

    WASHINGTON, D.C. — In a reply brief in further support of his petition for a writ of certiorari, Elon Musk reiterates to the U.S. Supreme Court that a consent judgment he signed with the Securities and Exchange Commission violated his constitutional right by imposing prior restraint, arguing that the SEC’s resistance to “scrutiny of its settling authority underscores exactly why the Court should grant review.”

  • April 10, 2024

    Securities Claim Over Walmart’s Opioid Sales Tossed For Lack Of False Statements

    WILMINGTON, Del. — A federal judge in Delaware dismissed a putative class complaint brought by an investor against Walmart Inc. and certain of its executives, finding that the investor did not substantiate the claim that Walmart misled investors about the potential impacts of criminal and civil investigations into its sale of opioids conducted by federal officials in Texas.

  • April 09, 2024

    9th Circuit Revives Investors’ Suit Against Entertainment Company

    PASADENA, Calif. — The Ninth Circuit U.S. Court of Appeals partly revived a suit by shareholders of Genius Brands International Inc. who claim the company and its CEO made misleading statements to investors, saying a California federal judge erred in finding that some of the company’s claims were not materially misleading.

  • April 09, 2024

    Jury Finds Terraform, CEO Liable For Misleading Investors In SEC Suit

    NEW YORK — A federal jury in New York found that crypto asset firm Terraform Labs Pte. Ltd. and its founder and chief executive officer are liable for all claims brought against them by the Securities and Exchange Commission, which accused the company and its founder of issuing many false statements about the company’s crypto assets.

  • April 09, 2024

    6th Circuit Affirms Rulings In Professional Liability Coverage Dispute

    CINCINNATI — The Sixth Circuit U.S. Court of Appeals on April 8 affirmed a lower federal court’s summary judgment rulings in a professional liability coverage dispute arising from a financial adviser insured’s valuations for a bankrupt paper manufacturing company and its Employee Stock Ownership Plan, finding that the insurer had a duty to defend its insured until only claims falling under a policy exclusion remained and that the insured has to reimburse the insurer for defending it after the same exclusion applied.

  • April 09, 2024

    Investors, Pharmaceutical Company Seek Approval Of Securities Claims Settlement

    CAMDEN, N.J. — A pharmaceutical company and certain of its executives have agreed to settle for $97 million a securities class action by investors accusing the company of artificially inflating stock value to stave off a buyout, according to a motion for preliminary settlement approval filed by the lead plaintiff.

  • April 08, 2024

    2nd Circuit Partially Revives Securities Claims Against Coinbase

    NEW YORK — A Second Circuit U.S. Court of Appeals panel on April 5 partly revived a securities suit brought against a crypto asset exchange, finding that a federal judge in New York failed to assess which version of multiple user agreements was relied on to dismiss users’ claims against the company.

  • April 08, 2024

    SEC Announces Stay Of Climate Rules Pending Review By 8th Circuit

    WASHINGTON, D.C. — The Securities and Exchange Commission announced that it will stay its newly implemented rules requiring companies to disclose information related to risks they face from climate-related issues while a review of the rules is pending before the Eighth Circuit U.S. Court of Appeals.

  • April 04, 2024

    Insured Appeals Court’s Ruling That Bump-Up Exclusion Bars D&O Coverage

    ALEXANDRIA, Va. — An insured on April 3 filed a notice of appeal in a Virginia federal court asking the Fourth Circuit U.S. Court of Appeals to review the lower court’s holding that a “bump-up” exclusion unambiguously precludes directors and officers liability insurance coverage for the $90 million settlement of two underlying lawsuits arising from a 2015 merger.

  • April 04, 2024

    Judge Stays Stock Redemption Row Between Equity Firm And Agent Liquidating Insurer

    TAMPA, Fla. — One day after granting in part summary judgment to a private equity firm and limited partnership in a fraudulent transfer of property dispute among the firm and partnership and the liquidator for an insolvent health insurer, a Florida federal judge issued a docket-only order staying and administratively closing the case pending scheduling for trial.

  • April 04, 2024

    Lead Plaintiff Is Appointed In Suit Over Alleged Securities Violations

    NEW YORK — An investor who alleges that he lost approximately $56,250 due to stock declines after a Bermuda-based insurance holding company reported an error involving the reinstatement premium for a specialty casualty reinsurance treaty has been appointed lead plaintiff of a putative class action under the Securities Exchange Act of 1934.

  • April 03, 2024

    Judge Preliminarily Approves $350M Settlement In Securities Suit Against Google

    SAN FRANCISCO — A federal judge in California granted preliminary approval to a $350 million settlement of a putative class complaint filed by investors in Google LLC and its parent company Alphabet Inc. who claimed that the companies issued false statements about the safety of the now defunct Google+ social media platform.

  • April 03, 2024

    Judge Grants SEC Summary Judgment After Companies, Founders Don’t Respond

    HOUSTON — A federal judge in Texas granted a Securities and Exchange Commission motion for partial summary judgment, finding that there was no genuine issue of fact in a case the SEC brought accusing two related companies and their husband and wife founders of defrauding investors after none of the defendants responded to the motion.

  • March 29, 2024

    Investor Says Company Misled About AI Product’s Ability To Identify Weaponry

    BOSTON — An investor says in a putative class complaint filed in Massachusetts federal court that an artificial intelligence company and certain of its executives misled investors by overstating the abilities of an artificial intelligence-powered security system developed by the company to detect weapons, after the media reported that a knife that got into a school using the security system was used in an attack on a student.