Lexis Legal News : Mealey's Securities : Lawsuit Filings, Litigation, Settlements, Verdicts and Court News

Mealey's Securities

December 04, 2020
Investor Sues Citigroup, Others Over Risk Management Misrepresentations

NEW YORK — Citigroup Inc. and certain of its current and former executive officers concealed from investors that the financial institution was not in compliance with the terms of regulatory settlements it agreed to with federal agencies by failing under the terms of the settlements to provide proper oversight of its internal controls and risk management in violation of federal securities laws, an investor alleges in a Nov. 13 class action complaint filed in New York federal court (City of Sterling Heights General Employees’ Retirement System v. Citigroup Inc., et al., No. 20-9573, S.D. N.Y.).
December 04, 2020
District Court Approval Of SEC Settlement With Energy Company Sought

COLUMBIA, S.C. — The Securities and Exchange Commission on Dec. 3 asked a federal judge in South Carolina to grant final judgment of a proposed settlement in a proposed in a securities fraud lawsuit against energy provider SCANA Corp. and its subsidiary for allegedly issuing misrepresentations in violation of federal securities laws regarding a planned expansion of a nuclear power plant that was later abandoned (United State Securities and Exchange Commission v. SCANA Corp., et al., No. 20-882, D. S.C.).
December 03, 2020
Judge: Investor’s Scienter Allegations Lacking In Campbell Soup Stock-Drop Suit

CAMDEN, N.J. — The lead plaintiff in a securities class action lawsuit against Campbell Soup Co. and certain of its senior executives failed to sufficiently plead scienter in alleging that the defendants misrepresented the company’s ability to deliver profitable growth in violation of federal securities law, a federal judge in New Jersey ruled Nov. 30 in granting the defendants’ motion to dismiss (In re Campbell Soup Co. Securities Litigation, No. 18-14385, D. N.J., 2020 U.S. Dist. LEXIS 223579).
December 03, 2020
Pinterest Board Named In Shareholder Suit Alleging Racial, Sexual Discrimination

SAN FRANCISCO — Pinterest Inc.’s board of directors and certain of the company’s senior executives breached their fiduciary duty by aiding a culture of illegal racial and sexual discrimination in the workplace, an investor alleges in a Nov. 30 shareholder derivative complaint filed in California federal court (The Employees’ Retirement System of Rhode Island v. Benjamin Silbermann, et al., No. 20-8438, N.D. Calif.).
December 02, 2020
Deposition Subpoena Of Drug Firm’s Trial Counsel Quashed In Securities Lawsuit

DETROIT — The lead plaintiffs in a securities lawsuit over a pharmaceutical firm’s allegedly false statements about a cholesterol drug’s approval failed to establish the necessary conditions to justify the “highly disfavored” practice of subpoenaing the deposition of a defendant’s trial counsel, a Michigan federal magistrate judge ruled Nov. 30, granting the drug company’s motion to quash the subpoena (Kevin L. Dougherty, et al. v. Esperion Therapeutics Inc., et al., No. 16-10089, E.D. Mich., 2020 U.S. Dist. LEXIS 223221).
December 01, 2020
Platinum Partners Former Marketing Employee Dismissed From Securities Fraud Case

BROOKLYN, N.Y. — A federal judge in New York on Nov. 23 dismissed an indictment against a former Platinum Partners marketing employee over his role in alleged securities fraud schemes to transfer Platinum Partners’ assets to a reinsurance company and related entities to defraud bondholders in an oil and gas company (United States v. Joseph Mann, 16-cr-640, E.D. N.Y.).
November 24, 2020
Shareholder Derivative Suit Over Short-Swing Profits Sent Back To District Court

NEW YORK — Factual questions exist on the issue of a 1-800-Flowers’ shareholder’s beneficial ownership of the company’s stock and whether it was subject to liability under federal securities law and, in particular, disgorgement of short-swing profits, a Second Circuit U.S. Court of Appeals panel ruled Nov. 23 in remanding a shareholder derivative lawsuit to federal district court (Brad Packer v. Raging Capital Management LLC, et al., Nos. 19-2703 and 19-2852, 2nd Cir., 2020 U.S. App. LEXIS 36748).
November 24, 2020
Reinsurer, Former Officers: No Alleged Misconduct Motive In Securities Class Action

CAMDEN, N.J. — A securities class action rests on the “implausible inference” that a reinsurer’s modeling and estimation choices “amount to deliberate under-reserving and fraud,” the reinsurer and former officers argue in a Nov. 23 reply brief to a New Jersey federal court, seeking dismissal for a lack of motive for any alleged misconduct (In re Maiden Holdings, Ltd. Securities Litigation, No. 19-05296, D. N.J.).
November 23, 2020
Investor Sues Online Education Provider Over Coronavirus Misstatements

ALEXANDRIA, Va. — A technology-based education company that operates virtual learning systems and two of its senior executives violated federal securities laws by misrepresenting to investors that the company was technologically equipped to handle an influx of business stemming from the nationwide closure of in-class instruction in response to the global novel coronavirus pandemic, an investor alleges in a Nov. 19 securities class complaint filed in Virginia federal court (Yun Chau Lee v. K12 Inc., et al., No. 20-1419, E.D. Va.).
November 20, 2020
3rd Circuit: 3M Shareholder Case Related To PFAS Liability Belongs In Minnesota

PHILADELPHIA — A panel of the Third Circuit U.S. Court of Appeals on Nov. 18 ruled that a shareholder class action claiming that the 3M Co. and its officers concealed the truth about the company’s exposure to liability associated with per- and polyfluoroalkyl substances (PFAS) in violation of federal securities laws belongs in Minnesota federal court because claims based on false statements or omissions arise in the district where they occurred (In re 3M Co., et al., No. 20-2864, 3rd Cir.).
November 20, 2020
11th Circuit To Hear Appeal Of Class Certification Ruling In Stock-Drop Suit

ATLANTA — In a one-page ruling, an 11th Circuit U.S. Court of Appeals panel on Nov. 18 granted permission for a provider of lighting and building management solutions and certain of its current and former executive officers to appeal a federal district court’s ruling certifying a class of investors in a securities class action lawsuit alleging that the appellants misrepresented the company’s sales growth in violation of federal securities laws (Acuity Brands Inc., et al. v. Public Employees’ Retirement System of Mississippi, No. 20-90018-A, 11th Cir., 2020 U.S. App. LEXIS 36261).
November 16, 2020
Investor Claims In Grubhub Stock-Drop Suit Lacking, Defendants Argue

CHICAGO — Dismissal of federal securities law claims against online food ordering and delivery company Grubhub Inc. and two of its executive officers is necessary because a lead plaintiff’s allegations are statutorily insufficient and should be dismissed with prejudice, the defendants argue in a Nov. 11 motion to dismiss filed in Illinois federal court (Roei Azar v. Grubhub Inc., et al., No. 19-7665, N.D. Ill.).
November 13, 2020
Investors: High Court Review Of Securities Class Certification Ruling Unneeded

WASHINGTON, D.C. — The U.S. Supreme Court should deny review of a divided Second Circuit U.S. Court of Appeals panel’s ruling upholding a federal district court’s application of the inflation-maintenance theory for demonstrating price impact in granting class certification in a securities class action against Goldman Sachs Group Inc. and three of its senior executives because no federal court has accepted the position that the petitioners offer as a reason to grant review in this instance, institutional investors argue in an Oct. 21 opposition brief filed in the Supreme Court (Goldman Sachs Group Inc., et al. v. Arkansas Teacher Retirement System, et al., No. 20-222, U.S. Sup., 2020 U.S. S. Ct. BRIEFS LEXIS 4214).
November 13, 2020
Elements Of Securities Fraud Claims Not Met In Stock-Drop Lawsuit, Judge Rules

SAN FRANCISCO — A federal judge in California on Nov. 9 ruled that dismissal of federal securities law claims in a securities class action against a customer service software company and certain of its senior executives stemming from the defendants’ alleged misrepresentations pertaining to the company’s financial condition in its European, African and Asian markets and data breach is warranted because the lead plaintiff failed to sufficiently plead any material misstatement or omission or scienter in making its federal securities law claims (Charles Reidinger v. Zendesk Inc., et al., No. 19-6968, N.D. Calif., 2020 U.S. Dist. LEXIS 209548).
November 12, 2020
Cannabis Company Seeks Dismissal Of Shareholder Claims In Stock-Drop Suit

LOS ANGELES — Dismissal of a securities class action lawsuit against a Canadian producer of medicinal-grade cannabis oil and certain of its senior executives is warranted because the lead plaintiffs’ federal securities law claims rely on allegations made in a published report that was nothing more than a “short-seller attack” that were later determined to be incorrect, the defendants argue in an Oct. 21 motion to dismiss filed in California federal court (In re PharmaCielo Ltd. Securities Litigation, No. 20-2182, C.D. Calif.).
November 12, 2020
Court-Appointed Amicus Curiae Weighs In On FHFA Constitutionality Appeal

WASHINGTON, D.C. — In an Oct. 16 brief, a court-appointed amicus curiae tells the U.S. Supreme Court that it should reverse a federal appellate court’s finding that the structure of the Federal Housing Finance Agency (FHFA) is unconstitutional but failed to set aside the FHFA’s adoption of a net worth sweep as conservator of the Federal National Mortgage Association (Fannie Mae) and the Federal Home Loan Mortgage Corp. (Freddie Mac) based on recent Supreme Court precedent because the appellate court’s finding is “opposite” of the Supreme Court’s ruling “in a critical respect” (Patrick J. Collins, et al. v. Steven T. Mnuchin, et al., No. 19-422, and Steven T. Mnuchin, et al. v. Patrick J. Collins, et al., No. 19-563, U.S. Sup.).
November 12, 2020
Wells Fargo Hit With Investor Suit Over Loan Portfolio Misrepresentations

SAN FRANCISCO — Wells Fargo & Co. and certain of its current and former executive officers misrepresented the financial viability of its commercial loan portfolio and engaged in the same loan origination and marketing of its commercial loans that resulted in a multibillion dollar financial crisis-era settlement with the U.S. Department of Justice in violation of federal securities law, an investor alleges in an Oct. 30 securities class action complaint filed in California federal court (Steven A. Mullen v. Wells Fargo & Co., et al., No. 20-7674, N.D. Calif.).
November 11, 2020
Company Tells 2nd Circuit That Stock-Drop Claims Were Properly Dismissed

NEW YORK — A federal district court in New York did not err in dismissing shareholder allegations that a transportation company and certain of its current and former executive officers violated federal securities law by failing to disclose their involvement in an alleged overcharge scheme because the shareholders failed to plead the conduct underlying their claims with particularity, as statutorily required, the company and its officers allege in a Nov. 9 appellee brief filed in the Second Circuit U.S. Court of Appeals (City of Warwick Retirement Fund, et al. v. YRC Worldwide Inc., et al., No. 20-1427, 2nd Cir.).
November 11, 2020
WWE Shareholder Derivative Suits Dismissed For Failure To Plead Demand Futility

NEW HAVEN, Conn. — A federal judge in Connecticut on Nov. 6 ruled that investors in three related shareholder derivative lawsuits filed against several of sports entertainment company World Wrestling Entertainment Inc.’s (WWE) senior executives and board of directors members have failed to sufficiently plead demand futility in bringing claims that the defendants breached their fiduciary duty by failing to disclose the renewal status of two lucrative television contracts in the Middle East and North Africa (MENA) market (Ryan Merholz, et al. v. Vincent K. McMahon, et al., No. 20-557, Daniel Kooi v. Vincent K. McMahon, et al., No. 20-743 and Rodney Nordstrom v. Vincent K. McMahon, et al., No. 20-904, D. Conn., 2020 U.S. Dist. LEXIS 208647).
November 10, 2020
Panel Upholds Order Denying Motion To Vacate Sentence In Securities Fraud Action

NEW YORK — A federal district court did not err in denying a defendant’s motion to vacate, set aside or correct a judgment against him for his role in a securities, wire and mail fraud scheme because the defendant failed to show that his counsel provided ineffective assistance at trial, a Second Circuit U.S. Court of Appeals panel ruled on Nov. 5 (Mark A. Shapiro v. United States of America, No. 18-2902, 2nd Cir., 2020 U.S. App. LEXIS 35199).