Mealey's Securities

  • August 13, 2021

    Federal Judge Denies Trustee’s Motion To Modify Trust Agreement

    FORT LAUDERDALE, Fla. — A federal judge in Florida on July 30 affirmed and adopted a magistrate judge’s report recommending that a trustee’s motion to modify a trust agreement be denied in a Securities Exchange Commission lawsuit alleging fraudulent selling of investment interests in life insurance policies.

  • August 12, 2021

    Shareholders Fail To Plead Loss Causation In Stock-Drop Suit Against Drug Maker

    SAN FRANCISCO — In an Aug. 10 order, a federal judge in California ruled that although shareholders in a securities class action lawsuit against a drug maker and others stemming from the defendants’ alleged misrepresentation of sales expectations and usage of the company’s coagulant drug have sufficiently pleaded an actionable misstatement or omission and scienter, dismissal of their federal securities law claims is necessary because they have failed to properly plead loss causation.

  • August 12, 2021

    Investor Sues Cryptocurrency Exchange Over Alleged IPO Misstatements

    SAN FRANCISCO — A cryptocurrency exchange violated federal securities laws by failing to disclose that its online platform suffered from material weakness and that the exchange had significant cash flow issues in offering documents for its initial public offering (IPO), an investor alleges in an Aug. 10 class action complaint filed in California federal court.

  • August 10, 2021

    Lack Of Cogent Scienter Allegations Dooms Shareholder Claims

    WILMINGTON, Del. — A federal magistrate judge on Aug. 9 recommended that lead plaintiffs’ federal securities law claims against a for-profit higher education provider and two of its senior executives be dismissed because the lead plaintiffs have failed to sufficiently plead that the defendants acted with the requisite scienter in allegedly misrepresenting to investors that the U.S. Department of Education (DOE) would grant the provider nonprofit status to its for-profit university.

  • August 10, 2021

    Securities Suit Against Reinsurer To Proceed With Limited Discovery

    CAMDEN, N.J. — In an Aug. 6 opinion, a federal judge in New Jersey allowed a shareholder class action lawsuit against a reinsurer and certain of its former senior executives to proceed to discovery; however, the judge warned the lead plaintiffs that their federal securities law claims are “thin” and that some of their allegations are “conclusory” and may be disproven through a limited discovery process.

  • August 09, 2021

    Fracking Company:  Securities Fraud Case Fails; Allegations ‘Fall Far Short’

    HOUSTON — A hydraulic fracturing company on June 11 moved in Texas federal court to dismiss a shareholder securities class action on grounds that when viewed “holistically, the allegations do not show” that the company defrauded investors.

  • August 06, 2021

    Video Game Publisher Fostered ‘Frat Boy’ Workplace, Shareholder Alleges

    LOS ANGELES — A shareholder of video game publisher Activision Blizzard Inc. sued the company and certain of its current and former senior executives on Aug. 3 in California federal court, alleging that the defendants violated federal securities law by concealing a culture of sexual discrimination within the company in statements made in Securities and Exchange Commission documents from 2016 to 2021.

  • August 06, 2021

    Auto Maker Asks 9th Circuit To Deny Investor’s Rehearing Bid In Securities Suit

    SAN FRANCISCO — Volkswagen Aktiengesellschaft (VWAG) and others (collectively, VWAG) asked the Ninth Circuit U.S. Court of Appeals on Aug. 3 to deny a rehearing bid filed by a shareholder in a “mixed” securities fraud class action appeal because, in reversing and remanding, the panel majority’s findings were in line with the U.S. Supreme Court’s ruling in Affiliated Ute Citizens of Utah v. United States, as well as both Ninth Circuit and other federal circuit court rulings.

  • August 06, 2021

    Investor Claims Against Cancer Drug Maker Survive Dismissal Bid

    SAN DIEGO — A federal judge in California on Aug. 4 declined to grant a motion to dismiss filed by a pharmaceutical company and certain of its senior executives on claims that they misrepresented adverse clinical trial results for the company’s metastatic breast cancer (MBC) treatment candidate in violation of federal securities laws, ruling that the lead plaintiff in the action sufficiently pleaded falsity and scienter in bringing his claims.

  • August 06, 2021

    Scienter Allegations Against Telecomm Company Lacking, 3rd Circuit Panel Rules

    PHILADELPHIA — A federal district court did not err in dismissing shareholder claims against a multinational telecommunications company and several of its current and former executive officers because in pleading their federal securities law claims, shareholders failed to sufficiently plead scienter, a Third Circuit U.S. Court of Appeals panel ruled Aug. 5 in affirming.

  • August 06, 2021

    Stanford Investor Seeks Reversal Of Stanford Receiver Clawback Award

    NEW ORLEANS — An investor in R. Allen Stanford’s massive Ponzi scheme asked the Fifth Circuit U.S. Court of Appeals on July 22 to overturn a federal district court’s judgment granting a court-appointed receiver’s request for prejudgment interest and costs because the lower court’s judgment was not in line with the appellate court’s mandate rendering judgment for the receiver.

  • August 05, 2021

    Panel Agrees That Promissory Notes Forming Basis Of RICO Claims Were Securities

    ATLANTA — A federal judge in Florida did not err in dismissing a plaintiff’s claims brought pursuant to the Racketeer Influenced and Corrupt Organizations Act (RICO) against two men and their various companies because the promissory notes at issue in the litigation were securities under federal law, and the RICO claims were thus barred by the Private Securities Litigation Reform Act (PSLRA), an 11th Circuit U.S. Court of Appeals panel ruled Aug. 3 in affirming.

  • August 05, 2021

    Evidence Supports Denial Of Summary Judgment In Stock-Drop Suit, Investors Say

    PHILADELPHIA — Class representatives asked a federal judge in Pennsylvania on July 14 to deny a motion for summary judgment on remaining federal securities laws claims brought against a generic drug company and certain of its current and former senior executives because the evidence presented sufficiently shows not only that the defendants’ alleged representations concealing their involvement in an illegal price-fixing scheme with competitors were false but also that the defendants knew that those statements were false when they were made.

  • August 04, 2021

    Shareholder Sues To Halt Energy Company’s Acquisition By Competitor

    NEW YORK — An exploration and production company’s shareholder filed a complaint in New York federal court on Aug. 3, seeking to enjoin the company, its CEO and its board of directors from conducting a planned shareholder vote on the company’s acquisition by an industry competitor until the defendants turn over information the shareholder argues is key for investors to conduct an informed vote on the proposed plan of acquisition.

  • August 03, 2021

    Delaware Judge Dismisses Coverage Suit Over Appraisal Proceeding Following Merger

    NEW CASTLE, Del. — A Delaware judge on July 30 granted primary and excess directors and officers liability insurers’ motion to dismiss an insured’s breach of contract lawsuit seeking coverage for defense costs and pre- and post-judgment interest incurred from an appraisal proceeding filed by dissenting stockholders following a corporate merger, finding that “an appraisal action is a statutory proceeding that does not seek redress in response to any corporate act” and “even if an appraisal action does arise from or seek redress for a corporate act, that act necessarily is the merger’s effectuation, which did not occur before the Run-Off Date.”

  • August 03, 2021

    Fracking Company Officers: Shareholder Case Relies On Theory That ‘Makes No Sense’

    NEW YORK — Officers in a hydraulic fracturing company on July 29 filed a brief in New York federal court arguing that the court should dismiss a shareholder lawsuit against them related to alleged federal securities law violations because the plaintiff’s theory that the officers committed fraud in one quarter, “only to make an unprompted disclosure of the error and control deficiencies in the very next quarter, makes no sense.”

  • August 03, 2021

    Shareholders Ask Judge To Approve $33M Settlement With Generic Drug Maker

    SAN FRANCISCO — Shareholders on July 30 asked a federal judge in California to grant preliminary approval of a $33 million securities class action settlement in a lawsuit alleging that the defendants concealed the company’s involvement in an illegal generic drug price-fixing scheme with its competitors in the pharmaceutical industry.

  • August 03, 2021

    Class Certification Sought In Shareholder Suit Over COVID-19 Vaccine Statements

    PHILADELPHIA — Shareholders in a securities class action against a biotechnology company and three of its senior executives, who allegedly misrepresented the company’s development and manufacturing capabilities for its COVID-19 vaccine candidate, asked a federal judge in Pennsylvania on July 29 to certify a class of similarly situated investors and named the lead plaintiffs as class representatives.

  • August 02, 2021

    L Brands Agrees To $90M Settlement To Resolve Sexual Harassment Claims

    COLUMBUS, Ohio — The parent company of Victoria’s Secret and Bath & Body Works LLC will use $90 million in company funds to implement a series of corporate governance measures agreed upon with shareholders as part of a shareholder derivative lawsuit settlement agreement stemming from claims that certain of the company’s current and former senior executives created a toxic culture of sexual harassment toward females, damaging the company’s ability to spin off Victoria’s Secret, according to a settlement agreement filed July 30 in Ohio federal court.

  • August 02, 2021

    Pension Fund’s Exchange Act Claims Against Fitness Program Provider To Proceed

    NASHVILLE, Tenn. — A federal judge in Tennessee on July 29 denied a motion to dismiss filed by a provider of health and fitness programs to seniors and Medicare members and certain of its current and former executive officers stemming from the company’s acquisition and financial reporting after acquiring nutrition company Nutrisystem Inc., ruling that a pension fund has sufficiently pleaded the necessary elements of its federal securities law claims to survive dismissal.

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