In an opinion today, Judge Furman upheld GM’s decision to withhold, on privilege and work product grounds, interview notes underlying a publicly-released report prepared by GM’s attorneys at Jenner & Block regarding GM’s recall of around 800,000 vehicles that may have had defective ignition switches. The plaintiffs argued (among other things) that the interviews were not done for the “primary purpose” of  providing legal advice, but were instead conducted “to identify and correct the problems that resulted in the delayed recalls and to address a public relations fiasco by reassuring investors and the public that it takes safety seriously.”  Judge Furman disagreed:

Continue Reading Judge Furman Allows GM to Withhold Jenner & Block Interview Notes Underlying Public Report on Ignition Switch Issues

In an opinion yesterday, Judge Nathan remanded to state court a dispute among lenders to the Stuy Town residential development because it did not arise under federal law.  The plaintiffs are junior lenders who allege that certain senior lenders improperly foreclosed, but the senior lenders claim that there was no excess value for the junior lenders.  The dispute as to whether there was excess value or not turns (at least in part) on how a federal post-judgment interest statute, 28 U.S.C. § 1961, applies to the 2010 federal judgment giving rise to the foreclosure. Judge Nathan ruled that the role of § 1961 in the case was not sufficient for federal jurisdiction because it related only to damages, was not essential to any cause of action:

Continue Reading Judge Nathan Remands Stuy Town Lender Dispute Because Federal Questions Related Only to Computation of Damages

Yesterday Judge Forrest granted summary judgment in a contract dispute involving the highly litigious Genger family.  The opinion begins:

Continue Reading Judge Forrest: Latest in Litigious Family Saga Is Really a “Simple Breach of Contract Case”

In an opinion today, Judge Oetken ruled that Sprint was collaterally estopped from revisiting an arbitration ruling in Kansas concluding that, under Kansas’s Unfair Trade and Consumer Protection Act (“KCPA”), a customer named Vincent Emilio was allowed to bring his claims against Sprint as a class action. In the underlying dispute, Emilio alleges it was unlawful for Sprint to pass along to its customers a fee to cover a New York state tax. Sprint argued that its agreements with customers bar class actions, and that, while the KCPA prohibits these types of class waivers, the KCPA was applicable only to conduct “within this state” (i.e., Kansas), not to issues relating to a New York tax. Judge Oetken ruled, however, that Sprint bargained for the arbitrator to make this decision, and already lost on the point:

Continue Reading Judge Oetken: Sprint Can’t Re-litigate Arbitral Ruling Allowing Customer Class Action

In a 135-page opinion issued Thursday, but made public for the first time Friday in redacted form, Judge Sweet granted the New York Attorney General’s motion to enjoin drug maker Activis from dropping a twice-a-day Alzheimer’s drug called Namenda IR, whose patent protection is about to expire, in favor of a once-a-day version called Namenda XR. The switch was allegedly motivated to prevent triggering state laws requiring pharmacists to substitute generics that are “AB-rated” to the brand name drug — i.e., have the same active ingredient, “form, dosage, strength, and safety and efficacy profile.”  These laws can cause a sharp decline in revenue when a patent expires (referred to as the “patent cliff”). As Judge Sweet explained, companies may try to avoid the “patent cliff” through a practice called “product hopping”:

Continue Reading Judge Sweet Blocks Activis From “Product Hopping” Alzheimer’s Drug To Avoid Triggering Laws Requiring Substitution of Generics

In an opinion today, Judge Kaplan denied the motion of CDO manager Harding Advisory and its principal Wing Chau to preliminarily enjoin SEC administrative proceedings against them.  The hearing has already been completed, but they await a decision that is expected next month.  As we reported in March, the plaintiffs initially moved to stay the proceedings before they even began (see our prior post here), but that motion was denied. Harding and Mr. Chau’s basic allegation is that administrative proceedings are so lacking in procedural protections that they violate due process, especially as compared to federal court.  Judge Kaplan concluded, however, that they could make those arguments within the administrative process itself – i.e., through an appeal to the Commission and then to the Second Circuit.  The cumbersome nature of that route, Judge Kaplan ruled, does not deny the plaintiffs due process:

Continue Reading Judge Kaplan Denies Motion Challenging SEC Administrative Proceedings As Unfair

In an Order yesterday, Magistrate Judge Ellis blocked the deposition of music mogul Jay Z (Shawn Carter) in a copyright case relating to the logo for Jay Z’s record label, Roc-A-Fella.  However, the price to be paid for sparing him from the deposition was that Jay Z would not be allowed to testify at trial:

It is clear that, no matter how “important” or busy, all people are amenable to the Federal Rules of Civil Procedure. Anyone with knowledge of relevant facts in a case may be deposed. Carter has provided an affidavit that says he does not recall nor have any knowledge of the facts alleged in the Complaint . . . . [A] sworn affidavit in which an affiant denies knowledge or recollection of relevant facts is, for evidentiary purposes, the equivalent of a deposition during which a deponent makes identical denials . . . . [A] witness who swears before trial that he has no personal knowledge of relevant facts may not avoid discovery by later claiming “sudden recollection” and testifying at trial.

Our prior post on the case is here.

From the government’s press release summarizing the complaint:

Deutsche Bank acquired a corporation in the fall of 1999 that held stock with a very low cost-basis, such that the sale of this stock would trigger more than $100 million in taxable gain as a result of the appreciation in value of the stock. In order to avoid paying taxes on the stock’s built-in gain, Deutsche Bank entered into an arrangement with a firm that created three shell companies . . . [that] collectively served as an underfunded special-purpose vehicle with no function other than to be stuck with a tax bill that it could never pay.

The case is before Judge Kaplan

In an opinion today, Judge Cote granted Tory Burch summary judgment in a case concerning knock-off merchandise.  The motion was deemed unopposed based the defendants’ misconduct, including spoliation and fabrication of evidence.  In a particularly notable passage, the opinion discloses that the Court ordered a forensic examination of the defendants’ opposition papers, and, from that examination, determined that those papers were served too late:

Continue Reading Judge Cote Employs Forensic Examination to Determine Brief Was Served Too Late

In an opinion last week, Judge Scheindlin denied the plaintiffs in a securities class action leave to amend their complaint to assert securities fraud claims against the company’s auditors, PriceWaterhouseCoopers and Ernst & Young. The proposed amendment would have alleged that PwC and E&Y took at face value the erroneous opinion of a third party tax preparer (referred to as “Frankel”), which the plaintiffs argued is as reckless and fraudulent as simply taking management representations as true:

Continue Reading Judge Scheindlin: Auditors’ Failure to Investigate Tax Preparer’s Opinions is Not Fraud