The Second Circuit yesterday affirmed an April 2014 decision by Judge Pauley (covered here) rejecting claims that American Express, Citi and Discover colluded to add arbitration clauses barring class actions to their standard card agreements.  Judge Pauley had previously ruled that the defendants had acted individually, and not collusively, when adding class action waivers

In an opinion yesterday, Judge Pauley harshly criticized the SEC for obtaining an ex parte freeze on the assets of a Cayman bank premised on the bank’s participation in a pump-and-dump scheme for unregistered securities.  The SEC should have known or quickly discovered, according to Judge Pauley, that the bank was acting as a broker

In an order yesterday, Judge Pauley rejected the joint request of the Consumer Financial Protection Bureau and Sprint to move forward on court approval of a $50 million settlement of the regulator’s investigation into the telecom company.  The parties had submitted a proposed one-sentence joint motion for approval of a final judgment and settlement, and

In an opinion today, the Second Circuit reversed a decision by Judge Pauley (see our prior posts on the case here), and ruled that the NSA’s bulk collection of phone data is unlawful. Section 215 of the Patriot Act allows the government to collect “tangible things” that are “relevant” to an “authorized investigation” of terrorism, but the Second Circuit found that bulk collection did not meet the test of relevance:
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In an opinion issued today, Judge Pauley lamented the “troubling trend toward prolixity in pleading [that] is infecting court dockets in this district and elsewhere.”  Pointing to the 175-paragraph complaint, “larded with more than 1,400 pages of exhibits” and the 303-page, 1,263-paragraph counterclaim in a “relatively straightforward” case, Judge Pauley admonished both sides for their failure to adhere to Rule 8’s exhortation that a pleading contain a “short and plain statement of the claim.”
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In opinion today reducing the attorney’s fees awarded to class counsel in an FLSA case, Judge Pauley criticized the plaintiffs’ attorneys for supporting their fees by citing “caselaw” suggesting that one-third of the recovery is an appropriate amount, when those cases were really signed orders drafted by counsel in other cases:
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A complaint filed yesterday is the second SDNY suit (see our post on the first one, here) to argue that SEC ALJ’s are too insulated from accountability to the executive branch, in violation of Article II of the Constitution. The underlying case involves administrative charges against Jordan Peixoto, who allegedly shorted Herbalife stock in advance of a presentation by the hedge fund Pershing Square accusing Herbalife of being a pyramid scheme. Peixoto allegedly received the information from a friend (Filip Szymik) who was roommates with an analyst at Pershing Square. Peixoto argues that the case was brought administratively to avoid having a jury rule on weak evidence and on a novel application of the insider trading laws:
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