In an opinion issued today, Judge Sweet dismissed the securities fraud claims of hedge fund SRM Global against Bear Stearns, its auditors and former executives. The suit dated back to the collapse of the mortgage-backed securities market and “near-collapse” of Bear Stearns itself in 2008. Judge Sweet ruled that the suit was time-barred. SRM had opted out of a class action that made substantially similar allegations and settled in 2012. SRM filed the instant suit on April 24, 2013, which was more than 5 years after alleged fraud was revealed in March 2008. As Judge Sweet explained, while the statute of limitations for securities fraud (which is 2 years) may be stayed during the pendency of a class action, the statute of repose (which is 5 years) was not. As the Second Circuit recently held in Police & Fire Ret. Sys. of Detroit v. IndyMac MBS, Inc.:
Continue Reading Bear Stearns Wins Dismissal of Hedge Fund’s Securities Fraud Suit

In an opinion filed last week but just posted to the ECF docket this morning, Judge Sweet denied the motion of Facebook and its underwriter banks to dismiss federal securities claims arising from the May 2012 Facebook IPO.  Noting specifically that the complaint does not allege securities fraud, Judge Sweet permitted the class action complaint of violations of other sections of the securities laws to go forward.
Continue Reading Judge Sweet Denies Facebook’s Motion to Dismiss Federal Securities Claims

In a decision last week, Judge Sweet ruled that the self-regulatory organization (“SRO”) immunity applied to bar some of the claims brought against the NASDAQ stock exchange in the consolidated In re Facebook IPO litigation.  Judge Sweet’s opinion in essence divided the claims between those that preceded the IPO and those that occurred during and after the IPO, holding the SRO immunity did not shield the NASDAQ for pre-IPO-based claims.
Continue Reading Judge Sweet Dismisses Some, but Not All, Claims Against NASDAQ in Facebook IPO Suit