Tag Archives: Securities

Judge Stein Concludes Security “Holders” Cannot Bring Fraud Claims Under New York Law, Dismisses Case Against Citi

In an opinion today, Judge Stein dismissed a case accusing Citibank of fraud and negligent misrepresentation for understating its exposure to mortgage-backed securities.  He dismissed the case because the plaintiffs were “holders” of the stock during the relevant time period (i.e., they did not buy at inflated prices and sell at a loss), and relied … Continue Reading

Judge Forrest Denies Certification in Securities Class Action Against Deutsche Bank

Judge Forrest, in an opinion today, denied class certification in a case accusing Deutsche Bank of misleading public statements concerning its exposure to mortgage-backed securities. The opinion was driven by Judge Forrest’s decision to disqualify the plaintiffs’ expert, Michael Marek, who testified that Deutsche Bank’s global registered shares (“GRSs”) traded on an efficient market.  She … Continue Reading

Judge Scheindlin Rules Auditors Can Be Strictly Liable for False “Opinions” in Registration Statements

In an opinion dated yesterday, Judge Scheindlin denied a motion to dismiss from two auditing firms, Ernst & Young and PriceWaterhouseCoopers, in a securities class action.  The auditors had issued “opinions” certifying the financial statements of a now bankrupt securities issuer (OSG), and argued that, under the Second Circuit’s recent decision in Fait v. Regions … Continue Reading

Judge Swain Dismisses Securities Act Claims Against PwC, Citing Recent “Subjective Falsity” Standard From Second Circuit

Judge Swain yesterday granted a motion for judgment on the pleadings in favor of PricewaterhouseCoopers and certain other defendants with respect to certain Securities Act claims in a class action relating to AIG’s subprime exposure.   The complaint alleged that certain accounting statements in offering documents were false, but expressly disclaimed that they were fraudulently made … Continue Reading

Judge Rakoff Grants JP Morgan Near Complete Win in Dexia MBS Suit Where Plaintiffs Did Not Read Offering Documents

Judge Rakoff yesterday issued one of his short “bottom line” Orders — with full opinion to follow — granting JP Morgan near complete summary judgment in a case in which the European bank Dexia and its former subsidiary accused Bear Stearns (later acquired by JP Morgan) of failing to comply with its stated underwriting guidelines … Continue Reading

Judge Forrest Allows Claim Against JP Morgan For Failing to Sell Lehman Notes to Proceed, And Indicates Case Will Move Swiftly

In a decision yesterday, Judge Forrest denied a motion to dismiss a proposed class action challenging JP Morgan’s decision to hold onto certain notes from Lehman Brothers as the firm was collapsing. Judge Jones, before leaving the bench, had dismissed an earlier version of the complaint as based on conclusory “hindsight” (see our prior post … Continue Reading

Judge Marrero Certifies Class Action Against Madoff Feeder Fund

Judge Marerro yesterday certified a class against the Fairfield Greenwich feeder funds that invested with Bernard Madoff.  He rejected the argument that individual reliance questions precluded class certification:  “[E]ven assuming Defendants’ claims that certain communications to class members may not have been uniform, they allegedly were uniformly misleading.” The defendants also argued that class certification … Continue Reading

Judge Sullivan Grants Einhorn’s PI, Blocking Apple Shareholder Vote

Today, Judge Sullivan granted Greenlight’s motion to preliminarily enjoin the Apple shareholder vote on “Proposal Number No. 2.”  That proposal sought to amend Apple’s Articles of Incorporation to make four changes, including to eliminate Apple’s “blank check” authority to issue preferred stock.  Prior posts on the cases are here.… Continue Reading

UPDATE: Apple Opposes Greenlight PI Motion

Today, Apple responded to Greenlight Capital’s motion for preliminary injunction blocking a shareholder vote on a plan which Greenlight claimed would eliminate Apple’s ability to issue preferred stock.   Greenlight had argued that the plan was “bundled” with other proposed amendments to Apple’s articles of incorporation (as “Proposal No. 2”)  for a single up or … Continue Reading