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Mealey's Securities

  • January 17, 2025

    Investment Adviser Sues Insurers For Breach Of Contract In Delaware Court

    WILMINGTON, Del. — An investment adviser insured sued its investment management liability insurers for breach of contract in a Delaware court, seeking a declaration that the insurers have a duty to advance defense costs and indemnify it against underlying claims for unjust enrichment, breach of fiduciary duty and violations of the Securities Exchange Act of 1934.

  • January 16, 2025

    DOL Issues Long-Awaited ‘Adequate Consideration’ Proposed Regulation For ESOPs

    WASHINGTON, D.C. — The U.S. Department of Labor (DOL) on Jan. 16 released a long-awaited revised proposed regulation and a proposed class exemption on an Employee Retirement Income Security Act of 1974 issue that has seen significant litigation — employee stock ownership plan (ESOP) transactions.

  • January 15, 2025

    Judge Orders Distribution Of Funds In $15 Million Zillow Securities Settlement

    SEATTLE — A federal judge in Washington ordered the distribution of a $15 million class action settlement in a case brought by investors against online real estate marketplace provider Zillow Group Inc. alleging that the provider concealed the development of a co-marketing program that violated the Real Estate Settlement Procedures Act (RESPA) and encouraged such violations in violation of federal securities laws.

  • January 14, 2025

    High Court Denies Petition For Certiorari In Domestic Transaction Standards Case

    WASHINGTON, D.C. — The U.S. Supreme Court on Jan. 13 denied a petition for certiorari brought by an online platform where crypto assets could be purchased and sold, leaving in place a Second Circuit U.S. Circuit Court of Appeals ruling that securities claims may proceed over crypto asset purchases in light of plausible allegations that the transactions in question matched on servers located in the United States.

  • January 14, 2025

    Solicitor General Invited To Weigh In On ICA Private Right Of Action Case

    WASHINGTON, D.C. — The U.S. Supreme Court on Jan. 13 invited the solicitor general to file a brief expressing the views of the United States in a case brought by multiple closed-end funds (CEFs) asking the high court to decide whether a section of the Investment Company Act of 1940 (ICA) includes a private right of action.

  • January 09, 2025

    Federal Judge Grants Final Approval Of $15.25 Million Securities Settlement

    GREENSBORO, N.C. — A medical device and pharmaceutical company and its shareholders received final approval of a settlement by a federal judge in North Carolina, ending a case brought by the shareholders, who alleged that they sustained financial losses based on false or misleading statements about securities offered by the company.

  • January 09, 2025

    Final Approval Granted To U.S. Portion Of Fracking Securities Global Settlement

    BROOKLYN, N.Y. — A federal judge in New York granted final approval to the approximately $7 million U.S. portion of a global settlement in a case brought by investors alleging that an oil and gas exploration company violated securities laws.

  • January 08, 2025

    Biopharmaceutical Company, Insurer Stipulate To Dismiss D&O Coverage Dispute

    LOS ANGELES — After announcing that a settlement has been reached in principle, a biopharmaceutical company insured and its insurer filed a joint stipulation to dismiss a directors and officers liability coverage dispute arising from a lawsuit brought by the insured’s former employee.

  • January 07, 2025

    2nd Circuit Affirms Amount, Scope Of Asset Freeze In Securities Fraud Action

    NEW YORK — In a summary order, a Second Circuit U.S. Court of Appeals panel affirmed a district court order granting a preliminary injunction and asset freeze of $46 million against the owner of a company the Securities and Exchange Commission alleges misappropriated investor funds and hindered the commission’s investigation into the company, finding that the lower court had correctly determined the amount and scope of the asset freeze.

  • January 07, 2025

    Delaware Judge Rules On Summary Judgment Motions In D&O Coverage Dispute

    WILMINGTON, Del. — A Delaware judge held that an underlying securities class action falls under a 2018-2019 directors and officers liability insurance policy period but that an underlying consumer class action falls outside both the 2017-2018 and 2018-2019 policy periods and is not interrelated with any covered claims, ruling on various motions for summary judgment brought by a health technology business and its primary and excess insurers.

  • January 07, 2025

    Federal Magistrate Judge OKs $17.75 Million Settlement In Securities Dispute

    OAKLAND, Calif. — A federal magistrate judge in California issued an order granting final approval to a $17.75 million settlement in a case brought by investors who alleged that a company provided several misleading omissions and misrepresentations in a proxy registration statement to secure a merger with a special purpose acquisition company.

  • January 06, 2025

    Judge: Bump-Up Exclusion Does Not Bar D&O Coverage For Securities Class Action

    WILMINGTON, Del. — A Delaware judge on Jan. 3 ruled in favor of an insured in its breach of contract and declaratory judgment lawsuit seeking directors and officers coverage for an underlying securities class action, rejecting the insurers’ argument that the policy’s bump-up exclusion barred coverage.

  • January 06, 2025

    Split 9th Circuit Panel Determines Investor Not Defrauded By Undisclosed Lawsuit

    SAN FRANCISCO — A split panel of the Ninth Circuit U.S. Court of Appeals agreed with a federal district court that a cryptocurrency investor did not sufficiently allege federal and state securities fraud claims when he accused the seller of the cryptocurrency of misleading investors by not informing them of a lawsuit the seller filed against the cryptocurrency company’s parent company.

  • January 06, 2025

    9th Circuit Holds Equity Shares Aren’t ‘Goods’ Under Lanham Act

    SAN FRANCISCO — A partly split Ninth Circuit U.S. Court of Appeals panel affirmed a California federal judge’s dismissal of an American legal services website company’s trademark infringement suit against a similarly named Japanese legal software company beginning to sell equity shares to American investors, holding that selling equity does not meet the Lanham Act’s criteria of the sales of goods and services.

  • January 03, 2025

    SEC Granted Final Judgment Against Trader Who Defrauded Clients For Years

    AUSTIN, Texas — After a federal magistrate judge agreed with the Securities and Exchange Commission that an options trader had operated a stock options trading scheme, a federal judge in Texas issued an order granting final judgment on the SEC’s behalf,  agreeing with the magistrate judge that the options trader had violated antifraud provisions of federal securities laws.

  • January 03, 2025

    Investors In Snapchat Creator Adequately Pleaded Scienter, 9th Circuit Panel Says

    SAN FRANCISCO — A panel of the Ninth Circuit U.S. Court of Appeals reversed a district court’s decision to dismiss a class action complaint against the company that created Snapchat, finding that the investors had adequately alleged scienter by bringing allegations that the company had misled investors when discussing the impact of advertising changes at Apple Inc. to its revenue.

  • January 02, 2025

    Funds File Reply Asking U.S. High Court To Rule On ICA Private Right Of Action

    WASHINGTON, DC — In a reply brief supporting their petition for a writ of certiorari, multiple closed-end funds (CEFs) ask the U.S. Supreme Court to decide whether a section of the Investment Company Act of 1940 (ICA) includes a private right of action, arguing that the circuits are split on the issue and countering a hedge fund’s argument in opposition that the high court should let the issue percolate further.

  • December 30, 2024

    Exchange Act’s Antifraud Provisions Applied In Suit Against Former Brazilian Exec

    NEW YORK — Ruling that a July 2010 amendment to the Securities Exchange Act of 1934 (Exchange Act) means that the act’s “antifraud provisions apply to extraterritorial conduct that is the subject of an enforcement action” by the U.S. Securities and Exchange Commission, a New York federal judge denied a motion to dismiss an enforcement action against the former senior executive of a Brazilian reinsurance company.

  • December 23, 2024

    2nd Circuit Affirms Dismissal Of Kodak Shareholder Derivative Action

    NEW YORK — The dismissal of a shareholder derivative action alleging that a company’s officers and directors enriched themselves at the company’s expense when they conducted a series of stock transactions was upheld by the Second Circuit U.S. Court of Appeals, with the panel finding that the plaintiff shareholders had waived their challenge to the lower court’s factual findings in the case.

  • December 20, 2024

    Federal Judge Finds Hedge Fund Failed To Establish Trade Secrets Claims

    BIRMINGHAM, Ala. — A federal judge in Alabama found that a startup hedge fund failed to establish that the company it hired to help fix its computer code designed to help process stock market data and beat the stock market had wrongfully appropriated and publicized the computer code, granting summary judgment to the defendant company.

  • December 20, 2024

    Delaware Supreme Court Affirms Stockholder Damages After CEO Fast-Tracked Merger

    WILMINGTON, Del. — Sitting en banc, the Delaware Supreme Court affirmed a portion of a lower court’s determination that a company’s founder and CEO breached his fiduciary duty to the company’s stockholders when he fast-tracked a merger with a private equity firm, finding that the company’s former stockholders sufficiently pleaded that the CEO “tilted” the process in favor of the firm rather than pursue a deal that was in the stockholders’ best interest.

  • December 20, 2024

    Split 9th Circuit: Arbitrator Ruling Can Preclude Relitigation Of SOX Issues

    PASADENA, Calif. — While a ruling by an arbitrator can’t preclude a Sarbanes-Oxley Act of 2002 (SOX) claim, it can “preclude relitigation of issues underlying such a claim,” a divided Ninth Circuit U.S. Court of Appeals panel ruled, affirming dismissal of a whistleblower retaliation claim.

  • December 18, 2024

    Split 5th Circuit Determines SEC Not Authorized To Approve Disclosure Rule

    NEW ORLEANS — Sitting en banc, a split Fifth Circuit U.S. Court of Appeals found that the Securities and Exchange Commission did not have the right to approve a rule implemented by Nasdaq Stock Market LLC that requires companies listed on the exchange to publicly disclose information about the race and gender identity of their board members, agreeing with two petitioners who argued that the SEC did not show that it had the authority to approve the rule.

  • December 16, 2024

    2nd Circuit: Minority Shareholders Lacked Evidence To Support Claims

    NEW YORK— A panel of the Second Circuit U.S. Court of Appeals in an unpublished opinion found that former minority shareholders of a mining company failed to offer admissible evidence adequate to support their securities and racketeering claims against the former majority shareholder of the mining company and the former majority shareholder’s co-managers, affirming a district court’s grant of summary judgment in the former majority shareholder’s favor.

  • December 16, 2024

    Investors Failed To Show IPO Statements Were Misleading, 3rd Circuit Finds

    PHILADELPHIA — A panel of the Third Circuit U.S. Court of Appeals affirmed dismissal of an investor’s securities fraud class action against a medical device manufacturer, agreeing with the trial court that the investor failed to plead falsity and scienter as to business statements the investor found to be misleading.