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SEC Settles Insider Trading Suit Over Pharma Deal

Thursday, Sep 02, 2010

A former hedge fund manager and an executive with a New Jersey-based pharmaceutical company, both facing insider trading charges tied to AstraZeneca’s acquisition of MedImmune Inc. in 2007, have agreed to settle a U.S. Securities and Exchange Commission case against them.

SEC Orders Muni Advisers To Register By Oct. 1

Thursday, Sep 02, 2010

The U.S. Securities and Exchange Commission on Thursday announced the adoption of a rule requiring municipal financial advisers to register with the agency by Oct. 1, a tight deadline established by the recently enacted financial reform legislation.

Madoff Victims Decry Bid For $35M In Attys' Fees

Thursday, Sep 02, 2010

Investors with notorious Ponzi schemer Bernard L. Madoff are rising up in protest against bankruptcy trustee Irving J. Picard and his firm Baker & Hostetler LLP's latest fee requests, saying the combined $34.6 million sought is out of the question.

SEC Ends Probe Of KB Home Accounting, Disclosures

Thursday, Sep 02, 2010

The U.S. Securities and Exchange Commission has completed an investigation into KB Home Inc.'s accounting and disclosures and does not plan to recommend any enforcement actions, the company said Wednesday.

Pitcairn Enters Ch. 11 To Fend Off Investor Takeover

Thursday, Sep 02, 2010

Real estate developer and property manager Pitcairn Properties Holdings Inc. has sought Chapter 11 protection in an effort to ward off investor Eric Blum, who controls the company's preferred stock and is seeking to gain control of its board of directors.

Ex-VeraSun Execs Cleared In Shareholder Suit

Thursday, Sep 02, 2010

A federal judge found that former executives at the defunct ethanol firm VeraSun Energy Corp. gave sufficient warning of the risk the company faced prior to its implosion to stop a lawsuit brought by its investors.

SEC Probes 'Quote Stuffing' For Link To Market Crash

Thursday, Sep 02, 2010

The U.S. Securities and Exchange Commission is reportedly examining a Wall Street practice called “quote stuffing” and whether it helped fuel the May “flash crash” — when the Dow Jones Industrial Average plummeted 700 points in just minutes.

Porsche Says Morrison Ruling Blocks Hedge Fund Suit

Thursday, Sep 02, 2010

German automaker Porsche Automobil Holding SE says a recent U.S. Supreme Court ruling blocks a lawsuit by hedge fund investors seeking to recoup more than $2 billion in losses stemming from Porsche's failed 2008 bid to take over Volkswagen AG.

Firm To Investigate 3G's $4B Deal For Burger King

Thursday, Sep 02, 2010

3G Capital Management LLC's $4 billion deal to acquire fast food titan Burger King's parent company sparked controversy as soon as it was announced Thursday, with New York securities law firm Tripp Levy PLLC announcing an investigation for possible breach of fiduciary duty.

Shareholder Seeks To Block $943M 3M, Cogent Deal

Wednesday, Sep 01, 2010

A Cogent Inc. shareholder filed a putative class action Wednesday in Delaware Chancery Court seeking to block 3M Co.’s proposed $943 million bid to buy the biometrics firm.

5th Circ. Sides With JPMorgan In Dispute Over Merger

Wednesday, Sep 01, 2010

A federal appeals court has shot down a bid from a putative class of former First Commerce Corp. debenture holders who claimed they were entitled to a cash settlement from JPMorgan Chase & Co. equal to the $40 million the financial services giant paid to end a shareholder securities action over the merger of First Commerce and Banc One Corp.

Texas Man Cops To $485M Oil, Gas Ponzi Scheme

Wednesday, Sep 01, 2010

The co-founder of Provident Royalties LLC has pled guilty to conspiracy in connection with a $485 million scheme to defraud 7,700 investors, in the first case to be prosecuted against an individual involved with the defunct Texas energy investment firm.

Suit Over Deloitte Audit Of Adelphia Statements Nixed

Wednesday, Sep 01, 2010

The federal judge overseeing multidistrict litigation over the alleged artificial inflation of Adelphia Communications Corp.'s securities has tossed a member suit accusing independent auditor Deloitte & Touche LLP of issuing a misleading report on the now-bankrupt cable provider's financial health.

Skilled Healthcare Settles Securities Action For $3M

Wednesday, Sep 01, 2010

Skilled Healthcare Group Inc. has reached a $3 million settlement with investors over steep losses incurred when the company was forced to restate earnings because it had overstated reserves set aside to cover unpaid patient bills.

SEC Accuses Halek, CBO Of $22M Oil Scheme

Wednesday, Sep 01, 2010

The U.S. Securities and Exchange Commission has accused Halek Energy LLC and CBO Energy Inc. of bilking investors out of $22 million through an unregistered securities offering of stakes in several Texas oil and gas projects.

Merrill, BofA Stock Not Needed To Bring Suit, Court Says

Tuesday, Aug 31, 2010

Former shareholders of Merrill Lynch & Co. Inc. did not have to hold stock in both Merrill and its buyer Bank of America Corp. to bring a so-called double-derivative suit, the Delaware Supreme Court has ruled, weighing in on a question certified by a federal judge.

Cert. Denied In First American Appraisal Collusion Suit

Tuesday, Aug 31, 2010

A federal judge has denied class certification to shareholders in a suit alleging title insurer First American Financial Corp. and its unit eAppraiseIT LLC colluded with Washington Mutual Inc. to manipulate real estate appraisals.

SEC Decides Not To Hit Moody's With Ratings Action

Tuesday, Aug 31, 2010

Because of a jurisdictional uncertainty, the U.S. Securities and Exchange Commission will not pursue an enforcement action against credit rating agency Moody's Corp. over allegedly boosted ratings, the agency said Tuesday.

KPMG Settles Accounting Fraud Class Action

Tuesday, Aug 31, 2010

A federal judge has given her initial stamp of approval to a $1.75 million settlement of a consolidated class action brought by former Allou Healthcare Inc. shareholders who accused auditors KPMG LLP and Arthur Andersen LLP of failing to discover accounting fraud at the bankrupt pharmacy products provider.

Ex-Pfizer Worker Loses Bid To Revive ERISA Dispute

Tuesday, Aug 31, 2010

A federal appeals court has rejected a former Pfizer Inc. employee's claim that the company violated its fiduciary duties under a retirement plan by giving her incorrect information about how early retirement would affect her stock options.


Expert Analysis

South Beach — Death And Taxes Assured

In re South Beach Securities Inc. represents the first time any of the federal circuit courts of appeal have weighed in on section 1129(d) of the Bankruptcy Code. More specifically, it addresses whether the U.S. Trustee has standing to raise an objection to confirmation based upon the provision; and under what circumstances the "principal purpose" of a Chapter 11 plan will be deemed tax avoidance, says Mark G. Douglas of Jones Day.

5 Cases Impacting Investors In Public Cos.

Recently, there have been reported a number of local cases that may not have drawn the attention of readers from outside the New York metropolitan area. Five come from New York state or federal courts, and the fourth is a stone’s throw away in Delaware. Each opinion deals with important and repeated issues in the securities area directly impacting investors in public corporations, says Fred T. Isquith of Wolf Haldenstein Adler Freeman & Herz LLP.

Shareholder Democracy: Public Cos.' Brave New World

The U.S. Securities and Exchange Commission has adopted major changes to proxy rules that will facilitate shareholders' exercise of their rights under state law to nominate and elect directors to public company boards of directors. This action represents a major flip-flop from the SEC’s position just two years ago when it chose to preserve a company’s prerogative to exclude shareholder proposals to nominate directors, says Joris M. Hogan of Torys LLP.

Can You Google Or Facebook Potential Jury Members?

Lawyers should avoid online interactions with members of the venire — even interactions that are ostensibly anonymous (because it is the interaction that creates the ethical problem, not whether he might get caught) — and instruct their colleagues, consultants, staff and other affiliates to do the same, say Eric A. Paine and Amanda S. Kitts of Nelson Mullins Riley & Scarborough LLP.

The Legal Market In Transition

Getting a law degree is no longer the default safety net it once may have been, even though incoming students do not yet seem to understand that. Some large firm partners have expressed the view that law firms in fact subsidize law schools, says Kate Neville of Neville Career Consulting LLC.

Rejecting The 'Fraud Created The Market' Theory

Given that there is a clear, established split among the circuits between those that have adopted the fraud-created-the-market theory and those that have rejected it, this issue might well be taken up by the U.S. Supreme Court, say Stanley Yorsz and John H. Korns of Buchanan Ingersoll & Rooney PC.

Sweat The Small Stuff — Nanotech Insurance Issues

No lawsuits have yet been filed relating to environmental, health or safety effects relating to nanomaterials. Nonetheless, the associated risks create the potential for mass tort litigation involving bodily injury, property damage, financial loss and third-party liability, says Ethan V. Torrey of Choate Hall & Stewart LLP.

Heightening Scrutiny Of Repurchase Agreements

While many press accounts regarding the U.S. Securities and Exchange Commission's focus on "repos" have centered on banks and other financial institutions, the SEC’s most recent public pronouncements make clear it is expanding its efforts to examine all “large and financially significant companies,” regardless of their industry, say Perrie M. Weiner and Patrick O. Hunnius of DLA Piper.