Mealey's Securities
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April 26, 2024
Investor Tells High Court 9th Circuit Erred In Finding He Lacked Standing To Appeal
WASHINGTON, D.C. — In a petition for a writ of certiorari, an investor asks the U.S. Supreme Court to consider whether he had standing to bring an appeal in a securities putative class complaint he initially brought against a digital health care company after a retirement fund was named lead plaintiff, arguing that the Ninth Circuit U.S. Court of Appeals incorrectly found that he lacked standing.
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April 26, 2024
Settlement Of Securities Claims Against Pharmaceutical Company Preliminarily OK’d
CAMDEN, N.J. — A federal magistrate judge in New Jersey granted preliminary approval to a $97 million settlement in a case brought against a pharmaceutical company and certain of its executives by shareholders accusing the company of artificially inflating stock value to stave off a buyout.
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April 26, 2024
Amici Tell 5th Circuit SEC Approval Of Nasdaq Rule Was Unconstitutional
NEW ORLEANS — Neary half of the U.S. states comprise one of five groups to submit an amicus curiae brief in the Fifth Circuit U.S. Court of Appeals in support of two petitioners who question whether the Securities and Exchange Commission had 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.
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April 25, 2024
SEC Files 2nd Appeal Of Finding It Can’t Call Voting Advice ‘Solicitation’
WASHINGTON, D.C. — The Securities and Exchange Commission appealed to the District of Columbia Circuit U.S. Court of Appeals a federal judge’s ruling that the SEC acted in excess of its authority when it issued rule changes redefining proxy voting advice as a type of “solicitation,” days after an advocacy group that acted as an intervener filed an appeal of its own.
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April 25, 2024
Settlement Of Shareholder Derivative Claims Against EV Maker Gets Final Approval
DENVER — A federal judge in Colorado granted final approval to a settlement in a shareholder derivative complaint filed by an investor who claimed that an electric vehicle manufacturer made misleading claims about its ability to scale up production following a merger, finding the settlement that includes a $1.85 million payout to be used for other legal defenses to be fair and adequate.
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April 25, 2024
Lead Plaintiffs Selected For Securities Complaint Over Boeing’s Safety Record
ALEXANDRIA, Va. — A federal judge in Virginia appointed a retirement system and a pension fund to serve as lead plaintiffs in a putative class complaint originally filed by the retirement system on behalf of investors of the Boeing Co. alleging that the company and certain of its executives made misleading statements about the safety of the company’s 737 MAX airplane.
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April 23, 2024
Propriety Of $100 Stability AI Stock Sale At Issue In Delaware Briefing
WILMINGTON, Del. — A man who claims that he was duped into selling what are now millions of dollars’ worth of Stability AI Inc. shares for $100 tells a Delaware court that he reasonably relied on statements that the company was worthless. But the defendants say in their motion to dismiss that the man had his own reasons for selling the stock and that he hopes to receive a windfall based on a case of buyer’s remorse.
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April 23, 2024
9th Circuit Finds Investors Didn’t Show Falsity Of Claims From Intel
SAN FRANCISCO — In a four-page opinion, a Ninth Circuit U.S. Court of Appeals panel affirmed a California federal judge’s dismissal of a putative class complaint brought by investors against computer chip manufacturer Intel Corp. and certain of its executives, finding that the investors failed to show that the company knowingly issued false statements about the timeline of a new product’s launch.
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April 22, 2024
9th Circuit: Investor Failed To Show Company’s Scienter For False Statements
SAN FRANCISCO — A panel of the Ninth Circuit U.S. Court of Appeals on April 19 affirmed a California federal judge’s dismissal of a putative class complaint brought by an investor of an informational services company, finding that the investor failed to show that the company and certain of its executives knowingly issued misleading statements about company activities and how the alleged false statements caused a loss.
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April 19, 2024
9th Circuit Affirms Dismissal Of Investors’ Suit Against Gaming Company
SAN FRANCISCO — A panel of the Ninth Circuit U.S. Court of Appeals affirmed a California federal judge’s decision to dismiss a putative class complaint brought by investors against a gaming company and certain of its officers, agreeing that the investors did not show that the company misled investors through false statements about the technical aspects of its mobile gaming platform.
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April 19, 2024
Jury Finds SEC Showed Man Used Info From Employer For Insider Trades
SAN FRANCISCO — A federal jury in California found a man liable after the Securities and Exchange Commission accused him of using confidential information about the acquisition of his employer to buy stock options in a different company.
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April 19, 2024
SEC Settles With 1 Of 2 Former Execs It Said Faked Records
NEW YORK — In separate orders, a New York federal judge issued final judgment against one of two former executives the Securities and Exchange Commission accused of falsifying their former employer’s public investor materials after she settled with the commission and scheduled a settlement conference with the other former executive, against whom the judge previously entered summary judgment.
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April 19, 2024
SEC Tells Supreme Court Cross-Appeal Rule Not Triggered By Disgorgement Remand
WASHINGTON, D.C. — The Second Circuit U.S. Court of Appeals correctly remanded the Securities and Exchange Commission’s enforcement action against a venture capitalist for re-calculation of disgorgement after amendments to the Securities Exchange Act of 1934, the SEC tells the U.S. Supreme Court, saying a cross-appeal requirement was not triggered.
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April 18, 2024
Court: Positive Outlook Doesn’t Outweigh Disclosures In Asbestos Securities Class
NEW YORK — Even while putting a positive spin on Garrett Motion Inc.’s future, the company repeatedly warned investors about the dire financial situation posed by the asbestos-related liabilities it acquired in its spinoff from Honeywell International Inc., and the company was unlikely to believe it could mislead the market given the public nature of its information, the Second Circuit U.S. Court of Appeals said April 17 in affirming dismissal of a securities class action.
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April 18, 2024
SEC: Media Company, CEO Misled Investors About Relationships With Other Entities
NEW YORK — In an April 17 complaint filed in a New York federal court, the Securities and Exchange Commission says that a media group and its chairman and chief executive officer engaged in a multimillion dollar fraud by issuing false statements that the media group developed sports content for two telecommunications companies, despite not being poised to launch any content with either company.
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April 18, 2024
Netflix: Investors’ Suit Does Not Show Company Misled About Password Sharing
OAKLAND, Calif. — Streaming company Netflix Inc. and certain of its executives moved to dismiss with prejudice a putative class complaint brought by investors in a California federal court alleging the company made material misrepresentations about how it was affected by users sharing passwords, saying the investors did nothing to rectify the issues that led to an earlier version of their complaint being dismissed.
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April 17, 2024
SEC Again Seeks Dismissal Of Enforcement Action After Judge’s Sanctions
SALT LAKE CITY — The Securities and Exchange Commission again moved to dismiss its own case against several groups it accused of using a cryptocurrency scheme to defraud investors out of at least $49 million, saying it will allow the commission more time to determine whether to refile the case after a federal judge in Utah imposed sanctions on it for using false information when applying for a temporary restraining order (TRO).
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April 17, 2024
Advocacy Group Appeals Finding That SEC Can’t Call Voting Advice ‘Solicitation’
WASHINGTON, D.C. — An advocacy group that acted as an intervener defendant on April 16 appealed to the District of Columbia Circuit U.S. Court of Appeals a federal judge’s ruling that the Securities and Exchange Commission acted in excess of its authority when it issued rule changes redefining proxy voting advice as a type of “solicitation.”
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April 17, 2024
Federal Judge: SEC Shows Municipal Advisers Violated Multiple Rules
ROCHESTER, N.Y. — A federal judge in New York granted a motion for partial summary judgment from the Securities and Exchange Commission, finding that a municipal advisory company and certain of its executives did not disclose potential conflicts of interest in contracts with municipal entities.
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April 16, 2024
Federal Judge Rules SEC Showed Municipal Adviser Failed To Disclose Material Info
SAN DIEGO — A federal judge in California on April 15 issued a mixed order on a motion for partial summary judgment by the Securities and Exchange Commission, finding that the SEC adequately showed that a municipal advisory company and its co-founder withheld material information from municipal bond clients about the co-founder’s former employer but that there is a triable issue over whether the co-founder disclosed a fee-splitting agreement with his former employer to the clients.
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April 16, 2024
Delaware High Court Partly Revives Investor Claims Against Dating Site Companies
WILMINGTON, Del. — The Delaware Supreme Court partially reversed a decision from the state’s Court of Chancery in a putative class case brought by shareholders questioning the fairness of a technology company’s spinoff from a controlled subsidiary, finding that the investors adequately alleged that one member of a separation committee lacked independence from the tech company.
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April 15, 2024
Judge Partly Grants Insurer’s Motion To Compel In D&O Coverage Dispute Over Merger
WILMINGTON, Del. — A Delaware judge on April 12 granted in part and denied in part a directors and officers liability insurer’s motion to compel discovery in a coverage dispute over claims that directors, officers and controlling shareholders breached their fiduciary duties in connection with the 2019 merger of Viacom and CBS Corp.
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April 15, 2024
SEC: Attorney, Developer Entities Misused Investor Cash For Unrelated Projects
LAS VEGAS — In a complaint filed in a Nevada federal court, the Securities and Exchange Commission says an attorney and three entities she managed defrauded foreign investors by selling securities to fund the construction of skilled nursing facilities in the Las Vegas area before using the funds for unrelated purposes.
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April 15, 2024
Federal Judge Finds Broker’s Client’s Claims Precluded By SLUSA
NEW YORK — A federal judge in New York dismissed a putative class complaint brought against an investment company and certain of its employees by a client who said the company failed to disclose that a team heading a new investment program was involved in arbitration with the team members’ former employer, finding that the client’s claims are barred by the Securities Litigation Uniform Standards Act (SLUSA).
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April 12, 2024
Supreme Court Finds Pure Omissions Not Actionable Under SEC Rule
WASHINGTON, D.C. — A unanimous U.S. Supreme Court held April 12 that a private securities action cannot be brought on the basis of an omission on filings with the Securities and Exchange Commission if the omission does not render other statements misleading, finding that pure omissions are not actionable under SEC Rule 10b-5.