False Statements

News & Analysis as of

Medtronic Settles Federal Lawsuit for $4.41 Million

On April 2, 2015, the United States Department of Justice announced that Medtronic, a medical device manufacturer based in Ireland, reached a settlement agreement with the United States government for $4.41 million over...more

Omnicare: Section 11 Liability and Opinions

The Supreme Court defined the circumstances under which liability can be imposed for opinion statements under Securities Act Section 11. Specifically, the Court held that such liability could be imposed on two theories: One...more

BofA’s Inconsistent Positions

Bank of America recently moved to dismiss a lawsuit filed by Ambac Assurance Corp. in New York state court, alleging $600 million in damages for fraudulent inducement in connection with payments it made under policies...more

POM Wonderful Inc. v. FTC: Lessons Learned

On January 30, 2015, the United States Court of Appeals for the District of Columbia issued an opinion in a case regarding the Federal Trade Commission’s (FTC) challenge to the advertisements of POM Wonderful’s (“POM”)...more

Add Importers to Those Facing Expanding Whistleblower Claims under the False Claims Act

On February 12, 2015, the Department of Justice (DOJ) announced that three U.S.-based importers had agreed to pay more than $3 million to resolve a lawsuit brought by the United States under the False Claims Act (FCA)...more

Adviser’s Principal Banned for False Statements of Eligibility, Failure to Maintain Records and Compliance Manual

A February SEC enforcement case provided a reminder to investment advisers of the importance of meticulous compliance with requirements regarding record retention and compliance manuals. In the orderi, the SEC settled an...more

CFOs Ordered to Return Bonus and Profits Due to False Financial Statements

The Securities and Exchange Commission recently ordered two former CFOs of Saba Software, Inc. to reimburse the company for stock-sale profits and bonuses accrued during the 12-month periods following its materially false and...more

Roadmap to Prison: Lessons Learned from the Criminal Prosecution of Alpha Ambulance’s Leaders

No one running an ambulance company ever planned to go to prison for doing his or her job. But that is a real possibility if the government knocks on the door, and the owner or manager is dishonest in his or her response to...more

Minnesota Staffing Company Fined $227,000 For I-9 Violations

A Minnesota-based staffing firm was recently ordered to pay a $227,000 fine for violations of the Immigration and Nationality Act, including false attestations made on I-9 forms. ...more

Where are you hiding Brian Williams?

Brian Williams has every major news outlet — and Saturday Night Live comedian — discussing journalistic integrity because of false statements he made regarding his experiences reporting in Iraq in 2003....more

New York AG May Face A Tough Road In High Frequency Trading Case Against Barclays

Ruling on Barclays’ motion to dismiss the action brought by the New York Attorney General regarding Barclays’ alternative trading system (“ATS”), Justice Shirley Kornreich suggested that the AG may face substantial hurdles in...more

Fraudulent Procurement Claim Dismissed: No Evidence Trademark Attorney Knew Statement Was False

It is not easy to cancel a federal trademark by way of a fraud claim. Investment services firm Navigator Investments (“NI”) found this out recently when the Rhode Island district court dismissed its fraudulent procurement...more

Fifth Circuit Clarifies Rules on Seamen Who Provide False Information During Pre-Employment Physicals

The U. S. Fifth Circuit recently held that an injured seaman was precluded from recovering maintenance and cure where he intentionally provided false information during a pre-employment physical conducted by a previous...more

Second Circuit Clarifies that Allegations of Direct Fraudulent Representations Are Not Necessary for Market Manipulation Claims...

In Fezzani v. Bear, Stearns & Co., Inc., No. 14-3983, 2015 WL 400547 (2d Cir. Jan. 30, 2015) (“Fezzani II”), the United States Court of Appeals for the Second Circuit clarified its opinion in Fezzani v. Bear, Stearns & Co.,...more

Australia's Federal Court Mandates Greater Care When Offering Discounts on Energy Usage Charges

The Federal Court of Australia has found that AGL South Australia Pty Ltd (AGL) made false or misleading representations and engaged in misleading or deceptive conduct, concerning the level of discount that residential...more

Of Broken Leases and ‘Broken Windows’

On Dec. 3, 2014, the Division of Enforcement of the U.S. Securities and Exchange Commission brought an enforcement action against two former top executives of Assisted Living Concepts LLC, a large provider of senior living...more

SEC Secures Federal Judge Order Against Mayor Based on Control Person Liability

On January 28, 2015, the United States District Court for the Eastern District of Michigan entered a final judgment against Gary Burtka, the former mayor of Allen Park, Michigan, upholding the Security and Exchange Commission...more

District Court Holds Plaintiff and Plaintiff's Attorneys Jointly and Severally Liable for Attorney's Fees and Costs After Finding...

After trial, HTC Corporation and HTC America, Inc. ("HTC") filed a motion seeking to recover attorney fees and costs from plaintiff's attorneys as well as from plaintiff Intellect Wireless, Inc. ("IW"). IW withdrew its...more

SEC Charges Attorney For Allegedly False Legal Opinion

Last week, the Securities and Exchange Commission announced charges against an attorney who was allegedly involved in the filing of false registration statements.  The SEC’s order instituting proceedings alleges that the...more

Overclaiming in Trademark Applications: “Full Line of …”

In Ferring B.V. v. Fera Pharmaceuticals, LLC, the Eastern District of New York was called upon to determine the importance of the United States Patent and Trademark Office’s Trademark Manual of Examining Procedure (“TMEP”)...more

This Week In Securities Litigation

FCPA enforcement was the focus this first week of the new year. The DOJ brought FCPA and Travel Act charges against an individual alleged to have repeatedly bribed an official of the European Bank of Reconstruction and...more

When Scientific Research Becomes False Advertising

Positive results of scientific research on a company’s products can provide a tempting topic for advertising and promotion. If an article published in a well-established, peer-reviewed journal says that your company’s...more

A Compilation of Enforcement and Non-Enforcement Actions

SEC Looks to Step Up Oversight of the Fund Industry - At a recent conference, Mary Jo White, SEC chairman, announced that the SEC will look to increase its scrutiny of the mutual fund asset management segment to ensure...more

SEC Charges Company Executives With Issuing False Press Releases to Inflate Stock Price

The Securities and Exchange Commission recently charged two executives at a penny stock company with issuing false and misleading press releases while secretly selling thousands of their own stock shares into the market. The...more

Corporate and Financial Weekly Digest - Volume IX, Issue 47

In this issue: - SEC Sets October 2015 Target Date for Certain Dodd-Frank and JOBS Act Rulemaking - FINRA Issues Notice on TRACE Trade Reporting Obligations - NFA Issues Guidance on Exempt and Excluded...more

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