The U.S. Court of Appeals for the First Circuit held yesterday that the U.S. securities laws apply to foreign brokers’ solicitations of securities purchases by foreign investors if the purchasers or sellers incurred...more
The Second Circuit yesterday affirmed the insider trading conviction of the principal of a potential acquiror who, in breach of a nondisclosure agreement with a potential target company, had provided a tippee with nonpublic...more
This yearly report provides a summary of some of the significant changes and developments that occurred in the past year in the hedge fund and private equity spaces, as well as certain recommended practices that investment...more
The U.S. Court of Appeals for the Second Circuit reaffirmed yesterday that the federal securities laws do not apply to “predominantly foreign” securities transactions even if those transactions might have taken place in the...more
Fed Releases Updated Frequently Asked Questions for Business and Nonprofit Facilities and Instructions for Lender Required Documentation -
On September 18, 2020, the Federal Reserve Bank of Boston (the “Boston Fed”)...more
9/28/2020
/ CARES Act ,
Coronavirus/COVID-19 ,
EBITDA ,
Eligibility ,
Federal Reserve ,
Main Street Lending Programs ,
Main Street New Loan Facility ,
Nonprofits ,
SBA ,
Small Business ,
Special Purpose Vehicles ,
Term Sheets
The Second Circuit yesterday affirmed the insider-trading conviction of a doctor who, in breach of a confidentiality agreement, had traded on nonpublic information about a drug trial in which he had been participating. The...more
The Court of Appeals for the Second Circuit held yesterday that a securities-fraud plaintiff cannot establish corporate scienter without pleading facts showing that employees who allegedly knew of underlying corporate...more
The Delaware Supreme Court ruled today that Delaware corporations can adopt charter provisions requiring that actions under the federal Securities Act of 1933 be filed in a federal court. The decision in Salzberg v....more
The U.S. District Court for the Central District of California held on January 28, 2020 that the federal securities laws apply to U.S. transactions in unlisted, unsponsored American Depositary Receipts (“ADRs”) for a foreign...more
1/31/2020
/ American Depository Receipts (ADRs) ,
Dismissals ,
Foreign Private Issuers ,
Forum Non Conveniens ,
Morrison v National Australia Bank ,
Over The Counter Derivatives (OTC) ,
Putative Class Actions ,
Remand ,
Securities Exchange Act ,
Stock Exchange ,
Supplemental Jurisdiction ,
Toshiba
The Second Circuit held earlier this week that the criminal statute proscribing securities fraud permits convictions for insider trading without proof that the provider of material, nonpublic information received a personal...more
1/2/2020
/ Breach of Duty ,
Centers for Medicare & Medicaid Services (CMS) ,
Confidential Information ,
Duty of Trust ,
Enforcement Actions ,
EU Market Abuse Regulation (EU MAR) ,
Illegal Tipping ,
Insider Trading ,
Material Nonpublic Information ,
Personal Benefit ,
Rule 10(b) ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Fraud ,
Wire Fraud
Since the Second Circuit’s 2014 decision in United States v. Newman triggered a debate about the personal benefit requirement, several bills have been introduced in Congress to define insider trading. The most recent effort...more
The Delaware Supreme Court yesterday rejected a presumption of confidentiality for documents produced pursuant to books-and-records inspection requests under § 220 of the Delaware General Corporation Law. The decision in...more
8/12/2019
/ Books & Records ,
Confidentiality Agreements ,
Corporate Counsel ,
Corporate Governance ,
DE Supreme Court ,
Derivative Suit ,
Document Productions ,
Inspection Rights ,
Material Nonpublic Information ,
Section 220 Request ,
Shareholder Litigation
One of the more intriguing rulings of this Supreme Court Term is the Court’s one-sentence order yesterday dismissing as improvidently granted the writ of certiorari issued in Emulex Corp. v. Varjabedian (No. 18-459). The...more
4/25/2019
/ Emulex Corp. v Varjabedian ,
Implied Right of Action ,
Mergers ,
Negligent Misrepresentation ,
Private Right of Action ,
Proxy Solicitations ,
Rule 10(b) ,
Rule 10b-5 ,
Scienter ,
SCOTUS ,
Securities Exchange Act ,
Securities Fraud ,
Tender Offers
The Supreme Court held today that persons who do not “make” material misstatements or omissions, but who disseminate them to potential investors with fraudulent intent, can be held to have violated other provisions of the...more
4/1/2019
/ Appeals ,
Enforcement Actions ,
False Statements ,
Fines ,
Intent to Defraud ,
Investment Banks ,
Lorenzo v SEC ,
Material Dissemination ,
Misleading Statements ,
Reaffirmation ,
Rule 10b-5 ,
SCOTUS ,
Securities and Exchange Commission (SEC) ,
Securities Violations ,
Suspensions
The Court of Appeals for the Second Circuit yesterday affirmed the dismissal of a securities class action alleging misrepresentations arising from generalized statements about an issuer’s compliance efforts and Code of...more
The Delaware Supreme Court held yesterday that a corporation can be required to produce emails and other electronic documents where necessary to satisfy a shareholder’s legitimate request to inspect corporate books and...more
The Court of Appeals for the Tenth Circuit held today that the Securities and Exchange Commission may bring an enforcement action based on allegedly foreign securities transactions involving non-U.S. residents if sufficient...more
1/25/2019
/ Dodd-Frank ,
Enforcement Actions ,
Extraterritoriality Rules ,
Foreign Investment ,
Jurisdiction ,
Morrison v National Australia Bank ,
Ponzi Scheme ,
Securities and Exchange Commission (SEC) ,
Securities Exchange Act ,
Securities Violations ,
Subject Matter Jurisdiction
A lot of ink has been spilled over the crime of insider trading, which – in the view of U.S. District Judge Jed Rakoff – “is a straightforward concept that some courts have managed to complicate.” In his recent decision in...more
12/12/2018
/ Breach of Duty ,
Confidential Information ,
Criminal Prosecution ,
Dirks v SEC ,
Illegal Tipping ,
Insider Trading ,
Personal Benefit ,
SCOTUS ,
Securities Violations ,
Tippees ,
Tippers ,
US v Newman ,
US v Salman ,
White Collar Crimes
Chapter 2:
Insider Trading: Focus on Subtle and Complex Issues -
Many hedge funds routinely face insider trading concerns as they trade equity or debt. Sometimes these issues are fairly obvious, such as where the fund...more
8/16/2018
/ Breach of Duty ,
Confidential Information ,
Dodd-Frank ,
Illegal Tipping ,
Insider Trading ,
Non-Public Information ,
Personal Benefit ,
Securities Violations ,
Tippees ,
Tippers ,
White Collar Crimes
The Amsterdam Court of Appeal has approved a €1.3 billion collective settlement of claims asserted on behalf of shareholders of the former Fortis (now Ageas). The July 13, 2018 decision again shows that the Dutch Act on...more
The Second Circuit confirmed this week that a "meaningfully close personal relationship" is not required for insider-trading liability where a tipper discloses inside information as a gift with the intent to benefit the...more
6/29/2018
/ Confidential Information ,
Criminal Prosecution ,
Dirks v SEC ,
Financial Markets ,
Illegal Tipping ,
Insider Trading ,
Martoma ,
Non-Public Information ,
Personal Benefit ,
Quid Pro Quo ,
Securities Litigation ,
Securities Violations ,
Tippees ,
Tippers ,
US v Newman ,
US v Salman ,
White Collar Crimes
The Supreme Court ruled today that, when a foreign government presents a formal submission to a federal court about the content of the government’s own laws, the court should accord “respectful consideration” to the...more
6/14/2018
/ Amicus Briefs ,
Animal Science Products Inc v Hebei Welcome Pharmaceutical Co Ltd ,
Antitrust Litigation ,
China ,
Class Certification ,
Comity ,
Corporate Counsel ,
Foreign Governments ,
Price-Fixing ,
Res Judicata ,
Reversal ,
SCOTUS
The Supreme Court ruled today that judicially created principles that toll statutes of limitations for class members in timely filed class actions apply only to subsequently filed individual actions, not to follow-on class...more
6/12/2018
/ Appeals ,
China Agritech Inc v Resh ,
Class Action ,
Class Certification ,
Class Members ,
Equitable Tolling ,
FRCP 23 ,
Putative Class Actions ,
Reversal ,
SCOTUS ,
Securities Fraud ,
Statute of Limitations ,
Subsequent Litigation
The Supreme Court ruled today that the 1998 amendments to the federal securities laws did not strip state courts of jurisdiction over class actions alleging violations of only the Securities Act of 1933. The Court further...more
The Fourth Circuit ruled yesterday that a plaintiff can sufficiently plead loss causation to establish a securities-fraud claim based on an “amalgam” of two theories: corrective disclosure, and materialization of a concealed...more
2/27/2018
/ Disclosure Requirements ,
False Claims Act (FCA) ,
Form 8-K ,
Healthcare Fraud ,
Internal Investigations ,
Loss Causation ,
Material Misrepresentation ,
Qui Tam ,
Securities and Exchange Commission (SEC) ,
Securities Fraud ,
Subpoenas