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On September 12, 2024, the United States Court of Appeals for the Eighth Circuit reversed a trial court decision that had rejected a bank’s assertion of the in pari delicto defense to aiding and abetting claims brought by the...more
A group of investors alleged causes of action, including breach of fiduciary duty and respondeat superior, against the broker-dealer for its failure to supervise four of its employees who operated a Ponzi scheme out of the...more
On March 23, 2023, the U.S. Bankruptcy Court for the Southern District of Florida partially denied summary judgment to Deutsche Bank on, among others, claims for aiding and abetting conversion and breach of fiduciary duty,...more
Notable litigation filed during February 2023 includes: (1) Tell v. Modica Microindustries, Inc. and (2) Pelham v. VBit Technologies Corp., et al....more
On December 15, 2022, the U.S. Court of Appeals for the Fifth Circuit reversed the pleading-stage dismissal, as time-barred, of a case against Bank of New York Mellon by defrauded investors in the Allen Stanford Ponzi scheme....more
On May 27, 2022, Plaintiff Melanie E. Damian, in her capacity as the Court-Appointed Receiver for Today’s Growth Consultant, Inc. d/b/a The Income Store (“TGC”) (the “Receiver”) filed a complaint against Defendant...more
In Rotstain v. Trustmark Nat’l Bank, plaintiffs sued banks for assisting Stanford and his entities regarding a Ponzi scheme. No. 3:09-CV-2384-N, 2022 U.S. Dist. LEXIS 10332 (N.D. Tex. January 20, 2022). ...more
IN THIS ISSUE - Eleventh Circuit Overturns Dismissal of Cryptocurrency Ponzi Scheme Class Action Suit; Federal Court of Appeals Dismisses Leading Fannie Mae and Freddie Mac Shareholder Lawsuits; NY Seeks Blockchain...more
Tu Le et al. v. Prestige Community Credit Union, filed in the United States District Court for the Central District of California on February 18, 2022, is the second putative class action filed in connection with a...more
DeCoster v. One Seven d/b/a We Are One Seven, J Wellington Financial, LLC, and Jason Jodway was filed in the Circuit Court for the County of Macomb, Michigan on January 28, 2022, seeking damages and equitable relief along...more
Christian Fiene and Erik Kiser v. Matthew Schweinzger was filed in the Northern District of Illinois on October 27, 2021, seeking damages of more than $500,000 for state statutory and common law claims related to the...more
Sedlar-Sholty, et al. v. Acclivity West, LLC, et al. was filed in the Superior Court of the State of California, County of Los Angeles on July 19, 2021 seeking damages for negligence, breach of fiduciary duty, and negligent...more
The collapse of a Ponzi scheme usually follows a familiar pattern. When the scheme is exposed, the company created by the schemer—which is usually little more than a sham entity—is placed into receivership or declares...more
In March, the Securities and Exchange Commission (SEC)’s Division of Examinations announced its 2021 examination priorities. The SEC has committed to focusing its investigations on, among other issues, “attendant risks...more
This quarter’s issue includes summaries and associated court opinions of selected cases principally decided between November 2020 and January 2021. Derivative Litigation - Second Circuit Reverses Summary Judgment...more
Ninth Circuit Holds Loss Causation May Be Predicated on Information Potentially Available Under Freedom of Information Act; D.C. Circuit Upholds FINRA’s Permanent Ban of Broker Accused of Misconduct After Finding SCOTUS...more
In Hampton v. Equity Trust Co., an individual sold fraudulent investments to the plaintiff. No. 03-19-00401-CV, 2020 Tex. App. LEXIS 5674 (Tex. App.—Austin July 23, 2020, no pet.)....more
National Bank Trust v Ilya Yurov & Ors [2020] EWHC 100 (Comm) provides a useful insight to the English Court's approach to pleading and evidencing fraud, emphasising the importance of properly particularised claims and...more
In a 2-1 opinion dated July 22, 2019, the Fifth Circuit held that third parties who paid a receiver to settle estate claims against them are entitled to an order barring other creditors from suing the settling third parties...more
We’ve focused a lot on third-party releases lately, as bankruptcy courts across the country continue to evaluate whether and under what circumstances they are permissible. But, as a recent opinion of the United States Court...more
On March 14, 2018, the Honourable Justice Penny of the Ontario Superior Court (Commercial List Division) released a decision granting a US$2.6-billion judgment to the SFC Litigation Trust for fraud and breach of fiduciary...more
The SEC filed one new action this week – an administrative proceeding involving the principal of an investment adviser and undisclosed conflicts of interest. The Commission also amended a complaint in an insider trading...more
The morning news reports flashes a report that your customer was actually a Ponzi scheme and defrauded numerous people. Of course, this is terrible news for the innocent victims, but, you ask yourself, could my bank be...more