Los Angeles partner Julian W. Poon is the authors of "Tenth Circuit Clarifies Loss Causation Burden" [PDF] published in the May/June 2009 issue of ABA's Business Law Today.
Client Alert | May 4, 2009
Orange County partner Wayne W. Smith and Los Angeles partner Gareth T. Evans are the authors of "Securities Litigation and the Economic Crisis: Understanding and Dealing with the Current Securities Litigation Environment" [PDF] published in 2009 by Aspatore Books.
Client Alert | May 4, 2009
New York partners Jonathan C. Dickey and Marshall R. King are the authors of "Delaware's Duty of Oversight - Directors Prevail in the Citigroup Subprime Litigation" [PDF] published in the April 2009 issue of Thomson Reuters's Securities Litigation Report.
Client Alert | April 6, 2009
Los Angeles partner Theodore J. Boutrous Jr. and Julian W. Poon are the authors of "Tenth Circuit Rules on Loss Causation" [PDF] published in the March 2009 issue of Insights.
Client Alert | March 31, 2009
New York of counsel Richard Cashman is the author of "Still Divisive-PSLRA Discovery Stay" [PDF] published online by Law360 on March 12, 2009 at law360.com.
Client Alert | March 12, 2009
In recent years, Securities and Exchange Commission ("SEC") enforcement investigations have become extended and enforcement actions have often been commenced five years or more after the events that form the basis for the claim. As a result, lawyers for persons who are involved in SEC investigations are frequently asked to sign agreements tolling the running of the statute of limitations. On February 26, 2009, the United States Court of Appeals for the Seventh Circuit issued a significant decision in Securities and Exchange Commission v. Koenig (Docket No.
Client Alert | March 5, 2009
We issued a Client Alert on February 19, 2009 on the Tenth Circuit opinion setting forth a robust analysis of the loss causation burden under the federal securities laws.
Client Alert | March 3, 2009
Washington, D.C. partner Mark A. Perry and associate Indraneel Sur are the authors of "SLUSA Precludes 'Actions,' Not Claims" [PDF] published in the March 2009 issue of Mealey's Emerging Securities Litigation.
Client Alert | March 2, 2009
On February 24, 2009 the Court of Chancery of the State of Delaware issued an important opinion dismissing all but one claim in a shareholder derivative action seeking to recover for Citigroup Inc.
Client Alert | February 27, 2009
In January, we provided you with our 2008 Year-End False Claims Act Update in which we discussed, among other things, legislation proposed in Congress in 2007 that would significantly broaden the scope of the False claims Act (the "FCA"). As we predicted, Senator Grassley (R-IA) recently introduced legislation to amend the FCA that, given the current economic environment, Congress is likely to pass. Congress may feel more pressure to pass these bills this session to demonstrate a commitment to protect taxpayer's dollars from fraud, waste, and abuse. First, on February 5, 2009, Senator Grassley introduced the Fraud Enforcement and Recovery Act, S.
Client Alert | February 26, 2009
On February 18, 2009, the United States Court of Appeals for the Tenth Circuit issued a significant decision in In re: Williams Securities Litigation--WCG Subclass (Docket Number 07-5119), that clarified the contours of a plaintiff's "loss causation" burden under federal securities laws.
Client Alert | February 19, 2009
First Steps in "Empowering" the Enforcement StaffIn her first speech as Chairman of the Securities and Exchange Commission, Mary Schapiro announced today two changes to the enforcement process at the SEC intended to "empower" the staff of the Enforcement Division. First, Chairman Schapiro announced an end to a two-year "pilot" program which had required the Enforcement staff to obtain a special set of approvals from the Commission in cases involving civil monetary penalties against public companies as a sanction for securities fraud. Second, Chairman Schapiro announced a plan to provide more rapid approval of formal orders of investigation authorizing the staff to issue subpoenas. Although these changes affect only the internal procedures of
Client Alert | February 6, 2009
Yesterday, Senators Charles Grassley (R-IA) and Carl Levin (D-MI) introduced the Hedge Fund Transparency Act ("HFTA"), which would require hedge funds, private equity and other private funds with $50 million or more in assets, or assets under management, to register with the Securities and Exchange Commission ("SEC"), notwithstanding the availability of exemptions from registration for privately offered funds under Sections 3(c)(1) and 3(c)(7) of the Investment Company Act of 1940 ("1940 Act"), as renumbered.
Client Alert | January 30, 2009
I. Hedge Fund Enforcement Update A. Introduction 1. 2008--A Watershed Year in Hedge Fund Enforcement By virtually any measure, 2008 was a watershed year on the hedge fund enforcement front. Driven by the turmoil that has reshaped our capital and credit markets, enforcement efforts soared to new heights.
Client Alert | January 9, 2009
On December 30, 2008, the Securities and Exchange Commission delivered to Congress a report, mandated by the Emergency Economic Stabilization Act, on mark-to-market accounting standards and their application to financial institutions. The report concludes that fair value accounting standards should not be suspended, but makes eight recommendations to improve their application, including additional guidance for determining fair value in inactive markets. The report finds that investors generally believe fair value accounting increases transparency and facilitates investment decision-making. The report also observes that fair value accounting did not appear to play a meaningful role in the bank failures of 2008, but rather that those failures appeared to be the result of gr
Client Alert | January 9, 2009
I. Introduction Today's headlines are riddled with allegations of fraud and fraudulent schemes--against investors, markets, homeowners, individuals, corporations, and the government.
Client Alert | January 8, 2009
New York partner Mark K. Schonfeld and Dallas associate Akita St. Clair are the authors of "A Wider Scope of Primary Liability?" [PDF] published online by Law360 on January 7, 2009 at law360.com.
Client Alert | January 7, 2009
2008 – A Dynamic Year in Corporate Deferred Prosecution AgreementsIn the post-Enron and WorldCom era, the U.S. Department of Justice ("DOJ") often uses corporate deferred prosecution agreements ("DPAs") to resolve federal criminal investigations.
Client Alert | January 6, 2009
By any measure, 2008 was a monster year in Foreign Corrupt Practices Act ("FCPA") enforcement. With thirty-three enforcement actions between the Department of Justice ("DOJ") and Securities and Exchange Commission ("SEC"), the statute's dual enforcers, 2008 was the second busiest numerical year on the books, trailing only 2007. But beyond the numbers (after all, with the massive Siemens resolution, 2008 dwarfs all other years combined in fines and disgorgement), 2008 saw the FCPA's enforcement regime mature like never before. There were no unimportant FCPA enforcement actions this year. Whether the trend was increasingly aggressive enforcement against individuals, ramped up international coordination, the joining of FCPA prosecutions wi
Client Alert | January 5, 2009
In connection with regulatory reform legislation anticipated to be introduced in the 111th Congress, consideration will be given to enacting proposals to further legislate the swaps market and, in particular, credit default swaps ("CDS") and the over-the-counter ("OTC") derivatives market.
Client Alert | December 23, 2008
Position on Waiver of Attorney-Client Privilege Follows Trend of DOJ, SEC The Financial Industry Regulatory Authority ("FINRA") has recently provided guidance on the extent to which "extraordinary cooperation" by a firm or individual in an investigation can influence FINRA's enforcement decisions. In particular, with respect to waiver of the attorney-client privilege, the guidance states that waiver or non-waiver of the privilege will not be considered in whether to grant credit for cooperation, but rather it is the assistance in "uncovering the facts in an investigation" that will yield credit for cooperation. In this respect, FINRA follows the trend recently set by the Securities and Exchange Commission and the Department of Justice. Despit
Client Alert | December 5, 2008
Over the past year, turmoil in the financial markets has led to increased litigation, and the high-profile failures of several major financial institutions have focused attention on the protections that are available for directors and officers of public companies. Fortunately, it is still rare for directors and officers to contribute personally to the settlement of a lawsuit. However, more than ever before, strong indemnification protections and comprehensive insurance for directors and officers ("D&O insurance") are vital to a company's ability to attract and retain qualified directors and officers. This client alert discusses several recent developments in the areas of director and officer indemnification and D&O insurance and then concludes by offerin
Client Alert | December 3, 2008
New York partner Jonathan Dickey is the author of "Auditor Liability "Caps" - The Politics of Catastrophe" [PDF] published in the November 2008 issue of West Legalworks's Securities Litigation Report.
Client Alert | November 3, 2008
New York partner Jennifer Rearden and associate J. Taylor McConkie are the authors of "Trends in Subprime-Related Securities Fraud Actions" [PDF] published online by Law360 on October 31, 2008 at law360.com.
Client Alert | October 31, 2008
On October 23, 2008, the United States Court of Appeals for the Second Circuit issued a published and precedential decision in Morrison v. National Australia Bank (Docket Number 07-0583-cv), which left open the door for applications of the anti-fraud provisions of American securities laws in so-called "Foreign-Cubed" securities cases--that is, cases brought by foreign plaintiffs, against a foreign company, arising out of a foreign securities transaction. Although the Court declined to exercise jurisdiction because of the particular facts of the National Australia Bank case, the Court also declined to adopt a bright-line rule barring jurisdiction in all such cases. Facts and Procedural Posture of National Australia BankNational Australia Bank ("NAB") is Austr
Client Alert | October 29, 2008
The SEC's Division of Enforcement issued its first-ever manual this week. Intended as a reference for Enforcement Division staff, the Manual provides important insight into SEC decision-making and processes on such key matters as evaluating possible investigations, opening and closing matters, issuing Wells letters, communicating with senior SEC officials, responding to document subpoenas, "witness assurance" letters, contacting current and former employees, and respecting the attorney-client privilege during an investigation. It will be an essential guide for anyone with a matter before the Division of Enforcement.
Client Alert | October 10, 2008
On Friday, September 19, 2008, the Securities and Exchange Commission announced a "sweeping expansion" of its ongoing investigation of possible manipulation of the price of equity securities of financial institutions, to determine whether certain market participants engaged in illegal activity to enhance the value of short positions. SEC Chairman Christopher Cox stated that the investigation will look into the activity of investors with significant short positions in equity markets and positions in credit default swaps. This expansion, according to Chairman Cox, supplements ongoing SEC investigations concerning the origination and securitization of sub prime mortgage loans, the involvement of credit rating agencies and insurers in the securitization proce
Client Alert | September 24, 2008
In a speech delivered by Deputy Attorney General Mark Filip to the New York Stock Exchange on August 28, 2008, the Department of Justice announced sweeping changes to the factors federal prosecutors may consider in determining whether to bring criminal charges against business organizations.
Client Alert | September 2, 2008
Faced with continuing Congressional interest in legislation aimed at preventing federal prosecutors and other enforcement attorneys from seeking privileged information, the Justice Department has announced that it will again revise its policy regarding the investigation and prosecution of business organizations. The DOJ's proposals will restrict the ability of federal prosecutors to seek privileged information from companies, and will have an immediate impact on the ways in which businesses cooperate with government investigations. The current Principles of Federal Prosecution of Business Organizations, outlined in the "McNulty Memo," have been the focus of Congressional and public criticism, and Pennsylvania Senator Arlen Specter has spear-headed legislation ai
Client Alert | July 11, 2008
The frenetic pace of Foreign Corrupt Practices Act ("FCPA") enforcement set in 2007 has carried through the first half of 2008. Mid-year prosecutions are up – substantially so – from last year's record-setting totals. And corporate disclosures and media reports of ongoing investigations evidence that this trend of continually increasing enforcement is here to stay for the near future. This client update provides an overview of the FCPA and other foreign bribery enforcement activities during the first half of 2008, a discussion of the trends we see from that activity, and practical guidance to help companies avoid or limit liability under these laws. A collection of Gibson Dunn's publications on the FCPA, including prior enforcement updates and more in-
Client Alert | July 7, 2008
On April 4, 2008, the United States Court of Appeals for the Ninth Circuit reversed the much-discussed Oregon federal court decision, United States v. Stringer, which had dismissed a criminal indictment due to the government's violation of the defendant's due process rights resulting from "egregious" behavior in conducting a parallel civil-criminal investigation.
Client Alert | April 14, 2008
A WHITE PAPER FROM THE SUBPRIME WORKING GROUP OF GIBSON, DUNN & CRUTCHER LLPNOTE: This also appeared in the April 2008 issue [PDF] of Insights.I. INTRODUCTIONIn the last six months, numerous originators, syndicators, insurers and rating agencies involved in the purchase and sale of subprime mortage-backed securities, collateralized mortgage obligations (“CMOs”) and collateralized debt obligations (“CDOs”) have announced significant write-downs or other adverse financial impacts stemming from the ever-widening “credit crunch.” One published report states that as of early January 2008, over a hundred companies had announced writedowns totaling more than $150 billion, and eventually could approach $300 billion.[
Client Alert | April 1, 2008
The Supreme Court's decision last week in LaRue v. DeWolff, Boberg & Associates, No. 06-856, slip op. (U.S. 2008), addressed the first of several issues that have divided the courts in ERISA "stock drop" cases, which concern losses to company 401(k) plans resulting from downturns in the company's stock.The defendant employer in the case, DeWolff, maintained a 401(k) plan in which plaintiff LaRue had been a participant.
Client Alert | February 25, 2008
New York partners Jonathan C. Dickey and Aric Wu and associate Ross Wallin are authors of "2008 Securities Litigation Reform Forecast: Cloudy, Chance of Rain" [PDF] published in the February 2008 issues of Securities Litigation Report.
Client Alert | February 15, 2008
New York partner Jonathan C. Dickey, Washington, D.C. partner Mark A. Perry, and Los Angeles partner Julian W. Poon are authors of "Stoneridge Investment Partners v. Scientific-Atlanta, Inc.: The Supreme Court Rejects 'Scheme' Liability" [PDF] published in the January 2008 issue of Insights.
Client Alert | February 10, 2008
Washington, D.C. partner Mark Perry is the author of "Stoneridge and the Continued Reconceptualization of Implied Private Rights of Action" [PDF] published in the February 2008 issue of Wall Street Lawyer.
Client Alert | February 1, 2008
On January 15, 2008, the Supreme Court issued an important decision clarifying the contours of private actions under the key anti-fraud provision of the securities laws.
Client Alert | January 15, 2008
Jonathan C. Dickey is the author of "Litigation Against Accountants and Lawyers: The Year of Living Dangerously" [PDF] prepared for the West LegalWorks 17th Annual Litigation and Resolution of Complex Class Actions Workshop, November 1-2, 2007.
Client Alert | November 1, 2007
Jonathan C. Dickey is the author of "Current Trends in Federal Securities Litigation" [PDF] prepared for the Practising Law Institute Securities Litigation and Enforcement Institute 2007, October 15, 2007.
Client Alert | October 15, 2007
Washington, D.C. partner John Sturc and associate John W.F. Chesley are the co-authors of "The FCPA and Analogous Foreign Anti-Bribery Laws--Overview, Recent Developments, and Acquisition Due Diligence" [link to PDF] published in the September 24, 2007 issue of Capital Markets Law Journal.
Client Alert | September 24, 2007
In a previous client update ("UK Court of Appeal confirms that documents created by regulators are not always protected from production in court proceedings"), we discussed a recent Court of Appeal decision confirming the limitations on the statutory protections granted to documents created by the chief regulatory body in the UK, the Financial Services Authority (the FSA), in the course of its confidential investigations into regulated entities for suspected rule breaches. In particular, the Court of Appeal confirmed that such documents are not always protected from production in subsequent court proceedings, even though this will enable claimants to obtain documents that already contain the benefit of a regulatory body's analysis of facts and to obtain advance indications
Client Alert | September 19, 2007
New York Partner Lee Dunst is the author of "Private Civil Litigation: The Other Side of Stock Option Backdating" [PDF], published in the September 3, 2007 issue of the BNA Securities Regulation and Law Report.
Client Alert | September 3, 2007
The Foreign Corrupt Practices Act (“FCPA”) is 30 years old this year, and the anniversary is being “celebrated” with an explosion of enforcement activity by both the Securities and Exchange Commission (“SEC”) and the Department of Justice (“DOJ”).
Client Alert | July 26, 2007
Jonathan C. Dickey is the author of "Current Trends in Federal Securities Litigation" [PDF] prepared for the ALI-ABA Postgraduate Course in Federal Securities Law, June 28 - 29, 2007.
Client Alert | June 28, 2007
On June 21, 2007, the Supreme Court issued an 8-1 decision in Rita v. United States, No. 06-5754, affirming the ability of appellate courts to use a presumption of reasonableness where the sentences they are reviewing were imposed within the applicable range under the Federal Sentencing Guidelines.
Client Alert | June 25, 2007
On June 21, 2007, the Supreme Court issued an 8-1 decision in Tellabs v. Makor Issues & Rights, No. 06-484, explaining the plaintiff’s burden under § 21D(b)(2) of the PSLRA (15 U.S.C.
Client Alert | June 22, 2007
The Securities and Exchange Commission recently provided an important reminder of the need for effective information barriers and procedures to address potential conflicts of interest, including misuse of confidential information, that may exist given the multiple hats increasingly worn by broker-dealers, investment advisers, hedge funds, private equity funds, and other financial intermediaries.
Client Alert | June 11, 2007
Jonathan Dickey and Jeffrey Minnery are authors of "Liability Issues for Audit Firms - The Risk of Catastrophic Exposure Prompts Calls for Liability Reforms," published in the Securities Litigation Report, April 2007.
Client Alert | April 2, 2007
In a decision having important implications both for the scope of liability under the securities laws and for class certification in general, on March 19, the Fifth Circuit ruled that a securities fraud action against certain financial institutions that participated in transactions with Enron Corporation could not proceed as a class action.
Client Alert | March 22, 2007