Disclosure, Greenwashing, and the Future of ESG Litigation

By Barbara Ballan and Jason J. Czarnezki October 18, 2024 by renholding

In recent years, consumers, investors and regulators have become increasingly aware of the climate crisis and accompanying risks, leading to increased demand for transparency and accountability from corporations about their business practices and sustainability footprints. This, in turn, has led …

In Securities Fraud Class Actions, Do You Get What You Pay For?

By Stephen J. Choi, Jessica M. Erickson and A.C. Pritchard March 12, 2024 by renholding

When it comes to recovering money for shareholders injured by corporate fraud, do the plaintiffs’ lawyers matter? Intuitively, the answer seems like it must be yes. The most talented lawyers should develop more creative legal theories and uncover more evidence …

Skadden Discusses Final SEC Rules on SPACs and De-SPACs

By Andrew J. Brady, Joshua Shainess, Michael K. Hoffman, C. Michael Chitwood and Gregg. A Noel February 16, 2024 by renholding

On January 24, 2024, the Securities and Exchange Commission (SEC) adopted final rules that impose significant additional procedural and disclosure requirements on initial public offerings (IPOs) by special purpose acquisition companies (SPACs) and in business combination transactions involving SPACs (de-SPACs). …

John C. Coffee, Jr. and Joshua Mitts – Can Section 11 Be Saved?: Tracing a Path to Its Survival

By John C. Coffee, Jr. and Joshua Mitts December 6, 2023 by renholding

In the wake of Slack Techs., LLC v. Pirani,[1] many have predicted that Section 11 of the Securities Act of 1933 will decline into a state of near irrelevance. Some have mourned this prospect in the belief that …

Rethinking Cautions Accompanying Investment Predictions

By Franklin A. Gevurtz January 23, 2023 by renholding

We are constantly bombarded with warnings about dangers to our health or wellbeing. Sometimes, however, the warnings might facilitate the danger. In a new article, I show how the cautionary statements that commonly accompany predictions of corporate performance fall into …

A New Approach to Measuring Litigation Risk

By Antonis Kartapanis and Christopher G. Yust November 2, 2022 by renholding

Securities litigation is a major and costly source of corporate risk that can affect many aspects of companies’ operations. The task of identifying the causes and consequences of this risk is, however, challenging because researchers observe only companies that are …

Does the Threat of Securities Class Actions Add Value for Shareholders? Evidence from China

By Warren Bailey, Hui Ma, Rongli Yuan and Hong Zou May 18, 2022 by renholding

Securities class actions (SCA) are an important governance mechanism in the U.S. securities market, but there is a significant debate about their costs and benefits to investors. SCA are intended to serve two key functions in investor protection: disciplining and …

SEC Chair Gensler on SPACs, Shell Companies, and Projections Proposal

By Gary Gensler March 31, 2022 by renholding

Today [March 30], the Commission is considering a proposal to strengthen investor protections in special purpose acquisition companies (SPACs). I am pleased to support this proposal because, if adopted, it would strengthen disclosure, marketing standards, and gatekeeper and issuer obligations

…

Gibson Dunn Offers 2021 Mid-Year Securities Litigation Update

By Monica K. Loseman, Craig Varnen, Jefferson E. Bell, Rachel N. Jackson and Alisha Siqueira September 13, 2021 by renholding

The torrid pace of new securities class action filings over the last several years slowed a bit in the first half of 2021, a period in which there have been many notable developments in securities law. This mid-year update briefs …

Fenwick & West Discusses Mitigating Class Action Litigation Risk for SPAC Transactions

By Jay Pomerantz, Marie Bafus, David Michaels and Nicolas Dumont October 26, 2020 by Nisha Chandra

Special purpose acquisition companies (SPACs) are increasingly being used as an alternate vehicle to traditional initial public offerings. Companies that go public through a traditional IPO process are often subject to shareholder securities class actions. Inevitably, securities class actions will …

Cleary Gottlieb Discusses Why Second Circuit Should Abandon “Core Operations” Doctrine

By Jared Gerber, Kayla Rooney and Brad Lenox October 13, 2020 by renholding

In the Private Securities Litigation Reform Act of 1995, Congress imposed heightened pleading standards on securities fraud claims in order to discourage the filing of unmeritorious litigation.[1] Key among these standards are the dual requirements that a complaint “state …

Skadden Discusses Significant Ninth Circuit Ruling on Scienter in Securities Fraud

By Peter B. Morrison, Virginia Milstead, Winston P. Hsiao, Zachary Faigen and Raza Rasheed June 22, 2020 by renholding

On June 10, 2020, the Ninth Circuit affirmed the dismissal of a putative securities fraud class action in a potentially significant decision for securities defendants, particularly those in the pharmaceutical, biotech and medical device space. The Ninth Circuit in Nguyen …

Can Institutional Investors Help the Market Evaluate Complex Legal Disputes?

By Paul Borochin, Xiaoqiong Wang and Siqi Wei March 6, 2020 by renholding

Do institutional investors have the ability to mitigate information asymmetries around complex corporate events? Securities class actions (SCA) are suitable for testing any informational advantage for institutional investors: The number of SCAs brought against U.S. firms has increased markedly in …

Cleary Gottlieb Discusses Second Circuit’s High Bar for Securities Fraud Pleadings

By Carmine D. Boccuzzi, Jr., Roger Cooper and Jared Gerber December 17, 2019 by renholding

On December 10, 2019, the Second Circuit, in Gamm v. Sanderson Farms, held that when a securities fraud complaint alleges that statements were rendered false or misleading through the non-disclosure of illegal activity, the facts of the underlying wrongdoing …

“Cyan,” Reverse-“Erie,” and the PSLRA Discovery Stay in State Court

By Wendy Gerwick Couture June 14, 2019 by renholding

In the wake of the Supreme Court’s holding in Cyan, Inc. v. Beaver County Employees Retirement Fund[1] that state courts have concurrent jurisdiction over Securities Act claims, even if asserted as class actions, there has been an influx of …

The Changing Character of Securities Litigation in 2019: Why It’s Time to Draw Some Distinctions

By John C. Coffee, Jr. January 22, 2019 by renholding

Securities litigation is growing at a prodigious rate. Is that good or bad? This column will answer that we have to unpack this phenomenon and realize that very different things (with very different implications) are happening simultaneously. Let’s begin with …

How Changes in the Likelihood of Shareholder Litigation Affect M&A Decisions

By Chune Young Chung, Incheol Kim and Monika K. Rabarison February 1, 2018 by renholding

Evidence shows shareholders’ wealth is protected from self-serving managers, who are often motivated to divert corporate resources, by both internal and external corporate governance mechanisms (Jensen and Meckling, 1976; Fama, 1980; Fama and Jensen, 1983). However, due to high monitoring …

Latham & Watkins Discusses Supreme Court Hearing on State Jurisdiction Over Securities Claims

By Joshua G. Hamilton, James H. Moon and Tanya Syed December 7, 2017 by renholding

On November 28, 2017, the Supreme Court of the United States held oral argument in the highly anticipated case of Cyan, Inc. v. Beaver County Employees Retirement Fund, No. 15-1439, to decide whether the Securities Litigation Uniform Standards Act …

Confidential Distortion: Dealing with Confidential Witnesses in Securities Litigation

By John C. Coffee, Jr. September 25, 2017 by renholding

In a recent article prepared for the ABA’s National Institute on Class Actions, which is now posted on SSRN (available here), I and Professor Alexandra Lahav survey recent class action developments, and I focus particularly on the special …

How Not to Write a Class Action “Reform” Bill

By John C. Coffee, Jr. February 21, 2017 by renholding

It was predictable. Given a solidly Republican Congress and a Republican president, sooner or later, an effort would be made in the Trump administration to curb class actions. Not surprisingly, it has come sooner, with the “Fairness in Class Action …

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Columbia Law School's Blog on Corporations and the Capital Markets

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