The Financial Industry Regulatory Authority (“FINRA”) is the largest independent, non-governmental regulator of broker-dealer firms doing business in the United States. See UBS Fin. Servs., Inc. v. W. Va. Univ. Hosps., Inc. , 660 F.3d 643, 648 (2d Cir. 2011). FINRA was formed in 2007, pursuant to Section 15A of the Securities Exchange Act of 1934 (“Exchange Act”), through the merger of the National Association of Securities Dealers (“NASD”) and the New York Stock Exchange Re

Since the summer of 2016, this Blog has written about the Fiduciary Rule (the “Fiduciary Rule” or the “Rule”), which the Department of Labor (“DOL”) promulgated in April 2016. ( See , e.g. , here , here , here , here , here , here , here .) Readers of this Blog know that the implementation of the Rule has not gone smoothly. The Rule has been the subject of congressional and industry attacks and legal challenges. On March 15, 2018, one of the legal challenges succeeded – the C

According to a new report by Cornerstone Research (“Cornerstone”), titled Securities Class Action Settlements—2017 Review and Analysis (the “Report”) ( here ), total settlement dollars from securities class action lawsuits declined “dramatically” in 2017, even as the number of settlements remained relatively steady. Cornerstone’s March 14, 2018 press release about the Report can be found here . In 2017, the total value of court-approved securities class action settlements

“Timing is everything”, it is often said. A fine illustration of this often-uttered phrase can be found in Reverend C.T. Walker Housing Dev. Fund Corp. v. City of New York (E.D.N.Y. March 5, 2018), an appeal from the United States Bankruptcy Court for the Eastern District of New York. The Reverend C.T. Walker Housing Dev. Fund Corp. (“Walker”) owned property on 135 th Street in New York City (the “Property”). The New York City Department of Housing Preservation and Devel

Recently, Credit Suisse (the "Bank"), the multinational financial services holding company based in Switzerland, was hit with two class action lawsuits , one from investors over the Bank's writedown of more than $1 billion and the other from U.S.-based brokers who refused or were unable to move to Wells Fargo & Co. ("Wells Fargo") after their private banking unit was closed in 2015 . Both lawsuits come at a time when the Bank has been in the news for legal challenges and i

Ameriprise Settles with The SEC for Overcharging Retirement Account Customers for Mutual Fund Shares On February 28, 2018, just a few weeks after launching its Share Class Selection Disclosure Initiative (discussed below), the Securities and Exchange Commission (“SEC”) announced (here) that Ameriprise Financial Services Inc. (“Ameriprise”), the Minnesota-based broker-dealer and investment adviser, agreed to settle charges for recommending and selling higher-fee mutual fund sh

On February 23, 2018, the U.S. Supreme Court set oral argument in Lucia v. SEC, 17-130, a case involving the use of administrative law judges (“ALJ”) by the Securities and Exchange Commission (“SEC” or the “Commission”) as hearing officers in administrative proceedings. The issue presented to the Court concerns whether the use of ALJs violates the constitutional limitations of the Appointments Clause on “Officers of the United States” (here). U.S. Const., art. II, § 2, cl. 2

The parties in Stravroulakis v. Pelakanos , 58 Misc.3d 1221(A) (Sup. Ct. N.Y. Co. Feb. 13, 2018), are the owners of Bareburger. The majority owners attempted to oust a shareholder by improper means and the court thought otherwise. The oversimplified facts of Stravroulakis are as follows. Plaintiff and some of his buddies (the “Owners”) owned a dive bar in Brooklyn called Sputnik, in which they started to sell organic hamburgers. The hamburgers became so popular that the

Since the summer of 2015, the Delaware Chancery Court has issued a series of rulings in which disclosure-only settlements in merger objection lawsuits have been rejected. Those rulings culminated with the decision by Chancellor Andre Bouchard in January 2016, in which he confirmed that parties submitting disclosure-only settlements to Chancery Court judges should expect enhanced scrutiny of such settlements. In In Re Trulia, Inc. Stockholder Litigation , 129 A.3d 884 (Del. C

On February 21, 2018, the United States Supreme Court ruled that the anti-retaliation protections passed by Congress after the 2008 financial crisis extend only to individuals who report suspected violations of the securities laws to the Securities and Exchange Commission (“SEC” or “Commission”). In Digital Realty Trust, Inc. v. Somers , 583 U.S. _____ (2018) ( here ), the Court held that individuals who blow the whistle through internal means only are precluded from the anti

In Dormitory Authority of the State of New York v. Samson Construction Co. (Feb. 15, 2018) , the New York Court of Appeals was called on to address, inter alia, the question of whether the City of New York “is an intended third-party beneficiary of the architectural services contract between…Dormitory Authority of the State of New York (DASNY) and…Perkins Eastman Architects, P.C. (Perkins)….” The facts of Dormitory are relatively simple and typical of many construction proje

Through the years, numerous class action lawsuits have been brought involving securities fraud, corporate misconduct, unfair business practices and other claims. This article provides a brief overview of class action lawsuits . What is a class action lawsuit? A class action is a procedural device in which one or more persons sue on behalf of a larger group of persons, referred to as the “class.” The class action lawsuit started in the courts of equity in seventeenth-century

The New York Court of Appeals rules that a litigant must produce information from her Facebook account notwithstanding her chosen “privacy” settings. The plaintiff in Forman v. Henkin (February 13, 2018) was injured after falling from a horse owned by defendant and alleges she suffered “spinal and traumatic brain injuries resulting in cognitive deficits, memory loss, difficulties with written and oral communication, and social isolation.” During the litigation, plaintiff r

Last November, this Blog wrote about an announcement Michael D. Granston (“Granston”), Director of the DOJ Commercial Litigation Branch, Fraud Section, made at a health care conference concerning the DOJ’s intention to seek dismissal of meritless qui tam cases. ( Here .) Since the speech was not accompanied by a policy memorandum, there was skepticism within the False Claims Act (“FCA”) bar that there would be any material change in policy. That skepticism was met last month

Directors and officers of publicly traded companies have a fiduciary duty to their shareholders. In the face of corporate misconduct, executives are often reluctant to take legal action against their peers. However, shareholders may bring a derivative lawsuit against the board of directors and other responsible parties. The goal is to compel the board to remedy the damages sustained by company and to protect the interests of investors. Nonetheless, a successful claim depends

On January 31, 2018, the Second Department decided 159 MP Corp. v. Redbridge Bedford, LLC. The Court in 159 MP , recognized that the “appeal raises an issue of first impression in the appellate courts of New York…” to the extent that it “address the question of whether written leases negotiated at arm’s length by commercial tenants may include a waiver of the right to declarative relief that is enforceable at law or, alternatively, whether such a waiver is void and unenfor

Why Corporate Governance Matters Today, it is essential for directors and officers of public companies to have an understanding of corporate governance. Essentially, this involves adhering to state and federal rules and regulations, meeting fiduciary obligations and establishing and implementing internal controls. Ultimately, an attorney with experience in internal investigations and corporate governance can provide guidance on these critical responsibilities. Sarbanes-Oxley

Alternative dispute resolution (“ADR”) has been gaining momentum as an alternative to litigation over the past decade. Most major corporations insist on it, in one form or another, in every contract they execute. ADR can take on many forms, including negotiation, mediation and arbitration. All ADR methods have pros and cons that should be considered before making them a part of a company’s legal process. Independent Negotiation This is the least formal ADR tactic available an