According to a report issued jointly by the New York University Pollack Center for Law & Business and Cornerstone Research, the Securities and Exchange Commission (“SEC” or “Commission”) filed 33% fewer enforcement actions against public companies and their subsidiaries in fiscal year 2017 than in fiscal year 2016. The report ( here ), SEC Enforcement Activity: Public Companies and Subsidiaries, Fiscal Year 2017 Update (the “Report”), analyzes data from the Securities Enforc

Following months of hinting that the Department of Justice (“DOJ” or “Department”) would change its qui tam policies, Michael Granston (“Granston”), Director of the Civil Fraud Section, announced that the DOJ will now move to dismiss qui tam actions brought under the False Claims Act when it concludes that the actions lack merit. The announcement was made during a presentation at the Health Care Compliance Association’s Health Care Enforcement Compliance Institute on Octob

During the past year, Wells Fargo has faced a number of scandals. In addition to the bank account scandal ( here ) in which millions of accounts were set up under customers’ names without their permission, the bank forced thousands of customers into car insurance they did not need, and also charged improper rate-lock fees to mortgage applicants. Now, in a recent filing ( here ), Wells Fargo has disclosed that a number of employees have filed retaliation claims after they were

Many leases provide for a tenant’s option to purchase the subject real property. The recent case of Blackburn Food Corp., et. al. v. Ardi, Inc., et. al ., (Sup. Ct. Suffolk Co. October 25, 2107), illustrates the importance of, inter alia , careful drafting when dealing with real property purchase option agreements. The plaintiffs in Blackburn entered into a ten-year lease for real property. The lease contained an option, which, if exercised within the first three years of

It has been some time since this Blog has written about the False Claims Act (“FCA”). In today’s post, this Blog looks at the Seventh Circuit’s recent embrace of the proximate cause standard for claims arising under the FCA. In United States v. Luce ( here ), the Seventh Circuit overruled its longstanding precedent for alleging causation in cases arising under the FCA. In doing so, the Seventh Circuit joined its sister circuits in holding that the government and whistleblow

On November 2, 2017, the Securities and Exchange Commission (“SEC” or the “Commission”) announced (here) that it had charged Osiris Therapeutics, Inc. (“Osiris” or the “Company”), a Maryland-based biotech company, and four former senior executives with inflating reported revenue growth, improperly recognizing revenue and misleading investors. In its complaint (here), the SEC alleged that Osiris routinely overstated Company performance and issued fraudulent financial statemen

If a contracting party intends for the obligations under a contract to be executed by a business entity, it is critical that the person executing the contract on behalf of the entity clearly indicate that the contract is being signed in a representative capacity. This point was recently reiterated in James E. Cayne v. Alexandra Lebenthal , (Sup. Ct. New York Co. October 30, 2017) (the “Action”). The Defendant in Cayne is Alexandra Lebenthal, CEO of Lebenthal Holdings, LLC

Preliminary injunctions can be an important and potent weapon in business and commercial litigation. In New York, “ preliminary injunction may be granted … where it appears that the defendant threatens or is about to do … an act in violation of the plaintiff’s rights” with regard to the subject matter of the action, and which “render the judgment ineffectual ….” CPLR 6301. Whether to grant a preliminary injunction lies within the sound discretion of the court. Doe v. Axe

Parties to commercial and business disputes frequently encounter and litigate the threshold question whether their dispute must be arbitrated rather than litigated in court. But, before this question can be answered, there is an even more fundamental question that must be resolved: who decides whether a dispute is subject to arbitration – the court or the arbitrator? Courts have struggled with this question for years and continue to do so today. Generally, whether a claim is

Mortgages on real property are typically delivered to a lender to secure loans evidenced by promissory notes. When a default occurs under the note and/or mortgage litigation frequently follows. If the borrower and/or guarantor are solvent, the lender may choose to sue on the note for monetary damages in an action at law. If the property is valuable, but the borrower has insufficient funds to satisfy a money judgment the lender might decide to sue to foreclose the mortgage

The Basics A contract is an agreement between two or more parties to do something ( e.g. , provide goods or services) in exchange for a benefit. When one or more parties to a contract fails to perform a term in their agreement, they are in breach of that agreement. Most breaches fall into one of two categories: actual or anticipatory. In the former, a party to the contract fails or refuses to perform his/her obligations under the agreement or performs his/her obligations i

Investing in the stock market can be challenging. Understanding investment vehicles like stocks, bonds, limited partnerships, annuities, hedge funds, derivatives and mutual funds can be overwhelming for investors. For that reason, many investors rely on stockbrokers and financial advisors to provide suitable investment advice to protect their hard-earned money. While most brokers and financial advisors act in their customer’s best interest, some do not. When that happens,

CPLR § 306-b provides: Service of the summons and complaint, summons with notice, third-party summons and complaint, or petition with a notice of petition or order to show cause shall be made within one hundred twenty days after the commencement of the action or proceeding, provided that in an action or proceeding, except a proceeding commenced under the election law, where the applicable statute of limitations is four months or less, service shall be made not later than fif

On October 17, 2017, the National Whistleblower Center, a non-profit, tax-exempt, non-partisan whistleblower legal advocacy organization, Senator Charles Grassley, and the U.S. Government filed amici briefs before the U.S. Supreme Court in Digital Realty Trust v. Somers (No. 16-1276). In July of this year, this Blog posted an article about the case. ( Here .) The issue in Somers concerns the definition of “whistleblower,” and whether the anti-retaliation provisions in the

Last year was a banner year for fines levied by the Financial Industry Regulatory Authority (FINRA) regarding the sale of variable annuities. In 2016, $30.3 million in fines were assessed over 30 variable annuity cases. Now, the industry watchdog is continuing its crackdown on these financial products, with an emphasis on annuity exchanges. Annuity Exchange Abuses Recently, FINRA’s enforcement unit suspended two brokers and ordered the disgorgement of more than $185,000 in co

Certain provisions of New York’s Labor Law require that construction workers be provided with a safe work environment. Contractors and owners can be held strictly liable under certain circumstances if a construction worker is injured while working on a construction project. Such strict liability may apply to homeowners if they become too helpful or involved with construction and, therefore, render inapplicable the exceptions inserted into the Labor Law for their protection.

On October 12, 2017, the House Financial Services Committee approved legislation that would provide legal protection for financial advisers who report the financial abuse and exploitation of senior Americans to authorities. The bill, which was unanimously approved by the committee, will go to the House floor for a vote. Like the current bill, the previous version of the Safe Act received broad bipartisan support during the last Congress. Congressman Bruce Poliquin (R-ME) and

The SEC recently announced that fraud charges were being brought against the creator of two Initial Coin Offerings (“ICOs”). The complaint alleges that Maksim Zaslavskiy ("Zaslavskiy") defrauded investors with two ICOs, the REcoin Group Foundation, LLC ("REcoin") and the DRC World, Inc. (also known as the Diamond Reserve Club) ("DRC"), that were said to be backed by investments in real estate and diamonds. What is an ICO? ICOs are a way for startups to raise money by issuing