A federal judge has given Well Fargo & Co. preliminary approval of its proposed $142 million class-action settlement to compensate millions of customers swept up in the fake account scandal that led to the ouster of CEO John Stumpf in October 2016. Current Wells Fargo Chief Executive Tim Sloan said in a statement that the proposed settlement represents "a major milestone in our efforts to make things right for our customers." The Wells Fargo Scandal The scandal broke in 201

The Consumer Financial Protection Bureau (CFPB) has released a highly anticipated rule that bars banks and credit card companies from using arbitration clauses to prevent customers from joining class action lawsuits. The rule was initially proposed by CFPB Director Richard Cordray last year and is slated to go into effect in eight months. Currently, mandatory arbitration clauses are used in an array of financial products and the rule applies to new agreements for credit card

On July 13, 2017, Charlotte-based LPL Financial, the largest retail investment advisory firm and independent broker-dealer in the United States, announced that it planned to provide its advisers with a new mutual fund platform early next year to improve the way its advisors offer mutual funds in brokerage accounts with participating fund companies, reduce fees for investors and standardize adviser compensation. “With this platform, LPL is striving to preserve choice for inve

Under Section 10 of the Federal Arbitration Act (“FAA”), a party can vacate or modify an arbitral award under four narrow circumstances: “(1) where the award was procured by corruption, fraud, or undue means; (2) where there was evident partiality or corruption…; (3) where the arbitrators were guilty of misconduct … or of any other misbehavior by which the rights of any party have been prejudiced; or (4) where the arbitrators exceeded their powers ….” 9 U.S.C. §10(a). These

On June 26, 2017, the U.S. Supreme Court ruled, in a 5-4 decision, that the three-year statute of repose in Section 13 of the Securities Act of 1933 (the “Securities Act” or the “’33 Act”) is not subject to equitable tolling under American Pipe & Construction Co. v. Utah , 414 U.S. 538 (1974). California Public Employees’ Retirement Sys. v. ANZ Sec., Inc. , No. 16-373 (U.S.) ( here ). Background ANZ Securities arose from the demise of Lehman Brothers Holdings Inc. (“Lehman”)

On June 27, 2017, the United States Supreme Court agreed to consider whether state courts retain concurrent jurisdiction over lawsuits brought under the Securities Act of 1933 (the “’33 Act” or the “Securities Act”), or whether the Securities Litigation Uniform Standards Act of 1998 (“SLUSA”) pre-empts them from considering such cases. ( Here .) Resolution of the issue will address a concern for issuers, underwriters and others involved in initial public offerings (“IPOs”) –

On Monday, June 26, 2017, the United States Supreme Court agreed to consider whether the anti-retaliation provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act” or the “Act”) extends to individuals who have not reported alleged misconduct to the Securities and Exchange Commission (“SEC”) and, thereby, fall outside the Act’s definition of “whistleblower.” Digital Realty Trust v. Somers , 16-1276. In Digital Realty Trust v. Somers

As noted in a prior Blog post ( here ), the Labor Department's fiduciary rule, at least the first phase of the rule, has gone into effect, though its future remains uncertain. On June 9, 2017, two provisions of the rule, which requires financial advisers and other investment professionals to act in the best interest of their clients and to disclose any potential conflicts of interest when providing retirement advice, became effective. One expands the definition of who is a fi

Last year, this Blog wrote about a qui tam action that was dismissed by the Sixth Circuit because of the application of the public disclosure bar ( here ). In United States ex rel. Advocates for Basic Legal Equality v. U.S. Bank , 816 F.3d 428 (6th Cir. 2016), the Sixth Circuit held that prior public disclosures are “substantially the same” for purposes of the public disclosure bar if they “encompass” the allegations in the subject qui tam action even though the prior discl

On June 23, 2017, President Trump signed legislation that is intended to protect whistleblowers who report problems at the Department of Veterans Affairs ("VA"), and improve employee accountability for misbehavior and abusive conduct. In April of this year, the president signed an executive order that created the Office of Accountability and Whistleblower Protection ("OAWP") within the VA to investigate allegations of misconduct – including retaliation against whistleblowing

Since the early 1900s, tortious interference with contractual relations has been a viable cause of action in New York. E.g. , S.C. Posner Co. v. Jackson , 223 N.Y. 325, 332 (1918); Lamb v. Cheney & Son , 227 N.Y. 418, 421 (1920). It occurs when a business or individual who is not a party to a contract intentionally disrupts a business relationship formed by a contract. Lama Holding v. Smith Barney , 88 N.Y.2d 413, 424 (1996). Under New York law, an action for interference w

Jimmy Smith is widely considered to have been one of the most influential and accomplished jazz musicians of his time, if not in jazz history. Smith, who died in 2005, revolutionized the use of the Hammond B3 organ in modern jazz, laying the groundwork for generations of jazz musicians to come. Estate of James Oscar Smith v. Cash Money Records, Inc. In 2013, rapper/singer/songwriter Drake released Pound Cake/Paris Morton Music 2 (“Pound Cake”) on his album, Nothing Was the

The New York Statute of Frauds provides that “ contract for the . . . the sale, of any real property, or an interest therein, is void unless the contract or some note or memorandum thereof, expressing the consideration, is in writing, subscribed by the party to be charged, or by his lawful agent thereunto authorized by writing.” New York General Obligations Law § 5-703(2). “To satisfy the statue of frauds, a memorandum evidencing a contract and subscribed by the party to be

The Department of Justice recently announced a settlement with eClinicalWorks ("ECW" or the "Company") related to alleged False Claims Act violations. The Massachusetts-based company, one of the largest electronic health records ("EHR") vendors in the U.S., had been accused of misrepresenting its software capabilities and paying kickbacks to customers in exchange for promoting its product. What is the False Claims Act? The False Claims Act is designed to protect the governme

Yesterday, the House of Representatives voted along party lines to repeal many of the regulations enacted after the 2008 financial crisis under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank Act”). It was the first step for Republicans who have long-promised to eliminate regulations they maintain are hurting banks, restricting consumer credit, inhibiting small businesses, and slowing economic growth. The legislation faces significant hurdl

On June 5, 2017, the U.S. Supreme Court held that claims for disgorgement imposed as a sanction for violation of the federal securities laws must be commenced within five years of the date the claim accrues. In doing so, the Court rejected the SEC’s argument that the five-year statute of limitations was not applicable to claims for disgorgement. The decision, written by Justice Sonia Sotomayor for a unanimous court, resolves a split among the circuits and provides clarity co

The Fiduciary Rule (the “Rule”) is designed to protect investors receiving investment advice about qualified retirement plans and individual retirement accounts (“IRAs”) by requiring all registered brokers, financial advisers, and other investment professionals (collectively, “Financial Advisors”) to act in the best interest of their clients and to disclose any potential conflicts of interest when providing retirement advice. The Rule also requires Financial Advisors who earn

Arbitration is an alternative to a court proceeding. It is an adversarial proceeding in which the parties can call witnesses and present evidence to a neutral arbitrator or panel of arbitrators. The rules of discovery and evidence are relaxed to make it a shorter and more cost-efficient process. An attorney or retired judge, who works for a private firm, conducts the proceeding. Often, the parties select the arbitrator or panel of arbitrators. Arbitration can be binding, in