Remember Imperial Holdings, the Florida life insurance settlement company that last fall adopted a bylaw requiring shareholders to amass written consent from a minimum percentage of their fellow investors in order to sue the board? Imperial was apparently the first public corporation to impose a minimum-stake-to-sue restriction on shareholders’ right to sue, but as the company’s chairman, activist investor Phillip Goldstein, predicted at the time, other companies he controls have since adopted similar provisions. Goldstein has told me many times that the bylaws are not intended to block all shareholder suits but to weed out frivolous cases by investors (and plaintiffs’ lawyers) acting in their own interests rather than the interests of the company.
(Reuters) – Way back in October 2005, I had lunch with an entertainment lawyer named Roy Langbord and Langbord’s own lawyer, Barry Berke of Kramer Levin Naftalis & Frankel, to talk about a cache of exceedingly rare gold $20 coins known as 1933 Double Eagles. 1933 Double Eagles were minted in the midst of President Roosevelt’s gold recall, and all of them were supposed to have been melted down. A handful of the coins nevertheless disappeared from the U.S. Mint, in a theft the federal government believed to have been masterminded by Langbord’s grandfather, a Philadelphia jeweler named Israel Switt.
Some members of the National Association of Manufacturers would like to see the U.S. Supreme Court reverse the 7th U.S. Circuit Court of Appeals’ opinion in Motorola v. AU Optronics, which limited the reach of U.S. antitrust laws over foreign transactions, even if the deals involved products eventually sold in the U.S. Other NAM members might like to see the 7th Circuit’s narrow interpretation prevail. But the entire U.S. manufacturing industry, according to an amicus brief NAM filed at the Supreme Court on Thursday, needs the justices to resolve the uncertainty created by a split between the 7th and 9th Circuit interpretations of how American antitrust laws apply to global supply chains.
(Reuters) – When I saw news Wednesday that Target had reached a $19 million settlement with MasterCard to reimburse issuers of MasterCard-branded cards for costs associated with Target’s gigantic 2013 data breach, I thought there was something strange about the announcement. Target has been embroiled in multidistrict litigation over the data breach since 2014, including consolidated class actions by financial institutions that claim to have spent billions of dollars to replace compromised cards and beef up customer service operations because of the data breach. Last December, U.S. District Judge Paul Magnuson of St. Paul, Minnesota, refused to dismiss the banks’ case.
(Reuters) – If there was any doubt about the complexity of applying the U.S. Supreme Court’s 2010 ruling in Morrison v. National Australia Bank to the Racketeer Influenced and Corrupt Organizations Act, it was resolved Monday by the 2nd U.S. Circuit Court of Appeals in a case called European Community v. RJR Nabisco. To be clear: the 2nd Circuit didn’t resolve the issue of RICO’s extraterritorial reach, although a majority of court declined to hear the RJR case en banc. But the appeals court decision – which included four dissenting opinions from five 2nd Circuit judges – confirms the difficulty of deciding when plaintiffs can bring civil RICO suits based on alleged crimes that took place abroad.
(Reuters) – In dueling briefs filed Friday, the Kingdom of Saudi Arabia and the families of people killed in the attacks of September 11, 2001 made their last written arguments to U.S. District Judge George Daniels of Manhattan, who will decide later this year whether the families can bring claims against Saudi Arabia for allegedly helping al Qaeda operatives carry out the 9/11 attacks.
A couple of weeks ago, I wrote about a fee opinion by U.S. District Judge Lewis Kaplan of Manhattan, who decided that a request by class counsel for 13 percent of a $346 million settlement with underwriters of IndyMac mortgage-backed securities was just too much. Even though the 13 percent request was in line with the fee deal plaintiffs’ firms had negotiated in advance of the litigation with the lead plaintiff, a public pension fund, Kaplan cut the fee award to 8 percent, based on his own experience with securities class actions and skepticism about the hours reported by class counsel.
(Reuters) – Way back in October 2013, the home appliances company Electrolux first petitioned the 11th U.S. Circuit Court of Appeals to permit its appeal of the certification of a class of washing machine purchasers. At the time, the U.S. Supreme Court’s decision in Comcast v. Behrend was only seven months old. Electrolux’s lawyers at Skadden, Arps, Slate, Meagher & Flom cited the decision to argue that U.S. District Judge Lisa Wood of Augusta, Georgia, should not have granted certification to two statewide classes of consumers who claimed their front-loading Electrolux washers were defectively designed with a tendency to develop a moldy smell.
(Reuters) – The Anti-Terrorism Act – which grafts civil remedies onto criminal statutes aimed at international attacks by militant groups – is confusing. As U.S. District Judge Brian Cogan of Brooklyn explained Wednesday in an opinion upholding a jury verdict of liability under the ATA against Jordan-based Arab Bank, the civil provisions “are derived from a complicated series of incorporations by reference” from the criminal laws – not, in other words, the easiest statutory texts for judges to interpret.
(Reuters) – On Monday, U.S. District Judge Jed Rakoff of Manhattan got up onto his well-worn soapbox to suggest that if Congress wants to protect U.S. markets from inside traders, lawmakers ought to specify when it is illegal to trade on confidential information.