(Reuters) – Roni Dersovitz is a onetime personal injury lawyer who transformed himself into a financier deploying $170 million in capital to litigation funding. Last month, after a year-long investigation, the Securities and Exchange Commission brought an administrative proceeding against Dersovitz, accusing the New Jersey fund manager of deceiving investors about his outsized bet on a default judgment against Iran. On Monday, Dersovitz and his lawyers at Hughes Hubbard & Reed struck back at the agency with a complaint in federal court in Newark. Dersovitz’s suit asks for an injunction against the SEC’s case, arguing (among other things) that new rules the agency adopted last month exacerbate the due process deficiencies of administrative proceedings.
(Reuters) – There is one big reason why Uber drivers have been able to pursue class actions against the company in federal court in California: the state’s one-of-a-kind Private Attorney General Act, which allows employees to sue for labor code violation in the name of the state. As a matter of public policy, according to a 2014 decision from the California Supreme Court, companies cannot compel PAGA claims to be arbitrated. So even though Uber’s contracts with drivers include provisions requiring them to arbitrate disputes with the company individually, U.S. District Judge Edward Chen of San Francisco has held Uber’s class action waivers to be unenforceable because of drivers’ PAGA rights.
(Reuters) – I never cease to be amazed at how creatively people use the law to make money. Consider the example of Melody Stoops, a Pennsylvania resident who bought dozens of prepaid cellphones she kept in a shoebox. Stoops activated the phones to be assigned telephone numbers in Florida area codes hard hit by the economic downturn, then waited for credit card companies and debt collectors to call. When her phones received unsolicited calls – basically, the only calls they received since Stoops never gave her numbers to anyone she wanted to hear from – Stoops would log callers’ information.
(Reuters) – It’s easy to understand why groups such as the U.S. Chamber of Commerce, the American Tort Reform Association and the Coalition for Government Procurement are siding with State Farm in one of the most colorful business cases the U.S. Supreme Court will hear in its upcoming term. But the organized criminal defense bar?
(Reuters) – U.S. District Judge William Alsup of San Francisco refuses to bow to orthodoxy when it comes to selecting plaintiffs’ firms to lead securities class actions.
The First Amendment of the U.S. Constitution has been very good to Backpage.com, the online classified ad publisher that has achieved notoriety for its adults-only section.
(Reuters) – Let’s face it: If you’re on the losing side of an arbitration decision, you’re probably not going to get the arbitral ruling overturned, regardless of whether your appeal takes place in state or federal court. Far more often than not, courts defer to arbitrators.
A footnote in the 1977 California Supreme Court decision in Serrano v. Priest created four decades of nagging doubt about the proper method for California state judges to calculate fee awards for class action lawyers. Serrano III, as the ruling is known, could be read to require judges to award fees based plaintiffs’ lawyers’ hourly billings – and not on the size of the recovery the lawyers obtained for class members.
(Reuters) – It took the Department of Labor three tries to adopt new rules for brokers and financial advisers who sell retirement-related products. As Reuters reported when the new policy was adopted last April, the Labor Department’s previous attempts in 2010 and 2015 met with such an outcry from the insurance, brokerage and investment advisory industries that proposals were pulled out of consideration and revised. And, of course, finance professionals aren’t the only stakeholders in the regulation of retirement investment advisers. It is safe to say that millions of people are impacted by the new regulations, which, among many other things, require brokers to act in the best interests of their clients, rather than just assuring that brokers’ products are suitable for their clients.
(Reuters) – On Monday, the plaintiffs’ firm Scott & Scott asked U.S. District Judge William Pauley for permission to drop its five-year-old case against Bank of New York Mellon. Scott & Scott’s client, a pension fund for Chicago police officers, had accused BNY Mellon of failing investors in Countrywide mortgage-backed securities trusts by neglecting its duties as trustee. Its complaint, filed in August 2011, presaged a surge of similar investor suits against MBS trustees that intensified after New York’s highest court set a hard-and-fast six-year time limit on breach of contract suits against MBS issuers.