Securities

Our lawyers have extensive experience in securities litigation and investigations, representing executives, directors, officers, corporations, investment companies and investment advisors in litigation and before the SEC and Massachusetts regulators.  In the mutual fund area, we have represented well known mutual funds and independent trustees in class action litigation, executives in investigations over practices such as market timing and a special litigation committee of a family of major mutual funds as Massachusetts counsel.  We take pride in the excellent results we have achieved for our clients in litigation and in the aftermath of investigations.  Although securities matters are often very complex, we focus on assessing our clients’ situation, coordinating closely and efficiently with other players as appropriate and in our client’s interest, and securing the best result for our client.

The range of matters in which we have experience span the Investment Company Act of 1940, Section 10(b) and other claims under the Securities Exchange Act of 1934, claims related to public offerings under the Securities Act, the Investment Advisers Act of 1940 and fraud related claims arising under state law.  We also handle shareholder or partnership derivative cases raising issues such as breach of fiduciary duty, waste and professional liability.

• Defended a regional accounting firm against direct and derivative claims in Delaware Chancery Court filed on behalf of investors in hedge funds audited by our client. Plaintiffs alleged that the value of the two portfolio companies, in which the hedge funds had invested over $30 million, was inflated and that the accounting firm had negligently certified the financial statements without qualification.  After a hearing on pending motions, rather than proceed in the face of the court’s adverse order on jurisdictional discovery, plaintiffs voluntarily dismissed their claims, which they have refiled in Massachusetts.

• Successfully represented family of mutual funds in litigation brought under Investment Company Act of 1940 and related theories. The federal district court dismissed the claims, in part based on arguments that we made on behalf of the funds, that (i) most of the claims should properly have been asserted as derivative claims and (ii) plaintiff failed adequately to plead an excuse for failure to make demand upon the funds. In re Eaton Vance Mutual Funds Fee Litigation, 380 F. Supp. 2d 222, (S.D.N.Y. 2005), 403 F. Supp. 2d 310 (S.D.N.Y. 2005), aff’d 481 F. 2d 110 (2d Cir. 2007).

• Represented a mutual fund as nominal defendant in claims brought under Investment Company Act of 1940 and common law. After the firm moved to dismiss the two derivative counts due to plaintiffs' failure to make pre-suit demand, the plaintiffs withdrew those claims.

• Defended independent trustees of the Reserve Fund in a mutual fund “breaking the buck” case.  The court granted defendants’ motion for stay and the case was then consolidated with other related cases as a multi-district litigation in the Southern District of New York.  After the New York federal court remanded the case back to state court, the plaintiff voluntarily dismissed its claims based on an order by the federal court in a related SEC action.

• Represented out-of-state public company in connection with shareholder litigation relating to acquisition of Massachusetts public company, which was successfully resolved to permit acquisition to proceed.

• Represented business executives and officers in various SEC and state securities investigations involving mutual funds, financial services companies, software companies and other industries with issues including market timing, backdated options, trading practices, insider trading, conflicts, revenue recognition and financial reporting.

• Represented software company in Federal court litigation involving sale of its assets to another company in return for cash, stock and an earn-out. On behalf of our client we asserted misrepresentation claims against the former CEO and CFO of the purchaser based on diminished value of purchaser’s stock and earn-out. The case settled after mediation to the satisfaction of our client.

• Argued motions to dismiss leading to the resolution of claims for more than $200 million in damages against five former outside directors of a publicly traded Canadian entertainment company. In re Livent Inc. Noteholders Securities Litigation, 151 F. Supp. 371 (S.D.N.Y. 2001); Griffin v. PaineWebber Incorporated, 84 F. Supp. 508 (2000).

• Defended an investment advisor and certain affiliated entities and individuals in four related class actions involving certain public mezzanine limited partnerships. After considerable motion practice, factual and expert discovery, the case was settled on favorable terms utilizing, in part, certain unique non-cash mechanisms. In re ML-Lee Acquisition Fund II, L.P. Securities Litigation, 848 F. Supp. 527 (D. Del. 1994).

• Represented four venture capital firms in defending federal securities fraud and related claims arising out of an acquisition. After obtaining dismissal of the claims from federal court, the claims were settled.

• Successfully represented two in-laws of the CEO of a publicly-traded pharmaceutical company in an SEC investigation into potential insider trading. Following Wells submission, SEC decided not to proceed with the case.

• Represented two non-management company directors and several former shareholders in a putative securities law class action arising out of certain disclosures in the registration statement for a secondary public offering and in other public statements. The United States District Court for the Western District of Pennsylvania granted defendant’s motion to dismiss and the Court of Appeals for the Third Circuit affirmed in a decision at 186 F. 3d 338.

• Represented the former CFO of a public biotechnology company in an SEC investigation that focused on the Company's restatement of its financial results due to the improper recognition of revenue. The SEC concluded its investigation without filing any charges against the CFO.

• Represented a former director and controlling shareholder of beverage corporation against Williams Act claims arising out merger. Plaintiffs agreed to dismiss all claims against the client after reviewing draft motion to dismiss.

• Represented bank holding corporation and its former vice-chairman and former CFO in defending securities law class action claims relating to certain lending and accounting practices of the subsidiary bank. Also succeeded in establishing insurance coverage for the claims in a declaratory judgment action that had been commenced by the directors and officers insurance liability carrier.

• Represented a Connecticut-based broker-dealer in defense of a customer complaint alleging a pattern of unauthorized and inappropriate trading.

• Represented a New York-based broker-dealer in defense of a customer complaint in arbitration as well as in the courts of Tennessee. Following a successful motion to remand and a summary judgment motion, case was settled advantageously.