Will A Bump-Up Exclusion Bar Coverage of an M&A Settlement? It Depends.
Public company insurance policyholders beware: In recent years, insurance carriers have increasingly invoked the “bump-up” exclusion, which is a carve out provision typically found in directors and officers (D&O) insurance policies. In many public company M&A deals, the shareholders of the target or acquired company will file a lawsuit challenging […]
SEC Remains Focused on Disclosure of Cybersecurity Incidents
Recent Securities and Exchange Commission (SEC) enforcement action and statements by SEC officials show that the Commission remains focused on disclosures regarding cybersecurity incidents. On May 21, 2024, Erik Gerding, director of the SEC’s Division of Corporate Finance, issued a statement to clarify that public companies are only required to […]
Ninth Circuit Affirms Dismissal of Securities Fraud Claims, Rejects Allegations as Nothing More Than ‘Interesting Reading’
A recent decision of the US Court of Appeals for the Ninth Circuit highlights the “heightened and demanding standard” required to plead securities fraud under the Private Securities Litigation Reform Act (PSLRA). In affirming the district court’s dismissal of securities fraud claims, the Ninth Circuit made clear that “[d]issatisfaction with […]
US Supreme Court: Pure Omissions Not Actionable UnderRule 10b-5(b)
On April 12, 2024, the US Supreme Court reversed the US Court of Appeals for the Second Circuit’s decision in Macquarie v. Moab Partners and held that a pure omission cannot form the basis of a securities fraud claim under Rule 10b-5(b). SCOTUS made clear that an omission is only actionable if it […]
Securities Litigation + Enforcement Highlights From Q1 2024
To kick off 2024, Cooley’s securities litigation + enforcement practice guided clients through significant developments in securities law, shared insights on recent trends in securities filings and settlements, and earned a spot on The American Lawyer’s Litigation Daily Litigator of the Week Runners-Up and Shout Outs list for securing an […]
Delaware Double Whammy Casts Doubt on M&A Practices
Delaware courts recently issued important decisions that impact M&A dealmakers and lawyers. In this post, we dive into two cases that serve as a reminder that Delaware grounds review of corporate actions in statutory requirements and not market practice, no matter how prevalent. In response, legislation to resolve the ambiguity […]
Securities Class Action Settlement Trends: Number of Settlements Down, But Dollar Amounts Up, According to Cornerstone Research
Cornerstone Research, a top consulting and expert testimony firm, recently issued its annual report analyzing securities class action settlements. Cornerstone reported that, in 2023, the number of settlements in securities class actions declined, but the settlement dollar amounts increased. The settlement data shows that securities class actions can create substantial […]
Delaware Chancery Court Allows TripAdvisor to Move to Nevada, But Lets Stockholders Pursue Their Claims for Damages
Delaware corporations contemplating conversion to another state should take note of a recent Delaware Court of Chancery decision in which Vice Chancellor J. Travis Laster declined to enjoin a corporate move to Nevada, but sustained stockholder allegations that the defendants breached their fiduciary duties in connection with approving the conversion.
Trending in securities class actions: Section 10(b) claims predominate, Ninth Circuit sees uptick, according to Cornerstone Report
Cornerstone Research (a top consulting and expert testimony firm) issued its 2023 Year in Review report, examining recent trends in securities class action filings. According to the report, in 2023 there was a slight uptick in securities class action filings, which had been seeing a downward trend in years prior. […]
Second Circuit Highlights Difficulty in Pleading Fraud Claims Involving the Interpretation of Clinical Data
Plaintiffs often file securities fraud claims against pharmaceutical companies alleging that the company misled investors about clinical data, despite the US Food and Drug Administration (FDA) subsequently approving the drug and agreeing with the company’s interpretation. In December 2023, the US Court of Appeals for the Second Circuit affirmed dismissal of […]