Recent Developments

Snap Judgment—S&P Dow Jones and FTSE Russell Indices Ensure That Investors Retain Voting Rights

Silicon Valley is known for disrupting industries, and some of its most storied residents seem ready to upend the IPO world—not with technology, but with moxie. Snap, Inc. made headlines* this past spring with its novel initial public offering (IPO) selling "Class A" common shares without voting rights. Rather than the standard practice of taking an investor's capital in exchange for the right to hold the company's management accountable for its use, Snap sold over 200 million shares at $17 apiece without giving those investors any voting rights. Instead, Snap's two co-founders retained 88.5 percent of the company's voting power.

Berman DeValerio’s Tenacity Results in Post-Trial Judgment for Plaintiff Class

After six years of hard-fought litigation, including a nine-day trial, Berman DeValerio secured a $3 million disgorgement award against the former CEO and controlling shareholder of PHC, Inc., Bruce A. Shear. The case began in 2011, when PHC agreed to be acquired by Acadia Healthcare, Inc. The plaintiffs alleged that Shear used his position as PHC's controlling shareholder to wrongfully obtain benefits for himself at the expense of PHC's other shareholders. Berman DeValerio aggressively pursued the action on behalf of PHC's aggrieved minority shareholders, overcoming challenging court opinions as well as two trips to the First Circuit Court of Appeals.

Initial Congressional Efforts at Dodd-Frank “Repeal” Appear Poised to Leave SEC Whistleblower Program Intact with Some Restrictions

Much has been made, since the Trump administration took office backed by a Republican-controlled Congress, about the potential repeal of The Dodd Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank"). Many interested in Wall Street regulation and reform expressed concern over this prospect, given that Dodd-Frank was passed in the wake of the Financial Crisis in an effort to prevent some of the more egregious financial excesses that led to the market collapse.

Supreme Court Upends Class Action Tolling under the Federal Securities Laws

The U.S. Supreme Court has issued its much-anticipated decision on class action tolling, deciding that the filing of a class action under the Securities Act of 1933 does not toll the statute of repose for an individual to bring the same claim or claims as the class action. The 5-4 decision in California Public Employees' Retirement System v. ANZ Securities, Inc., No. 16-373, upends the current practice of opting out of securities class actions with significant implications for investors, effectively killing reliance on class action tolling in federal securities class actions. Justice Kennedy wrote the Court's opinion, with Justices Roberts, Thomas, Alito, and Gorsuch joining; Justice Ginsburg wrote the dissent, with Justices Breyer, Kagan, and Sotomayor joining.

Ireland Goes Its Own Way And Rejects Third-Party Litigation Funding

Since 2010, when the U.S. Supreme Court ruled in Morrison v. Australia National Bank Ltd., 561 U.S. 247 (2010) that purchasers of securities that were traded on a non-U.S. exchange could not bring claims under U.S. federal securities laws, we have observed two key trends. First, there has been a significant increase in securities litigation brought on a group basis in Europe, Canada, Australia, Japan and other non-U.S. jurisdictions. Second, and relatedly, third-party litigation funding has greatly expanded in various countries ...