News, Results & Firm Blog

It is likely that you have encountered a webpage terms and conditions agreement if you have used the internet.  Some are prompted upon visiting the site, while others are hidden in small text off in the bottom corner.  In Nguyen v. Barnes & Noble (763 F.3d 1171), the Ninth Circuit addressed the sufficiency of notice...

On October 2, the SEC issued interpretations regarding the application of Rule 147 (17 CFR 230.147), the safe harbor provision under Section 3(a)(11) of the Exchange Act.  Generally known as the “intrastate offering exemption,” issuers can claim this federal registration exemption for offers and sales to residents of the same state the company...

Earlier this week, the Supreme Court addressed the evidentiary burden of the amount in controversy for federal diversity removal pursuant to CAFA (28 U.S.C. 1332(d)(2)).  A “short and plain statement” suffices, with proof by a preponderance required only if the plaintiff contests the amount alleged. In Dart Cherokee Basin Operating Co,...

In two simultaneous appeals, the Second Circuit addressed whether a forum-selection clause supersedes mandatory FINRA arbitration under FINRA Rule 12200. In Goldman, Sachs & Co. v. Empire Schools Financing Authority (764 F.3d 210), the plaintiff commenced arbitration against underwriter Goldman for claims related to issued securities.  Around...

You probably have heard of kickstarter.com or indiegogo.com, but may not be familiar with Eureeca.com.  Although similar, Eureeca provides a global crowdfunding platform for small and medium sized non-U.S. based companies.  However, neither Eureeca nor any of the securities the website offered were registered with the SEC.  Moreover, the website...

In Starr Investments Caymen II, Inc. v. China MediaExpress Holdings, Inc., (2014 WL 4180331), plaintiff stockholder Starr Investments brought numerous claims based in securities fraud, state law fraud and corporate governance, against CMEH, previous directors, an independent accounting firm, investment companies and their control...

The Court of Appeals of California, Second Appellate District, recently affirmed dismissal of shareholder derivative suit Jones v. Martinez (230 Cal.App.4th 1248).  Jones brought various claims for breach of fiduciary duties against Deckers Outdoor Corporation derivatively, but made no demand on the directors, nor pleaded demand...

The Delaware Court of Chancery addressed another a forum selection bylaw in City of Providence v. First Citizens Bancshares, Inc. (2014 Del. Ch. LEXIS 168).  Although similar to the bylaw addressed in Boilermakers v. Chevron Corp. (73 A.3d 934), the provision here selected North Carolina as the forum for a Delaware...

In In Re: Robert Lodholtz, et al. (2014 U.S. App. LEXIS 19107), insurer Granite State Insurance Company attempted, desperately, to avoid defending and indemnifying its insured, Pulliam Enterprises.  After being denied relief in state court, Granite sought relief in federal court based on the same argument. Lodholtz had brought suit...

After reading through the opinion of the California Court of Appeals it is surprising to find that the trial court granted summary judgment for Ensign in Castaneda v. The Ensign Group, Inc. (229 Cal.App.4th 1015). Castaneda filed a class action suit against Ensign, alleging violations of California Labor Code for unpaid minimum and...

After the district court certified the class in Local 703 v. Regions Financial Corp. (762 F.3d 1248), Regions appealed the order.  The Eleventh Circuit found the certification well-reasoned but remanded to reconsider in regards to the recently decided Halliburton Co. v. Erica P. John Fund, Inc. (Halliburton II, 134...

Earlier this year, the Delaware Supreme Court made headlines upholding the validity of a fee-shifting bylaw in ATP Tour, Inc. v. Deutscher Tennis Bund (91 A.3d 554).  We reported on the decision, a likely related application of California law, and the Delaware legislatures' response thereafter. Also shortly after the decision, the Oklahoma State...

After a NY Times article alleged that Wal-Mart executives knew subsidiary Wal-Mex bribed Mexican government officials, a group of stockholders demanded to inspect documents related to the incident.  Wal-Mart responded to the demand but declined to produce privileged material and highly redacted information from the documents it...

The plaintiff in Jimenez v. Allstate Ins. Co. (2014 WL 4338841) brought a putative class action suit against Allstate, alleging the insurer had unofficially required claims adjusters to work unpaid off-the-clock overtime in violation of California law. In 2005, Allstate reclassified all California-based claims adjusters from...

Without a duty to act, a claim for negligence will usually fail.  The Eighth Circuit recently faced the question of whether a bank has to investigate the authority of a customer opening a d/b/a account. In Nat'l Union Fire Ins. Co. of Pittsburgh, PA v. Raczkowski (2014 WL 3929101), investment advisor, Mark Henry opened a d/b/a bank...

In Int'l Bhd. of Elec. Workers Local 2150 v. NextEra Energy Point Beach, LLC (2014 WL 3895757), NextEra attempted to avoid arbitration after terminating an employee by claiming the discharge and arbitration was dependent on the separate issue of maintaining security clearance and outside the arbitration agreement. NextEra employed John Hofstra at...

In September 2013, the plaintiff Cortina filed a class action suit against Wal-Mart, alleging eleven causes of action based on false and misleading statements regarding a health supplement in Cortina v. Wal-Mart, Inc (2014 WL 2906285).  The plaintiff alleged violations of the Magnuson-Moss Warranty Act, Arkansas Deceptive Trade...

The plaintiffs of In re: PHC, Inc. Shareholder Litigation (2014 WL 3867494) appealed the entry of summary judgment against their action challenging the company’s recent merger. After PHC announced a merger with another health care company, the stockholders sued for breach of fiduciary duties, aiding and abetting fiduciary breaches, and...

In S. California Darts Ass'n v. Zaffina (2014 WL 3893093), the 9th Circuit held that a delinquent corporation with unregistered marks could maintain a claim for trademark infringement under the Lanham Act (15 U.S.C. §1125). Since the 1960s, the Southern California Darts Association (SoCal) promoted competitive darts.  Throughout that time the...

The Plaintiff in Galen v. Redfin Corp. (227 Cal.App.4th 1525) attempted to avoid contractual arbitration, arguing that Labor Code violations were statute-based and outside of the contract scope. Galen had entered into an employment agreement with Redfin as a real estate broker.  The agreement classified Galen as an independent...

The defendant employer in Knutsson v. KTLA, LLC (228 Cal.App.4th 1118) incorrectly moved to compel arbitration under the employment agreement it had with the plaintiff employee.  Although the provisions provided for arbitration, conditions precedent to arbitration had not been met. The Plaintiff, Knutsson, established...

Plaintiffs in Minter v. Wells Fargo Bank N.A. (2014 WL 3827671) brought a class action suit against the bank and an associated real estate company (collectively, “defendants”) for various violations of RESPA Section 8 (12 U.S.C. §2607).  The Plaintiffs alleged the Defendants created a sham Mortgage Company, Prosperity Mortgage Co.,...

In MHC Mut. Conversion Fund, L.P. v. Sandler O'Neill & Partners, L.P. (2014 WL 3765717) the Tenth Circuit maintained narrow liability under section 11 (15 U.S.C. 77k) of the Securities Act, for opinion statements concerning future events by a securities issuer. This case arose after the 2008 financial crisis. Bancorp issued a...

In Loos v. Immersion Corp. (2014 WL 3866084), the Plaintiff appealed the district court’s dismissal of his securities fraud class action for failure to state a claim. Initially, Immersion had failed to turn a profit. After a recovering a significant patent infringement claim, Immersion reinvested and reported profits throughout 2007....

The California Court of Appeals recently held that Labor Code §2802 requires employers to reimburse employees obligated to use personal cell phones for work-related calls. In Cochran v. Schwan’s Home Service, Inc.(2014 WL 3965240), the plaintiff filed a class action suit against Schwan’s on behalf of a group of managers seeking...

A federal court made it more difficult for derivative plaintiffs and their lawyers to cheaply exit derivative lawsuits they brought but no longer wish to maintain.  In June 2013, the Delaware Chancery Court dismissed stockholder claims challenging the validity of a forum-selection bylaw adopted by Chevron’s directors (Boilermakers Local 154...

A recent case provides important clarity as to whether a person or entity is entitled to a Financial Industry Regulatory Authority (FINRA) arbitration.  While the particular facts of the case are somewhat unique, the Second Circuit established a test for determining who exactly is a "customer" of a FINRA member entitled to arbitrate....

In George K. Baum & Co. v. Twin City Fire Ins. Co. (2014 WL 3445713), Plaintiff Baum sold and underwrote municipal bonds incorrectly claimed to be tax exempt. When the IRS notified Baum of a pending investigation, Baum relayed the information to its insured, Twin City. Years later, derivative suits were filed but Baum failed to...

In Opalinski v. Robert Half International, Inc. (2014 WL 3733685), the Third Circuit addressed preliminary jurisdiction in determining the availability of class arbitration under the Federal Arbitration Act (9 U.S.C. §1). The plaintiffs alleged that RHI violated wage and classification laws of the Fair Labor Standards Act. The...

The Truth in Lending Act provides rescission as a remedy for obligors subject to lender loan disclosure violations. Under 15 U.S.C. §1635(a), the right is available until midnight of the third day after closing or after delivery of the lending documents and rescission forms required under TILA; at the latest, the right expires after three years....