Justia Corporate Compliance Opinion Summaries

This case arose when Commerzbank agreed to acquire Dresdner Bank in September 2008. As part of the deal, Commerzbank also acquired Dresdner Bank's trust preferred structures, and holders of Dresdner's trust preferred securities received distributions in both 2009 and 2010. Plaintiff claimed that paying those distributions "pushed," or required Commerzbank to make distributions on, a class of its owned preferred securities in which plaintiff had an interest, and, by the complaint, plaintiff asked the court to enforce that alleged obligation. Plaintiff also sought specific performance of a support agreement that was argued to require the elevation of the liquidation preference of Commerzbank's trust preferred securities in response to a restructuring of one class of the Dresdner securities. The parties filed cross-motions for summary judgment. The court held, among other things, that because the DresCap Trust Certificates did not qualify as either Parity Securities, defendants were entitled to judgment in their favor as a matter of law regarding plaintiff's claim under the Pusher Provision. The court also held that because DresCap Trust Certificates did not qualify as either Parity Securities or Junior Securities, Section 6 of the Support Undertaking was not triggered by amendment of the DresCap Trust IV Certificates. Accordingly, defendants were entitled to judgment in their favor as a matter of law regarding plaintiff's claim that the amendment of the DresCap Trust IV Certificates required defendants to amend the Trusted Preferred Securities.View "The Bank of New York Mellon v. Commerzbank Capital Funding Trust II, et al." on Justia Law

The City of New York sued defendants under federal and New York State antitrust laws, seeking to prevent the companies from merging. The city appealed from a judgment of the district court granting summary judgment to defendants and dismissing the city's complaint without leave to amend. The court agreed with the district court that the alleged relevant market definition, as the "low-cost municipal health benefits market[,]" was legally deficient and concluded that the district court's denial of leave to amend was not an abuse of discretion. Accordingly, the court affirmed the judgement of the district court. View "City of New York v. Group Health Inc., et al." on Justia Law

FICO brought suit against three credit bureaus: Experian, Equifax, and Trans Union, as well as against VantageScore, the credit bureaus' joint venture. The suit alleged antitrust, trademark infringement, false-advertising, and other claims. FICO, Experian, and VantageScore appealed from the district court's judgment. The court held that FICO failed to demonstrate that it had suffered any antitrust injury that would entitle it to seek damages under section 4 of the Clayton Act, 15 U.S.C. 12-27, and FICO failed to demonstrate the threat of an immediate injury that might support injunctive relief under section 16. The court also held that there was no genuine issue of material fact that consumers in this market immediately understood "300-850" to describe the qualities and characteristics of FICO's credit score and therefore, the district court did not err in finding the mark to be merely descriptive. The court further held that there was sufficient evidence for a reasonable jury to determine that the U.S. Patent and Trademark Office (PTO) relied on FICO's false representation in deciding whether to issue the "300-850" trademark registration. The court agreed with the district court that VantageScore was not a licensee and therefore was not estopped from challenging the mark under either theory of agency or equity. The court finally held that FICO's false advertising claims were properly dismissed and the district court did not abuse its discretion in denying the motion for attorneys' fees. View "Fair Isaac Corp., et al. v. Experian Information Solutions, et al." on Justia Law

Plaintiffs, shareholders of Ness Technologies, Inc. (Ness), moved to expedite proceedings in this putative class action, which they filed to enjoin a proposed transaction through which Ness's largest shareholder, Citi Venture Capital International (CVCI), would, through a wholly owned subsidiary, acquire Ness in a cash transaction at $7.75 per share (Proposed Transaction). Plaintiffs contended that the Proposed Transaction was the product of a flawed sales process and that the members of the Board, aided and abetted by CVCI, breached their fiduciary duties to plaintiffs and the class by approving the transaction. Plaintiffs asserted both price and process claims and claims that the Board's disclosures regarding the Proposed Transaction were inadequate. The court held that plaintiffs' Motion for Expedited Proceedings was granted only to the extent that they could take expedited, but necessarily limited and focused, discovery regarding the question of whether either the Board's or the Special Committee's financial advisors were conflicted because of their relationships with CVCI. The motion was denied in all other aspects. View "In re Ness Technologies, Inc. Shareholders Litigation" on Justia Law

Intercontinental Exchange, Inc. and the Board of Trade of the City of New York, Inc. (collectively, defendants), merged in 2007. Plaintiff was a member of the Board of Trade before the merger and the merger agreement required that if a member, including plaintiff, wished to continue in the newly merged enterprise, the member had to submit an Election Form specifying that preference by a stated deadline. Plaintiff did not receive the Election Form until after the deadline had passed and thereafter, defendants learned that many members, including plaintiff, had failed to submit the Election Form. Defendants waived the deadline and then, in an ad hoc manner and without notice to any member, imposed a new deadline. Defendants subsequently decided that plaintiff's Form was untimely and, of all the post-deadline-filled Forms, plaintiff's Form was the only one that defendants deemed untimely and refused to honor. Thereafter, plaintiff filed an action alleging breach of contract and the Court of Chancery ruled in favor of defendants. The court concluded, however, that defendants waived the initial deadline and also failed to retract that waiver by providing reasonable notice of their new deadline. Because the retraction of the waiver was invalid as a matter of law, plaintiff's Election Form was timely. Accordingly, the judgment of the Court of Chancery was reversed and the matter remanded for further proceedings. View "Amirsaleh v. Bd of Trade of the City of New York Inc., et al." on Justia Law

The bankruptcy court issued an order that authorized the debtor to reimburse qualified bidders for expenses incurred in connection with the sale of a substantial asset of the debtor's estate. Debtor and debtor's parent companies subsequently appealed the bankruptcy court's reimbursement order. As a preliminary matter, the court held that it had jurisdiction over the appeal where, in settling this "discrete dispute," the reimbursement order was sufficiently separable from the rest of the bankruptcy proceeding to be appealable as a "final" order under 28 U.S.C. 158(a) and (d). The court also held that, based on the record, the bankruptcy court did not err in issuing the reimbursement order under the business judgment standard in section 363(b) of the Bankruptcy Code. Accordingly, the judgment of the district court was affirmed. View "ASARCO, Inc., et al. v. Elliot Mgmt., et al." on Justia Law

This case arose out of a sale-leaseback transaction that occurred in 2001. On July 10, 2011, the seller-lessees' parent company announced plans for a proposed transaction whereby it would seek a new credit facility and undergo an internal reorganization. As part of a subsequent reorganization, substantially all of its profitable power generating facilities would be transferred from existing subsidiaries to new "bankruptcy remote" subsidiaries, except for two financially weakened power plants. On July, 22, 2011, plaintiffs brought this action seeking to temporarily restrain the closing of the proposed transaction on the grounds that it violated the successor obligor provisions of the guaranties and would constitute a fraudulent transfer. The court found it more appropriate to analyze plaintiffs' motion for a temporary restraining order under the heightened standard for a preliminary injunction. Having considered the record, the court held that plaintiffs have failed to show either a probability of success on the merits of their breach of contract and fraudulent transfer claims or the existence of imminent irreparable harm if the transaction was not enjoined. Therefore, the court denied plaintiffs' application for injunctive relief. View "Roseton Ol, LLC, et al. v. Dynegy Holdings Inc." on Justia Law

The Mississippi Public Employees' Retirement System filed a class action, claiming that senior management of a publicly traded manufacturer of medical devices in which it invested, withheld material information and made misleading statements about devices for treating coronary artery disease, in violation of the Securities Exchange Act of 1934, 15 U.S.C. 78j(b), 78t(a), and Securities Exchange Commission Rule 10b-5, 17 C.F.R. 240.10b-5. In an earlier opinion, the First Circuit reversed dismissal, finding that the inference of scienter advanced by the plaintiff was at least as cogent and compelling as the contrary inference, satisfying the "strong inference" pleading standard of the Private Securities Litigation Reform Act. After discovery, the district court entered summary judgment in favor of defendants. The First Circuit affirmed, finding that plaintiff did not produce evidence that would support a reasonable inference of scienter. Given the statements and disclosures that defendants did make concerning the devices, they had no obligation to disclose the fact that they were working on an improvement that would reduce the very small number of no-deflate complaints that they received, and of which the market was aware. View "MS Pub.Emps. Ret. Sys. v. Boston Scientific Corp." on Justia Law

This appeal arose from an earlier trial relating to the Enron scandal. The government alleged that Enron loaned out the stake in the barges that it owned off the Nigerian coast to Merill Lynch, risk-free and with a guaranteed return, but made it seem like a sale so that it could book a pretend profit. Defendant, a managing director at Merrill Lynch and the head of its Strategic Asset and Lease Finance group at the time of the transaction, challenged his convictions related to the sale on the grounds that the government violated his right to due process by withholding materially favorable evidence that it possessed pre-trial. The court affirmed and held that the district court did not clearly err in holding that the evidence at issue was not material. View "United States v. Brown" on Justia Law

Plaintiff brought this lawsuit to challenge the approximately $42.5 million acquisition of American Surgical Holdings, Inc. (American Surgical) by AH Holdings, Inc. Now before the court was plaintiff's interim application for an award of attorneys' fees and expenses where plaintiff contended that an award of $450,000 was appropriate under Delaware law and would compensate his attorneys for bringing this action, which he argued resulted in American Surgical's corrective disclosures in its definitive proxy statement. The court denied plaintiff's Interim Application for an Award of Attorneys' Fees and Expenses as it was premature where the amount of $450,000 was interim in nature because plaintiff's price and process claims remained viable. The court held that it would reconsider the application once plaintiff's remaining claims have been litigated. View "Frank v. Elgamal" on Justia Law