Posts in Shareholder Actions
U.S. District Court Denies Motion to Dismiss for Securities Fraud Action: Wins Used False Headquarters to get onto the Russell Index

In Desta v. Wins Fin. Holdings Inc. Et. Al., No. 17-cv-02983-CAS(AGRx), 2018 BL 70590 (C.D. Cal. Feb. 28, 2018), the United States District Court for the Central District of California denied Wins Finance Holdings Inc. (“Wins”), and Wins Co-CEO Jianming Hao, Co-CEO and COO Renhui Mu, and CFO Junfeng Zhao’s, (collectively the “Defendants”) motion to dismiss Michael Desta’s (“Plaintiff”) complaint for failure to state a claim for securities fraud pursuant to Section 10(b) of the Securities Exchange Act, 15 U.S.C. § 78j(b), and Rules 10b– 5(a) and (c) under, 17 C.F.R. § 240.10b–5(a) & (c). The court held that the Plaintiff alleged sufficient facts to show the elements of falsity, scienter, loss causation, and reliance under the Act, such that a proper claim was pleaded.

Read More
City Trading Fund v. Nye: Approval of Settlement Denied When Terms of Disclosure-Only Settlement Made Company and Its Shareholders Net Losers.

In City Trading Fund v. Nye, 2018 BL 44689, (Sup. Ct. Feb. 08, 2018), the Supreme Court of New York denied City Trading Fund’s (“Shareholder”) motion, on behalf of themselves and other similarly situated stockholders, for final approval of their settlement with Martin Marietta Materials, Inc. (“Company”), the Company’s individually named directors, and Texas Industries, Inc. (“Texas Industries”), after the Shareholder alleged the Company breached its fiduciary duties to stockholders by making material misstatements and omissions in the proxy materials provided to stockholders in preparation for a vote on the Company’s proposed merger with Texas Industries.

Read More
Hawkins v. Borsy: Court Finds It Does Not Have Proper Subject Matter Jurisdiction

In Hawkins v. Borsy, No. 1:05-cv-1256–LMB-JFA, 2018 WL 793599 (E.D. Va. Feb. 8, 2018), the United States District Court for the Eastern District of Virginia granted corporate affiliates (“Respondents”) of MediaTechnik Kft. (“MediaTechnik”) motion to vacate, the district court’s decision granting William Hawkins (“Hawkins”), Eric Keller, Thomas Zato, Kristof Gabor, and Justin Panchley (collectively, “Plaintiffs”) default judgment against Laszlo Borsy (“Borsy”), Mediaware Corporation (“Mediaware”), MediaTechnik, i-TV, and Peterfia Kft. (“Peterfia”) (collectively, “Defendants”) for lack of subject matter jurisdiction.

Read More
In re Psychemedics Corp. Securities Litigation: Plaintiffs Failed to Sufficiently Allege Claims Based on Violations of the FCPA

In In re Psychemedics Corp. Securities Litigation, No. 17-cv-10186-RGS, 2017 BL 399136 (D. Mass. Nov. 07, 2017), the United States District Court for the District of Massachusetts granted Psychemedics Corp. (“Psychemedics”) and Raymond Kubacki’s (“Kubacki”), Psychemedics’ Chief Executive Officer, (collectively, “Defendants”) motion to dismiss for failure to state a claim in a putative class action brought by Mary Kathleen Hermann on behalf of all of those who purchased Psychemedics common stock between February 10, 2014 and January 31, 2017 (collectively, “Plaintiffs”). Based on Plaintiffs’ failure to allege facts sufficient to support an inference of scienter, the court granted dismissal of the claims alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934.

Read More
Southern District of New York Dismisses Securities Fraud Claims Against Horizon Pharma

In Schaffer, et al. v. Horizon Pharma PLC, et al., No. 16-CV-1763 (JMF), 2018 BL 16225 (S.D.N.Y. Jan. 18, 2018), the Southern District of New York dismissed the claims brought by a class of plaintiffs (“Plaintiffs”) against Horizon Pharma PLC (“Horizon”), a number of Horizon’s executives (“Individual Defendants”), and various underwriters (Horizon, Individual Defendants and the underwriters, collectively “Defendants”). The complaint alleged Horizon and Individual Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (“Exchange Act”) and Rule 10b-5 thereunder, and Defendants violated Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, as amended (“Securities Act”). The court held Plaintiffs’ complaint only gave conclusory statements and insufficient facts to establish securities fraud or scienter and dismissed the complaint.

Read More
City of Hialeah Employees' Retirement System v. FEI: Defendants' Motion to Dismiss Plaintiff's Second Amended Complaint Granted

In City of Hialeah Employees' Retirement System v. FEI, No. 3-16-cv-1792-SI, 2018 BL 25615 (D. Or. Jan. 25, 2018), the United States District Court for the District of Oregon granted a motion to dismiss the City of Hialeah Employees’ Retirement System’s (“Plaintiff”) Second Amended Complaint (“SAC”), filed against FEI Company ("FEI"), Thermo Fisher Scientific Inc. ("Thermo"), and named Individual Defendants, Thomas Kelly, Donald Kania, Homa Bahrami, Arie Huijser, Jan Lobbezoo, Jami Dover Nachstsheim, James Richardson, and Richard Wills (collectively, "Defendants"), finding Plaintiff failed to adequately plead that Defendants’ violated Section14(a) of the Securities Exchange Act of 1934 (“Exchange Act”) and that Individual Defendants violated Section 20(a) of the Exchange Act. 

Read More