Westlaw Topical Highlights: Securities, April 3, 2014

April 3, 2014

To match analysis CHINA-IPO/Topical Highlights for Securities provides summaries of significant federal and state judicial decisions and legislative and administrative activities affecting Securities law. A Westlaw subscription is required to access the documents linked from this page.

Damages: Disgorgement and civil penalties were assessed against broker for aiding and abetting his employer’s fraud.  S.E.C. v. Tourre 2014 WL 969442 (S.D.N.Y.)  Disgorgement of a $175,463 portion of a broker’s $1,579,167 yearly bonus, plus pre-judgment interest of three percent on the amount, and civil penalties of $650,000, was appropriate, following a finding of the broker’s civil liability for violations of Section 10(b) and Rule 10b-5 of the Exchange Act and the anti-fraud provisions of the Securities Act. The disgorgement amount was reasonably attributable to the amount of the broker’s unjust enrichment, given that the fraudulent transaction at issue had been negotiated and closed during the year of his bonus, and the amount was based on the broker’s personal performance on the account, proportional to the time he had spent on the fraudulent transaction. The civil penalties award was based on three third-tier violations and four second-tier violations. 2014 WL 969442  (The full-text of the rest of the Topical Highlights is available within Westlaw Next, subscription required).

Fraud: Investors’ complaint alleging securities fraud did not adequately plead facts giving rise to strong inference of scienter.   Kuyat v. BioMimetic Therapeutics, Inc. 2014 WL 1259607 (C.A.6 (Tenn.))

Damages: Disgorgement and civil penalties were assessed against broker for aiding and abetting his employer’s fraud.  S.E.C. v. Tourre 2014 WL 969442 (S.D.N.Y.)

Arbitration: Forum-selection clause of broker-dealer agreement displaced FINRA arbitration.

Westlaw Topical Highlights Summary Added April 01, 2014 Citigroup Global Markets Inc. v. All Children’s Hosp., Inc. 2014 WL 1133401 (S.D.N.Y.)

Arbitration: Forum selection clause superseded default obligation of underwriter Rule to arbitrate.  Goldman, Sachs & Co. v. City of Reno 2014 WL 1272784 (C.A.9 (Nev.))

Brokers and Dealers: District court lacked subject matter jurisdiction over broker-dealer’s suit to enjoin SEC investigation.  Arjent LLC v. U.S. S.E.C. 2014 WL 1091201 (S.D.N.Y.)

Brokers and Dealers: Court did not have to approve compensation of SIPA trustee’s non-attorney professionals, even if payment was made from general SIPA estate.  In re MF Global Inc. 2014 WL 1153781 (Bkrtcy.S.D.N.Y.)