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Class Leads Picked For BofA-Merrill Buyout Battle

Thursday, Jul 02, 2009

A federal judge has divided 30 pending cases accusing Bank of America Corp. of misleading investors into signing off on its $50 billion acquisition of Merrill Lynch & Co. into three major groups — securities, derivatives and 401(k) plan claimants — and picked interim leads for the putative classes.

Insurance Regulator's Mizuho Suit Kept In Fed. Court

Thursday, Jul 02, 2009

A federal judge has ruled that the Pennsylvania insurance commissioner's office will have to pursue its case against Mizuho Corporate Bank Ltd. in federal court, in a suit over more than $9.2 million Reliance Insurance Co. transferred to Mizuho in the days before the insurance company went bust.

United Guaranty, Countrywide Suit Lands In Calif.

Thursday, Jul 02, 2009

Following a fierce jurisdictional showdown, a federal judge has ruled that the legal battle between American International Group Inc. unit United Guaranty Mortgage Indemnity Co. and Countrywide Bank FSB over mortgage insurance will be waged in a California federal district court.

Lehman Creditors Ask To Curb Probe Of Barclays Sale

Thursday, Jul 02, 2009

Concerned about costs, the official committee of unsecured creditors in the Lehman Brothers Holdings Inc. bankruptcy has asked a judge to direct an independent examiner investigating the sale of brokerage operations to Barclays Capital PLC to keep focused on narrow questions concerning the transaction.

Nadel Investors Defend Suit Against Holland & Knight

Thursday, Jul 02, 2009

Investors suing Holland & Knight LLP for allegedly preparing private placement memoranda used by Florida fund manager Arthur Nadel to operate a $400 million Ponzi scheme are defending their case against a motion to dismiss, while the firm has asked to stay discovery until that motion is resolved.

Accredited Home Sale To Vericrest Gets Judge's OK

Thursday, Jul 02, 2009

Over creditor objections, a judge has approved the controversial sale of the mortgage servicing platform of bankrupt Accredited Home Lenders Holding Co. to Vericrest Financial Inc.

WaMu, JPMorgan Still Fighting Discovery Battle

Thursday, Jul 02, 2009

Despite a bankruptcy judge's order greenlighting the request, Washington Mutual Inc.'s bid to get its hands on JPMorgan Chase & Co. records for evidence of sabotage continues, with WaMu now fighting the bank's request to have the order overturned.

UK Fund Group Wants Tighter Post-Madoff Rules

Wednesday, Jul 01, 2009

Europe's most powerful hedge fund industry group on Wednesday proposed new standards intended to establish more independent oversight and increased disclosure standards on its membership after the unraveling of Bernard L. Madoff's decades-long fraud.

Accredited Home Tries To Block Conversion To Ch. 7

Wednesday, Jul 01, 2009

Mortgage lender Accredited Home Lenders Holding Co. has balked at a bid by creditors — led by a unit of JPMorgan Chase & Co. — to convert its bankruptcy to Chapter 7, arguing that its liquidation plans have moved expeditiously and efficiently to eliminate significant expenses.

Stanford Financial Ex-CFO To Cop To Charges: Atty

Wednesday, Jul 01, 2009

Stanford Financial Group's former Chief Financial Officer James M. Davis will plead guilty to three criminal charges, including mail fraud and conspiracy to obstruct a U.S. Securities and Exchange Commission investigation, his attorney told Law360 on Wednesday.

Fund Adviser, Cuomo Settle Pension Probe For $2M

Wednesday, Jul 01, 2009

Pension fund adviser Pacific Corporate Group Holdings LLC will adopt New York Attorney General Andrew Cuomo’s Public Pension Fund Code of Conduct, and an affiliate will return over $2 million to a state retirement fund, in a deal that ends the affiliate's involvement in Cuomo's pay-to-play corruption probe.

Trial Ordered Over JPMorgan Role In Enron Dispute

Wednesday, Jul 01, 2009

A bankruptcy judge has called for a trial to determine the exact role J.P. Morgan Securities Inc. played in a complex web of big-dollar commercial paper transactions between Enron Corp. and other entities in the months leading up to the energy giant's dramatic 2001 collapse.

Adelphia Trust Must Produce Deloitte Suit Testimony

Wednesday, Jul 01, 2009

A federal judge has ordered creditors of collapsed telecommunications giant Adelphia Communications Corp. to turn over expert reports from an old malpractice case against Deloitte & Touche to a group of banks, including Citigroup Inc., Deutsche Bank AG and Bank of America Corp., which the creditors are suing for fraud.

Stranger-Owned Insurance Scheme Cases Sent To Fla.

Wednesday, Jul 01, 2009

A federal judge in Texas has cited the “first-to-file” rule in transferring eight consolidated cases to Florida, where West Coast Life Insurance Co. will duke it out with Wells Fargo & Co. over an alleged stranger-owned life insurance scheme.

Britain Seizes $100M In Stanford-Related Funds

Tuesday, Jun 30, 2009

At the behest of the U.S. Department of Justice, the U.K. has frozen $100 million connected to a $7 billion fraud scheme purportedly engineered by billionaire financier Robert Allen Stanford.

SEC, Former Putnam Exec Settle $4M Fraud Case

Tuesday, Jun 30, 2009

The U.S. Securities and Exchange Commission has settled its case against the last of six former Putnam Fiduciary Trust Co. executives accused of cheating clients out of $4 million in 2001 to cover up an error.

Plaintiffs Drop Antitrust Suit Over G-Fees

Tuesday, Jun 30, 2009

A proposed class of plaintiffs has dropped its lawsuit accusing Fannie Mae and Freddie Mac of collaborating, instead of competing, when setting guarantee fees associated with backstopping against loan defaults.

FINRA Eyes Muni Bond Market

Tuesday, Jun 30, 2009

The Financial Industry Regulatory Authority said Tuesday it had launched an initiative to survey practices in the municipal securities market and promote investor protection.

Madoff's Merkin To Part With $310M Art Trove

Tuesday, Jun 30, 2009

As the walls close in, J. Ezra Merkin, the former hedge fund heavyweight accused of funneling billions to Madoff’s Ponzi scheme, will not find escape in his prized artworks, having agreed to sell the $310 million collection for potential restitution to defrauded clients.

Judge Rules Stanford Must Await Trial In Jail

Tuesday, Jun 30, 2009

A federal judge has ruled that billionaire financier Robert Allen Stanford must stay in jail until he stands trial for allegedly running a $7 billion Ponzi scheme, reversing an order last week that granted Stanford release on a $500,000 bail.


Guest Columns

Enabling State Suits Against National Banks

While Cuomo v. The Clearing House Association and Office of the Comptroller of Currency opens the door for more litigation by states, it does not permit fishing expeditions. States can seek information from national banks through courts, but they must have a basis for thinking there is wrongdoing, say L. Richard Fischer, James R. McGuire and Seth M. Galanter of Morrison & Foerster LLP.

Debate Brews Over Obama Regulatory Reform Plan

The Obama administration's release of its financial regulatory plan sets the stage for a broad range of conflicts among and between many business interests, as well as federal and state regulators. It also signals the beginning of a long debate between well-entrenched constituencies, say Thomas Vartanian, David L. Ansell, Robert H. Ledig and Gordon Miller of Fried Frank Harris Shriver & Jacobson LLP.

New York — The Creditor's Playground

The highest court in the state of New York has just issued a holding that may effectively make the courts in New York the collection agency against almost any debtor that does not have all its assets hidden under its mattress, says Jeffrey E. Glen of Anderson Kill & Olick PC.

Unique Features Set NY Life Insurance Proposal Apart

The New York State Insurance Department recently issued proposed legislation regulating life settlements. While similar in many respects to laws adopted by other states, New York's proposed legislation contains certain unique features that make it particularly noteworthy, say Rachel B. Coan and Henry Bregstein of Katten Muchin Rosenman LLP.

Location: A Taxing Choice For New Businesses

The question of where to form a new business entity should not be taken lightly. Here are some of the pros and cons, from a tax perspective, of forming a new corporation, ab initio, outside the U.S., says Solomon Packer of accounting firm Marks Paneth & Shron LLP.

Making The Most Of Rule Of Evidence 502

It is foreseeable that, if used strategically, the new Federal Rule of Evidence 502 should alleviate the burdens of costly electronic discovery and post-production privilege review and should ultimately reduce the billions of dollars spent each year in litigation to protect against the inadvertent disclosure of privileged materials, says Otilia Gabor of Miles & Stockbridge PC.

Insight Into Assigning Arbitrability

The case of Monex Deposit Co. v. Gilliam begins to fill in a gap that California decisions have acknowledged in the debate over whether the court or the arbitrator should decide if an arbitration agreement is valid and enforceable, say Neil A. Goteiner, Frank J. Riebli and Scott Andrews of Farella Braun & Martel LLP.

MBS Litigation — Huge Exposure For Banks?

In most of the mortgage-backed securities cases filed between 2006 and 2008, it's only been in the last few months that plaintiffs lawyers have filed their true operative complaint. It's about to get interesting, say Neil McCarthy and Janet Rotter of Lawyer Links LLC.