On July 9, the Securities and Exchange Commission settled with two stock promoters accused of reaping $2.5 million in illicit profits by manipulating stocks of medical marijuana microcap companies.
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Michael S. Gordon
SEC Brings Complaint in $68 Million Affinity Fraud Scheme
By Michael S. Gordon & Margaret J. McQuade on
Posted in Litigation
On July 6, the Securities and Exchange Commission filed a complaint in connection with a $68 million affinity fraud scheme allegedly orchestrated by Bingqing Yang, through her wholly owned management companies, Luca International Group, LLC, Luca Resources Group, LLC and Luca Energy Fund, LLC (collectively, Luca Managers), with the help of Ms. Yang’s chief fundraiser, Lei Lei.
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CFTC Sues Chinese Citizen Accused of Executing Fraudulent Money Pass Trades
By Michael S. Gordon & Zachary Denver on
Posted in Litigation
The Commodity Futures Trading Commission recently sued Chinese citizen Yumin Li, for violations of the Commodity Exchange Act (CEA).
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Seventh Circuit Holds Under Indiana Law, Company Was Allowed to Vote Its Own Shares
By Michael S. Gordon & Zachary Denver on
Posted in Litigation
The United States Court of Appeals for the Seventh Circuit recently affirmed a district court decision holding that under Indiana law, an Indiana corporation could vote its own outstanding preferred shares.
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Tenth Circuit Affirms Clawback From Unsuspecting Recipient of Funds Under Uniform Fraudulent Transfer Act
By Michael S. Gordon & Tenley Mochizuki on
Posted in Litigation
The US Court of Appeals for the Tenth Circuit recently upheld the grant of summary judgment for the receiver of a business that was alleged to have participated in a Ponzi scheme, finding that the clawback of funds was appropriate even from a recipient who was unaware of the fraud.
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Senator Elizabeth Warren Criticizes SEC Chair Mary Jo White for “Extremely Disappointing” Leadership
By Michael S. Gordon & Tenley Mochizuki on
Posted in Litigation
In a letter dated June 2, 2015, Senator Elizabeth Warren described several “promises” that Mary Jo White, chair of the Securities and Exchange Commission, had allegedly broken. Senator Warren focused on (1) the SEC’s failure to finalize Dodd-Frank rules requiring disclosure of the ratio of CEO pay to that of the median worker; (2) settlement …
Ninth Circuit Honors Canadian Business Law’s Exclusive Remedy Provision
By Michael S. Gordon & Tenley Mochizuki on
Posted in Litigation
The US Court of Appeals for the Ninth Circuit recently affirmed dismissal of a counterclaim for breach of fiduciary duty brought under Section 242 of the Alberta Business Corporations Act (ABCA), finding that only an Alberta court could provide the remedy provided by the ABCA, and thus the counterclaim failed to state a claim upon which relief could be granted.
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Delaware Court of Chancery Holds Forum Selection Clause Trumps Prior-Filed Action Doctrine
By Michael S. Gordon & Tenley Mochizuki on
Posted in Litigation
The Delaware Court of Chancery recently upheld a non-exclusive forum selection clause and denied a motion to dismiss despite a prior-filed action pending in a different state based on largely the same claims.
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Fourth Circuit Sustains Securities Fraud Claim Against Drug Manufacturer
By Michael S. Gordon on
Posted in Litigation
On March 6, the US Court of Appeals for the Fourth Circuit found that the United States District Court for the Western District of North Carolina had erred in dismissing a class action lawsuit filed under Section 10(b) of the Securities Exchange Act of 1934 (Exchange Act) because the lower court had inappropriately relied on …
Software Company to Face Suit Over Contract Restructuring
By Michael S. Gordon on
Posted in Litigation
The United States District Court for the Northern District of California sustained a securities fraud complaint alleging that the defendants, a software company and its executives, had defrauded investors by failing to disclose that the company had systematically restructured contracts with its customers for the purpose of accelerating revenue recognition.
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