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We have all seen the various league tables showing which plaintiffs’ firms have had the highest average securities class action settlements. But do these firms wind up at the top of the tables because they produce better outcomes for the plaintiff class, or do they produce these results simply because they are better at winning the race to become lead counsel in the better cases? As three academics put it in their recent paper, “do the plaintiffs’ lawyers matter”? In their paper, New York Law Professor Stephen J. Choi, University of Richmond Law Professor Jessica M. Erickson, and University of Michigan Law Professor Adam C. Pritchard survey securities class action lawsuit settlements in order to determine whether the “top tier” plaintiffs’ firms actually produce better outcomes for the plaintiff class. Interestingly, the authors conclude that while the top firms produce better outcomes in a narrow subset of cases, in most other cases…
Author: Kevin LaCroix
Posted: March 18, 2024, 7:54 pm
 On 18 March 2024, the Council of the EU adopted a draft Regulation to protect the wholesale energy market against market manipulation. The draft Regulation will reinforce market surveillance in the European Union and ensure open and fair competition in the wholesale energy markets. This forms part of the EU’s wider electricity market design and amends Regulation (EU) No 1227/2011 (the REMIT Regulation) and the Regulation on the establishment of the European Union Agency for the Cooperation of Energy Regulators (ACER), Regulation (EU) No 2019/942. The draft Regulation was presented by the European Commission on 14 March 2023 as a response to the high and volatile energy prices in 2022. As such, the draft Regulation sets the basis for increased market transparency and integrity and aims to enhance the public’s trust in the functioning of wholesale energy markets. It aims to create clearer and stricter requirements for market participants in the EU who are…
Author: Simon Lovegrove (UK)
Posted: March 18, 2024, 6:40 pm
On 18 March 2024, the Investment Association (IA) published a guide ‘Operational resilience: severe but plausible (SBP) scenarios’. The guide directly builds upon the IA’s previous member guidance on scenario testing from December 2021 and this new guide represents the IA’s continued contribution to building a common understanding and establishing best practice with regard to severe but plausible scenarios and operational resilience. The purpose of the guide is to: Address some of the ambiguity surrounding the SBP concept, helping to make operational resilience policy clearer to understand, and potentially, lead to more effective implementation. Identify best practices in calibrating SBP scenarios. Provide baseline information that firms can use as a starting point to calibrate SBP scenarios appropriate for their own businesses, accompanied by supporting guidance and considerations to be thought through. Build a common understanding of the factors and…
Author: Simon Lovegrove (UK) and Anita Edwards
Posted: March 18, 2024, 6:36 pm
On 18 March 2024, the Financial Stability Board (FSB) published a revised version of its 2016 guidance on arrangements to support operational continuity in resolution. The 2016 guidance assists supervisory and resolution authorities, and financial institutions to evaluate whether financial institutions that are subject to resolution planning requirements have appropriate arrangements to support operational continuity if they enter resolution. The FSB has now updated the 2016 guidance by adding as an addendum a supplementary note on the digitalisation of critical shared services. The FSB has done this in light of financial institutions increasing their dependency on third-party service providers in supporting critical shared services. This can bring benefits but, if not properly managed, disruption to critical shared services could affect the continued provision of critical functions, posing risks to orderly resolution and, in some cases, financial stability.
Author: Simon Lovegrove (UK)
Posted: March 18, 2024, 6:31 pm
Overview In private M&A transactions, earnouts provide sellers with an opportunity to receive one or more post-closing payments upon the achievement of certain financial targets and/or operational milestones, helping to bridge the gap when the buyer and seller cannot agree on the value of the target business. In recent years, with high-interest rates, reduced access to debt financing, and concerns about future growth opportunities, earnouts have helped parties get deals to the finish line. Despite their utility, earnouts must be carefully negotiated and drafted to reduce the likelihood of future disputes and thwarted expectations, particularly in cases tied to bottom-line results, complex calculations, and/or when the target company is being integrated into the buyer’s other businesses. While this article focuses on certain pitfalls of earnouts from the seller’s perspective, the issues it raises are instructive for buyers as well. Calculation…
Author: Michael Pass
Posted: March 18, 2024, 4:55 pm
The latest $1.25 million award from the Commodities Futures Trading Commission (CFTC) goes to a whistleblower who first reported misconduct internally to their employer, who then ignored the report. Following 120 days of the company’s inaction, the individual submitted the information to the CFTC, who immediately opened an investigation. As part of the CFTC’s “safe harbor” rule, the whistleblower must wait 120 days after reporting internally before submitting information. This is the first time the CFTC’s 120-day “safe harbor” provision has applied to a whistleblower who worked in an auditing or internal compliance capacity. Individuals in these positions have more stringent requirements. This whistleblower complied with those requirements when reporting. The information from the whistleblower was original and given voluntarily. It was the only reason the CFTC opened its investigation. The information “was quite…
Author: Silver Law Group
Posted: March 18, 2024, 2:11 pm
By John Filar AtwoodThe CFTC has awarded $1.25 million to a whistleblower whose responsibilities included compliance or internal audit functions at the subject company. Stricter whistleblower requirements apply to employees with compliance or internal audit responsibilities, but the CFTC said that the whistleblower satisfied those requirements by first raising the matter internally and then waiting at least 120 days to contact the agency.It is the first CFTC whistleblower award that applied the 120-day safe harbor provision to a person who served in an entity’s internal compliance or audit function. The whistleblower contacted the CFTC only after the employer took no meaningful remedial action on the issues in question.In its order, the CFTC noted that it normally does not consider information that a whistleblower obtains from his or her role as an internal audit or compliance employee to be derived from his or her independent knowledge. However, the exclusion from…
Author: Unknown
Posted: March 18, 2024, 12:51 pm
The Securities and Exchange Commission today announced settled charges against two investment advisers, Delphia (USA) Inc. and Global Predictions Inc., for making false and misleading statements about their purported use of artificial intelligence (AI).…Read the Full Press Release Have a securities law question? Call New York Securities Lawyers at 212-509-6544.
Author: Mark Astarita
Posted: March 18, 2024, 12:06 pm
As we have chronicled in this blog and on PracticalESG.com, a number of lawsuits seeking to challenge the SEC’s climate disclosure rules have been filed in the week and half since the SEC adopted the rules on March 6. To date, litigation challenging the rules has been filed in four federal courts of appeals, including the U.S. Court of Appeals for the Fifth, Sixth, Eight and Eleventh Circuits. There is no doubt that additional lawsuits will continue to be filed. In the Fifth Circuit, the petitioners Liberty Energy Inc. and Nomad Proppant Services LLC filed a motion seeking an administrative stay and stay pending judicial review. The petitioners indicated that they would be “irreparably harmed” by the failure to grant a stay because the disclosures that will be first required in 2026 must include data collected in 2025 and companies are implementing systems to prepare the required disclosure. The SEC opposed this motion, but on Friday, March 15, the three judge…
Author: David Lynn
Posted: March 18, 2024, 11:15 am
Those who follow the ups and downs of SEC rulemaking will no doubt note that it was the Fifth Circuit Court of Appeals which vacated the SEC’s share repurchase disclosure rules late last year, based on a determination that the SEC acted arbitrarily and capriciously, in violation of the Administrative Procedure Act, when the SEC failed to respond to petitioners’ comments and failed to conduct a proper cost-benefit analysis. As you may recall, that litigation in the Fifth Circuit moved very quickly from adoption of the final rules in May 2023 to an order by the court directing the SEC to address the petitioners’ claims by October 2023, ultimately resulting in vacatur when the agency failed to timely respond to the court’s October order. I think everyone was surprised by the sheer speed with which the court acted in the case of the share repurchase rules, having observed litigation over SEC rulemaking plod through the courts for years in many cases (for…
Author: David Lynn
Posted: March 18, 2024, 11:10 am
All of this talk about climate this morning has got me thinking about Spring, which begins tomorrow with the advent of the vernal equinox. While I have always been pretty much an Autumn kind of guy, over the years I have come to really appreciate Spring, particularly as my tolerance for Winter has significantly waned. I was away from home dealing with a family emergency since Thursday of last week, and I was pleasantly surprised to come home yesterday and see how many plants in my yard had bloomed over just those few days that I was away. So on the first day of Spring tomorrow, I encourage you to get out and enjoy the climate, without worrying about what you may have to disclose about it in your SEC reports! – Dave Lynn
Author: David Lynn
Posted: March 18, 2024, 11:05 am
On 11 March 2024, the Eurogroup (in inclusive format, meaning that all EU finance ministers are included) published a statement on the future of the Capital Markets Union (CMU). The statement provides an overview of EU finance ministers’ common priorities for the future of the CMU. The introduction of the statement describes the current lack of non-bank funding, the growing lack of competitiveness of the EU capital markets, as well as the lack of a deep and well-functioning market for risk capital in Europe. Following the introduction, EU finance ministers set out a list of priority areas for the European Commission (Commission) to act on during its next term, which will start in 2024 and end in 2029. These areas are grouped under three main themes: architecture, business, and citizens. An overview of the main goals and actions are set out below. 1. Architecture. Member States aim to develop an agile capital markets framework allowing for a better cross-border…
Author: Flupke van den Bogart and Simon Lovegrove (UK)
Posted: March 18, 2024, 10:54 am
In early March, the FTC, DOJ & HHS announced a “cross-government public inquiry into private equity and other corporations’ increasing control over health care.” This Mayer Brown article says: The inquiry seeks to understand how private equity transactions in the healthcare field affect consolidation, as well as how such transactions affect patient health, worker safety, […]
Author: Meredith Ervine
Posted: March 18, 2024, 10:00 am
For Delaware, are the good times really over for good?  University of Virginia School of Law Professor Michal Barzuza fears that they might be in a recently posted a draft of her upcoming article entitled "Nevada v. Delaware: The New Market for Corporate Law".    Professor Barzuza analyzes Nevada corporate law, finding that it "poses insurmountable obstacles to shareholder litigation that function to diminish important pillars of Delaware corporate law".  She also considers Vice Chancellor J. Travis Laster's recent ruling in Palkon v. Maffeii, 2024 WL 678204 (Del. Ch. Feb. 20, 2024) and its implications.  Finally, she argues that increasing competition from Nevada and Texas could put pressure on Delaware to relax its own corporate law and that Nevada's protection of directors and officers could lessen the significance and importance of Delaware's judiciary.  Some might argue that Professor…
Posted: March 18, 2024, 7:15 am
The media often highlights hefty CEO compensation packages featuring lucrative stock grants, restricted shares, and stock options. The rationale for offering such equity-type compensation to top executives is to align the interests of managers and shareholders to mitigate agency conflicts between them. Otherwise, managers might deviate from optimal corporate strategies that maximize shareholder value. In addition to the agency conflict between shareholders and managers, firms face a conflict stemming from the divergent attitudes between shareholders and debtholders toward risk. Debtholders tend to be more risk averse due to concerns about a firm’s ability to fulfill its financial obligations, while shareholders often prefer riskier capital investments that maximize shareholder wealth. One method of mitigating this conflict is to supplement a manager’s compensation with debt-type compensation such as deferred compensation and pension benefits, collectively referred…
Author: renholding
Posted: March 18, 2024, 4:05 am
In October 2023, the FDIC proposed enforceable guidelines on corporate governance and risk management that would apply to all state non-member banks with $10 billion or more in assets. Key Facts: The comment period closed on February 9, 2024 66 comment letters were posted as of February 29, 2024 Of the 66 comment letters, 61 of them – over 92% – opposed the Proposal in its entirety or raised substantial concerns Criticism came from small and large banks alike, as well as government officials, state banking supervisors, trade organizations, advocacy groups and academics Only 5 comment letters – less than 8% of submissions – supported the Proposal Support came from academics and advocacy groups Opposition to proposal came from broad range of stakeholders A broad range of stakeholders opposed the proposal, including: ─ Conference of State Bank Supervisors ─ Council of Institutional Investors ─ National Association of Corporate…
Author: renholding
Posted: March 18, 2024, 4:01 am
The White Law Group reviews the regulatory history of Stifel Nicolaus & Co.   Stifel Nicolaus & Co Inc. (CRD # 793), a broker-dealer and investment banking firm, is headquartered in St. Louis, Missouri. The firm reportedly has $148 billion in assets under management and 2,992 advisors.  Stifel reportedly has 197 disclosure events on its broker record including 138 regulatory events, 2 civil events and 55 arbitrations, among others.  FINRA and the Securities and Exchange Commission may impose regulatory actions against a broker-dealer such as censures, fines, suspensions and restitution, among others. Regulatory actions can have serious consequences for a broker-dealer’s profile and reputation.  The following is a review of Stifel Nicolaus & Co. and its history of regulatory actions. Failure to Supervise March 18, 2024 – Stifel, Nicolaus & Company, Inc. has agreed to a settlement proposed by FINRA for alleged rule violations.…
Author: The White Law Group
Posted: March 18, 2024, 2:14 am
It is an idea that suddenly is all the rage – that companies should shake the Delaware dust off their feet and reincorporate elsewhere. Elon Musk has famously said, in the wake of the Delaware Chancery Court’s decision voiding his $55.8 billion pay package, that he will seek to reincorporate Tesla in Texas. (SpaceX, also a Musk company, has in fact already reincorporated in Texas.) The former Attorney General William Barr and another GOP official published a Wall Street Journal column arguing that Delaware’s courts are driving corporations away (as discussed here), and suggesting that companies increasingly will find it more attractive to be incorporated in Nevada or another state. Some companies have indeed left Delaware and reincorporated elsewhere – including not just SpaceX, but also TripAdvisor, for example. Why would a company change its state of incorporation from Delaware to another state? And with reference to the focus of  this blog, does…
Author: Kevin LaCroix
Posted: March 17, 2024, 5:58 pm
On 15 March 2024, the Financial Conduct Authority (FCA) announced a review into firms’ treatment of customers in vulnerable circumstances. The supports the FCA’s 2021 commitment. The announcement is in parallel with the Consumer Duty’s overarching objective, as firms are required to act to deliver good outcomes for all customers, including those with characteristics of vulnerability. The review will consider: Firms’ understanding of consumer needs. The skills and capability of staff. Product and service design. Communications and customer service. Whether these support the fair treatment of customers in vulnerable circumstances. The review will conduct consumer research to gather information from firms and consumer representatives to make this assessment. As opposed to conducting a separate piece of work focussed solely on age related issues (as initially indicated by the FCA in 2017), the review will look more broadly at how firms treat customers,…
Author: Anita Edwards, Simon Lovegrove (UK) and Matthew Gregory (UK)
Posted: March 15, 2024, 5:21 pm
On 15 March 2024, the European Supervisory Authorities (ESAs) published an updated version of their consolidated Q&As on the Packaged Retail and Insurance-based Investment Products (PRIIPs) Key Information Document. The document combines responses given by the European Commission to questions regarding interpretation of EU law according to Article 16(5) of the ESA Regulations, which are colour coded in blue, and responses generated by the ESAs relating to the practical application or implementation of the PRIIPs Regulation and its Delegated Acts under Article 16b(1) of the ESA Regulations, which are not colour coded. The following topics in the consolidated Q&As have been updated: ‘What is this product?’ section. Market risk assessment – product categories. Summary risk indicator. Performance scenarios. Past performance. Presentation of costs.
Author: Simon Lovegrove (UK)
Posted: March 15, 2024, 5:19 pm




Mark J. Astarita, Esq. is a securities lawyer who represents investors, financial professionals and firms in litigation, arbitration and regulatory matters across the country. He is a partner in the national securities law firm of Sallah Astarita & Cox, LLC and can be reached by email at mja@sallahlaw.com or by phone at 212-509-6544.

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Securities Attorney at Sallah Astarita & Cox | 212-509-6544 | mja@sallahlaw.com | Website | + posts

Mark Astarita is a nationally recognized securities attorney, who represents investors, financial professionals and firms in securities litigation, arbitration and regulatory matters, including SEC and FINRA investigations and enforcement proceedings.

He is a partner in the national securities law firm Sallah Astarita & Cox, LLC, and the founder of The Securities Law Home Page - SECLaw.com, which was one of the first legal topic sites on the Internet. It went online in 1995 and is updated daily with news, commentary and securities law related links.