Eversheds Sutherland 11th Circuit Business Blog
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Summary Judgment for Defendants Affirmed in Securities Fraud Case

In Whitehead v. BBVA Compass Bank, 2020 WL 6536897 (11th Cir. Nov. 6, 2020), the Eleventh Circuit affirmed summary judgment in favor of the defendant bank and bank officer on the plaintiff’s claims for securities fraud.  The plaintiff, an investor, claimed that the defendants wrongfully failed to inform him of the risks involved in acquiring a certain CD for his investment...

State Law Determines Whether Claim Brought Under Federal Statutory Law is Direct or Derivative

Federal courts should look to state law to decide whether a claim brought under a federal statute is direct or derivative, according to the Eleventh Circuit. The court addressed this issue for the first time in Freedman v. magicJack Vocaltec Ltd., 2020 WL 3467396 (11th Cir. June 25, 2020), a class action filed by a shareholder, alleging that the defendant corporation, magicJack, made...

Supreme Court to Rule on Securities Exchange Act Split Involving Eleventh Circuit

Earlier this month, the Supreme Court granted certiorari in Emulex Corp. v. Varjabedian, No. 18-459, 2019 WL 98542 (U.S. Jan. 4, 2019), in order to address a circuit split over Section 14(e) of the Securities Exchange Act, 15 U.S.C. § 78n(e), which addresses misstatements and omissions regarding tender offers.  Courts of Appeals disagree over whether the claims under the section...

Stock Issuer Not Required to Disclose Hiring of Outside Promoters

In the first published appellate court decision to decide the issue, the Eleventh Circuit has held that companies that retain promoters to publish promotional materials to “recommend” or “tout” their stock (and raise the stock price) are not required by federal securities laws to disclose the business arrangement between the issuing company and promoter.  In Ballesteros v. Galectin...

Ask Not for Whom the Securities Exchange Act’s Statute of Repose Tolls; It Doesn’t.

Is a statute of repose subject to tolling? Although its holding was limited to the applicability of American Pipe tolling, created by the commencement of a class action, to the five-year statute of repose under Section 20(a) of the Securities Exchange Act of 1934, the Eleventh Circuit discussed the issue in broad terms in its August 10 opinion in Dusek v. JPMorgan Chase & Co., 832...

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