Welcome to the 2014 Year-End Report from the BakerHostetler Securities Litigation and Regulatory Enforcement practice team. Its purpose is to provide a periodic survey, apart from our team Executive Alerts, on matters we believe to be of interest to sophisticated General Counsel, Chief Compliance Officers, Compliance Departments, legal departments, and members of the securities and commodities industries at financial institutions, private investment funds, and public companies.
We issue this Securities Litigation and Enforcement Highlights Report at mid-year and shortly after year-end. We hope you find the information and commentary useful and welcome your comments and suggestions. We encourage you to contact any of the practice team members listed at the end of the Report.
This Report highlights recent significant developments in:
- Supreme Court cases, including the United States Supreme Court dismissal of the writ of certiorari in Public Employees' Retirement System of Mississippi v. IndyMac MBS, Inc. and its review of the scope of Section 11 of the Securities Act of 1933 (Securities Act);
- Securities law cases, including the United States Court of Appeals for the Second Circuit's application of Morrison to whistleblower anti-retaliation provisions and liability under Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and the United States Court of Appeals for the Ninth Circuit's decisions regarding the pleading standard for loss causation;
- Insider trading cases, including the impact of the Second Circuit's decision in United States v. Newman and the United States Securities and Exchange Commission's (SEC) use of administrative proceedings for insider trading enforcement actions;
- Civil and regulatory settlements, including the historic billion dollar settlements by Citigroup and Bank of America related to their conduct prior to the Financial Crisis of 2008;
- Investment adviser and hedge fund cases, including enforcement actions relating to misappropriation of client assets, improper disclosures, and high-frequency trading;
- Commodities and futures regulation and cases, including settlements of manipulation cases relating to foreign exchange rates (FX) and the London Interbank Offered Rates (LIBOR);
- Securities policy and regulatory developments, including the adoption of rules by the SEC relating to money market funds, credit agencies, and the technology infrastructure of the United States securities markets; and
- The SEC's Cooperation Program, including the first settlements pursuant to the Municipalities Continuing Disclosure Cooperation Initiative (MCDC Initiative) and several settlements reflecting significant cooperation credit in the form of reduced civil penalties.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.