Jonathan Richman
Partner
Jonathan Richman represents a variety of companies in securities class actions, shareholder derivative actions, internal investigations, SEC investigations, corporate governance, insider trading, D&O insurance and related matters. Many of those matters involve international elements, including representations of non-U.S. issuers in U.S. litigation and in landmark non-U.S. collective settlements under Dutch law in the Netherlands. Jonathan’s clients have included Hewlett Packard, Royal Dutch/Shell, Zurich Insurance Group, Halliburton, and Waste Management.
Jonathan writes extensively on topics ranging from securities and insider-trading law, corporate governance and fiduciary issues to non-U.S. law on collective actions. His articles have been published in major legal publications.
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A lot of ink has been spilled over the crime of insider trading, which – in the view of U.S. District Judge Jed Rakoff – “is a straightforward concept that some courts have managed to complicate.” In his recent decision in United States v. Pinto-Thomaz (S.D.N.Y. Dec. 6, 2018), Judge Rakoff attempts to simplify insider-trading law … Continue Reading
The Amsterdam Court of Appeal has approved a €1.3 billion collective settlement of claims asserted on behalf of shareholders of the former Fortis (now Ageas). The July 13, 2018 decision again shows that the Dutch Act on Collective Settlement of Mass Claims (the “WCAM”) can be used to resolve transnational disputes regardless of whether those claims could … Continue Reading
The Second Circuit confirmed this week that a “meaningfully close personal relationship” is not required for insider-trading liability where a tipper discloses inside information as a gift with the intent to benefit the tippee. The June 25, 2018 decision on panel rehearing in United States v. Martoma (No. 14-3599) retreats from the panel’s original decision and no longer … Continue Reading
The Supreme Court ruled today that, when a foreign government presents a formal submission to a federal court about the content of the government’s own laws, the court should accord “respectful consideration” to the government’s statements, but is not bound to grant them “conclusive effect.” The decision in Animal Science Products, Inc. v. Hebei Welcome … Continue Reading
The Supreme Court ruled today that judicially created principles that toll statutes of limitations for class members in timely filed class actions apply only to subsequently filed individual actions, not to follow-on class actions filed outside the limitations period. The decision in China Agritech, Inc. v. Resh (No. 17-432) thus eliminates the specter of a potentially … Continue Reading
On March 20, 2018, the Supreme Court ruled that the 1998 amendments to the federal securities laws did not strip state courts of jurisdiction over class actions alleging violations of only the Securities Act of 1933. The Court further held that those amendments do not empower defendants to remove those federal-law cases from state to … Continue Reading
The Fourth Circuit ruled yesterday that a plaintiff can sufficiently plead loss causation to establish a securities-fraud claim based on an “amalgam” of two theories: corrective disclosure, and materialization of a concealed risk. In so holding, the court concluded in Singer v. Reali that the issuer’s disclosure of a government subpoena and an analyst’s report discussing that … Continue Reading
On January 25, 2018, the Delaware Supreme Court held that the dismissal of a shareholder derivative action for lack of demand futility can preclude other derivative actions as long as the plaintiff in the dismissed case adequately represented the corporation’s interests. The Court’s decision in California State Teachers’ Retirement System v. Alvarez – a suit brought … Continue Reading
The Second Circuit ruled today that a “meaningfully close personal relationship” is not required for insider-trading liability where a tipper discloses inside information as a gift or in exchange for some other type of nonpecuniary personal benefit. The requisite personal benefit exists “whenever the information was disclosed ‘with the expectation that [the recipient] would trade … Continue Reading
The Chancellor of Delaware’s Court of Chancery yesterday urged the Delaware Supreme Court to revise Delaware law on preclusion in shareholder derivative actions. The court’s July 25, 2017 decision in In re Wal-Mart Stores, Inc. Delaware Derivative Litigation recommended that the Supreme Court adopt a rule that a judgment in one derivative action cannot bind the … Continue Reading
The Second Circuit held today that putative securities class actions involving transactions in non-U.S.-listed securities require careful scrutiny to determine whether the class members’ claims can be litigated on a classwide basis. The court’s ruling in In re Petrobras Securities (No. 16-1914) will likely increase the difficulty of certifying securities class actions arising from transactions in … Continue Reading
On June 26, the U.S. Supreme Court ruled that the pendency of a securities class action does not allow individual class members to opt out of the class and file separate actions under the Securities Act of 1933 more than three years after the relevant securities offering took place. The Court’s decision in California Public Employees’ … Continue Reading
The Amsterdam Court of Appeal denied approval of the €1.204 billion collective settlement of former Fortis (now Ageas) shareholders’ claims unless the parties agree to restructure the allocation of the settlement amount among class members and the compensation for the organizations that filed the proceeding. The court’s June 16, 2017 decision does not undermine the use of … Continue Reading
A federal court in Utah recently held that the Securities and Exchange Commission may bring an enforcement action based on allegedly foreign securities transactions involving non-U.S. residents if sufficient conduct occurred in the United States.… Continue Reading
A Pennsylvania federal court held yesterday that an agreement not to use confidential inside information for trading purposes need not precede the receipt of that information in order to create liability under the misappropriation theory of insider trading. The ruling in SEC v. Cooperman (E.D. Pa.) appears to be the first decision to address the “novel … Continue Reading
In what appears to be the first appellate decision since the Supreme Court’s December 2016 ruling in Salman v. United States, the U.S. Court of Appeals for the First Circuit affirmed an insider-trading conviction based on a tip of material, nonpublic information. The February 24, 2017 decision in United States v. Bray held that the jury had … Continue Reading
The Delaware Supreme Court requested further consideration of the federal due-process issues that might arise where a court is asked to hold that a shareholder derivative action is precluded because a prior derivative action was dismissed based on the first plaintiff’s failure to make a demand on the company’s board before filing suit. The Court’s … Continue Reading
The U.S. District Court for the Northern District of California held on January 4, 2017 that the federal securities laws apply to U.S. transactions in sponsored, but unlisted, American Depositary Receipts (“ADRs”) for a foreign issuer’s shares. The decision in In re Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products Liability Litigation adds to the … Continue Reading
The Supreme Court confirmed today that the “personal benefit” required to establish a claim for insider trading can consist of making a gift of material, nonpublic information to a family member or friend and that an exchange of “something of a pecuniary or similarly valuable nature” is not required. The decision in Salman v. United … Continue Reading
U.S. District Judge Jed Rakoff denied motions for judgment as a matter of law or for a new trial after a jury found the defendants civilly liable for insider trading. The decision in SEC v. Payton (S.D.N.Y. Nov. 29, 2016) held that the jury had sufficient evidence to conclude that the initial tipper of inside information had … Continue Reading
As U.S. law has become less willing to entertain certain types of lawsuits on behalf of worldwide classes of plaintiffs, litigants have looked for other forums that might allow the prosecution – or at least the resolution – of claims on a global, classwide basis, ideally through opt-out classes. The Netherlands has emerged as an … Continue Reading
All eyes were on the U.S. Supreme Court yesterday as it heard arguments in Salman v. United States (No. 15-628) concerning the “personal benefit” required to establish a claim for insider trading. After an hour punctuated by the Justices’ constant questioning of attorneys for both the defendant and the government, it appears unlikely that the Supreme Court … Continue Reading
The U.S. Court of Appeals for the Second Circuit issued a lengthy opinion today in the long-running In re Vivendi, S.A. Securities Litigation, affirming the jury’s verdict on liability and addressing issues about loss causation and expert-witness testimony. But the tail on the proverbial dog also dealt with another set of issues that this blog … Continue Reading
The U.S. Court of Appeals for the Ninth Circuit held today that the Sarbanes-Oxley Act’s disgorgement provision – which requires disgorgement of certain CEO and CFO compensation when an issuer restates its financial statements “as a result of misconduct” – applies even if the CEO and CFO were not personally involved in the misconduct. Although … Continue Reading
Insider Trading for Dummies: Judge Rakoff Tries to Simplify the Law
By Jonathan Richman on Posted in Corporate Governance, SEC Enforcement, White Collar
Dutch Court Approves Collective Settlement of Fortis Shareholders’ Claims
By Jonathan Richman on Posted in International, Securities Law
Second Circuit Again Upholds Tipper/Tippee Liability from Gift of Information Without Close Relationship
Supreme Court Rules That Federal Courts Are Not Bound to Give Conclusive Effect to Foreign Governments’ Statements About Their Laws
By Jonathan Richman on Posted in Second Circuit, Securities Law, Securities Litigation
Supreme Court Prohibits Stacking of Successive Class Actions Beyond Limitations Period
By Jonathan Richman on Posted in Class Settlement, SEC Enforcement, Securities Law
Supreme Court Rules that State Courts can Adjudicate Class Actions Under the Securities Act of 1933
By Jonathan Richman on Posted in Class Settlement, SEC Enforcement, Securities Law
Fourth Circuit Upholds Disclosure of Government Subpoena as Evidence of Loss Causation
By Jonathan Richman on Posted in Securities Law, Securities Litigation
Delaware Supreme Court Confirms Preclusive Effect of Dismissal of Derivative Actions Based on Lack of Demand Futility
By Jonathan Richman on Posted in SEC Enforcement, Securities Litigation
Second Circuit Holds That Tipper/Tippee Liability Can Arise from a Gift of Inside Information Even Without a Close Personal Relationship
Delaware Chancellor Urges Revision of Preclusion Principles in Derivative Actions
By Jonathan Richman on Posted in Corporate Governance, SEC Enforcement, Securities Litigation
Second Circuit Requires Increased Scrutiny of Securities Class Actions Involving Off-Exchange Transactions
Supreme Court Holds That Securities-Law Statutes of Repose Are Not Subject to Class-Action Tolling
Dutch Court Denies Approval of Collective Settlement Unless Changes Are Made as to Allocation of Compensation and Fees
By Jonathan Richman on Posted in International, Securities Litigation
We Know What You Really Meant: Utah Court Holds that SEC Can Bring Extraterritorial Enforcement Action Based on Conduct or Effects in United States
By Jonathan Richman on Posted in SEC Enforcement, Securities Litigation
Non-Use Agreement Need Not Precede Disclosure of Confidential Information
By Jonathan Richman on Posted in Corporate Governance, SEC Enforcement, Securities Litigation
Watch the Napkin: First Circuit Affirms Insider-Trading Conviction
Race to Courthouse in Shareholder Derivative Actions Could Raise Due-Process Issues
By Jonathan Richman on Posted in SEC Enforcement, Securities Litigation
California Federal Court Holds that U.S. Securities Laws Apply to Sponsored, Unlisted ADRs
By Jonathan Richman on Posted in Class Settlement, Securities Law, Securities Litigation
Supreme Court Reaffirms Personal-Benefit Requirement for Insider Trading
By Jonathan Richman on Posted in Corporate Governance, Securities Litigation, White Collar
New York Court Upholds Insider-Trading Verdict
Dutch Collective Actions vs. Collective Settlements
By Jonathan Richman on Posted in International, Securities Law
Supreme Court Hears Argument on Meaning of “Personal Benefit” in Insider Trading
By Jonathan Richman and Alexandra Skellet on Posted in Securities Law, Securities Litigation, White Collar
Second Circuit Affirms Exclusion of Certain Foreign Purchasers and Purchases from Securities Class Action
By Jonathan Richman on Posted in Second Circuit, Securities Law, Securities Litigation
Ninth Circuit Holds That SOX Disgorgement of Incentive Compensation Does Not Depend on Executives’ Own Misconduct
By Jonathan Richman on Posted in SEC Enforcement, Securities Law, Securities Litigation
