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Second Circuit Gives Green Light to Foreign Litigants Seeking Discovery in the U.S.

As cross-border business continues to grow, litigation too is increasingly crossing borders. In a recent decision addressing several issues of first impression, the U.S. Court of Appeals for the Second Circuit opted to aid international litigants, interpreting Section 1782 of Chapter 28 of the United States Code to allow discovery in aid of foreign proceedings … Continue Reading

Mutual Funds and Shareholder Litigation: Funds Should Lean In

Should mutual funds take a more active role in securities litigation? Data appears to suggest that they should. According to Sean J. Griffith[1] and Dorothy S. Lund[2], authors of “Toward a Mission Statement for Mutual Funds in Shareholder Litigation”[3], mutual funds can improve returns for investors by taking on a greater role in enforcing shareholder … Continue Reading

Survey Shows Hedge Funds Are Using More Alternative Data, but Data Cost and Quality Issues Remain

According to survey results published in September, 2019, by Lowenstein Sandler, over 80 percent of hedge funds of all sizes are using alternative data in some capacity, with 75 percent of respondents saying they use it to make better investment predictions. Completed by C-level executives, data scientists, equity analysts, portfolio managers, and legal/compliance officers in … Continue Reading

Syndicated Loans: Have They Been Securities All Along?

In a case pending in federal court in New York, Kirschner v. JPMorgan Chase Bank, N.A., No. 17-cv-06334-PGG (S.D.N.Y.), a bankruptcy trustee may upend what has long been accepted wisdom on Wall Street: securities laws apply to stocks, bonds, equity options, and the like – but not to syndicated loans. Kirschner is brought by the … Continue Reading

Student Loan Debt Called a “Trillion-Dollar Blackhole”

Do student loans bear any similarities to mortgage loans, which lay at the heart of the 2008 economic crisis? The short answer is yes. Student loan asset-backed securities (SLABS), much like residential mortgage-backed securities (RMBS), are loans bundled and packaged into securities available for purchase by investors. Bearing ominous resemblance to the precursors to the … Continue Reading

Flattening Yield Curve Signals Looming Recession, Some Say

Recently, investors and economists have focused increased attention on bond market yield curves, which have proven to be a compelling predictor of an upcoming economic recession. The yield curve is the measure of the difference between short-term and long-term interest rates on government bonds.  In a healthy economy, interest rates on long-term (typically, ten-year) bonds … Continue Reading

Private Cryptocurrency Firm Hit With Class Action Lawsuit Over Initial Offering

Investors in a private cryptocurrency firm brought a class action securities lawsuit against the firm itself, Latium Network, Inc. (Latium) and individually against Latium’s founder and CEO David Johnson and co-founder and chief commercial officer Matthew Carden. The lawsuit alleges that the defendants are subject to strict liability for violating Section 5 of the Securities … Continue Reading

CLO Litigation Update

In December 2014, the credit risk retention rule, 79 Fed. Reg. 77,601 (the credit risk retention rule), was adopted pursuant to Section 941 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank). The credit risk retention rule requires any “securitizer” of asset-backed securities (or other related parties) to acquire and retain either (i) … Continue Reading

Third-Party Litigation Funding Fuels Foreign Securities Class Actions

Foreign securities class actions have been on the rise since the U.S. Supreme Court’s 2010 decision in Morrison v. National Australia Bank, Ltd., which held that federal securities laws apply only to securities purchased on domestic exchanges. 561 U.S. 247 (2010). Investors are increasingly turning to foreign forums to recoup losses associated with securities purchased … Continue Reading
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