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Securities, Shareholder, Partnership Litigation

This specialty litigation practice reflects our overall core practice of representing companies from the earliest stages of entity formation; to company financings by venture capital, private equity, initial public offerings and later rounds of public financing; to compliance with public-company reporting requirements; to business mergers and acquisitions.

Our experience includes the full range of shareholder and other stakeholder disputes, and includes cases involving governance and control of corporations, limited liability companies and partnerships, officer, director and manager liability, shareholder duties to other shareholders, and shareholder derivative and class actions involving federal and state securities claims.

We represent companies and witnesses in Securities and Exchange Commission (SEC) proceedings, and we handle securities industry arbitrations before the Financial Industry Regulatory Authority (FINRA) and other self-regulatory organizations.

Representative matters we have handled include the following:

  • Defense of publicly-held live-entertainment company in shareholder action alleging California Corporations Code and securities fraud, breach of fiduciary duty regarding obligations to remove restrictive legends, and failure to provide shareholder dissenters’ rights in a reverse merger.
  • Defense of publicly-held digital rights encryption company in state court shareholder action alleging securities fraud.
  • Defense of general partners in venture capital firm in state court action alleging securities fraud.
  • Defense of over 50 shareholders in action by publicly-held broadband implementation company to cancel stock issued in connection with a reverse merger transaction.
  • Defense of class action and derivative suit against general partner and affiliated companies by limited partners of three publicly traded real estate limited partnerships alleging breaches of contract and breaches of fiduciary duties.
  • Defense of securities class action by limited partners of a real estate limited partnership against the limited partnership and related parties alleging federal securities fraud and RICO violations in the sale of the limited partnership interests.
  • Defense of shareholder and officer of publicly-held corporation in shareholder derivative action alleging violations of the California Corporations Code and breaches of fiduciary duty.
  • Defense of shareholder and director of corporation in action alleging securities fraud in connection with the sale of the corporation’s common stock.
  • Prosecution of action by four minority shareholders and employees against the majority shareholder of a military defense contractor to enforce a shareholders’ agreement regarding ownership and control of the company.
  • Defense of directors of publicly-held bank against shareholder claims alleging breach of fiduciary duty in connection with the adoption of a stock option compensation plan.

SEC Proceedings

  • Representation of an information technology services company in and SEC investigation regarding purported violations of the registration and anti-fraud provision of the federal securities laws.
  • Representation of financial services company in an SEC investigation regarding purported violations of the registration and anti-fraud provisions of the federal securities laws.
  • Representation of private investor in an SEC investigation of alleged insider trading.
  • Representation of witness and potential target in SEC investigation of alleged insider trading.
  • Representation of company in responding to several SEC document subpoenas in connection with SEC investigation of private equity investments in Chinese companies becoming public in the U.S.
  • Representation of corporate officer in SEC witness investigation involving contradictions between drafts and the final versions of publicly filed SEC documents.
  • Representation of company in SEC administrative proceeding to revoke securities registration.

FINRA Arbitration

  • Defense of securities brokers in arbitration by customers alleging securities fraud in connection with the sale of auction rate securities.
  • Prosecution of arbitration on behalf of customer against national securities broker-dealer alleging churning and unauthorized trading in securities accounts.
  • Defense of broker-dealer in arbitration by broker concerning commissions on private sales of stock to investors.
  • Prosecution of arbitration on behalf of investment banker against national securities broker-dealer alleging gender discrimination.

Additional Securities Experience

  • Defense of officer of securities broker-dealer in action alleging fraud in connection with the sale of a securities broker-dealer.
  • Defense of publicly traded companies against claims by shareholders that the directors had engaged in short swing sales of the company’s stock in violation of Section 16(b) of the Securities Exchange Act.
  • Defense of certified investment advisor/broker in action alleging securities fraud violations in connection with sales of multiple securities.
  • Defense of general and limited partners in multiple real estate limited partnerships in action alleging securities fraud in the sale of limited partnership interests attributable to material misstatements in the Private Placement Memoranda used to solicit the investments.
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