Case Summaries
Securities Law
[08/26] Bank of Am., N.A. v. UMB Fin. Servs., Inc.
In an appeal from a series of orders in which the district court declined to compel plaintiff to submit to arbitration and declined to stay litigation pending the outcome of such arbitration, the orders are affirmed where: 1) plaintiff never signed an agreement containing an arbitration clause, and the document plaintiff did sign, the employment agreement, did not incorporate the arbitration clause of the FINRA contracts by reference or otherwise; and 2) the court need not reach the question of waiver since the district court properly determined there was no existing right to arbitration in this case.
[08/20] Lustgraaf v. Behrens
In an action for damages arising out of a Ponzi scheme perpetrated by a registered representative of one defendant and general agent of another, the dismissal of the complaint is affirmed in part where the complaint did not allege the additional facts necessary to demonstrate that defendant actually exercised control over its subsidiary's general operations rather than merely possessing the ability to do so. However, the order is reversed in part where plaintiffs met their burden of alleging falsity under the Private Securities Litigation Reform Act.
[08/20] Schleicher v. Wendt
In a securities-fraud suit against some managers of a large, publicly traded financial-services holding company, district court's conclusion that investors can use the fraud-on-the-market doctrine as a replacement for person-specific proof of reliance and causation in granting the class certification is affirmed as, the district court assured itself that the market for the company's stock was thick enough to transmit defendants' statements to investors by way of the price, and as such, the district court did not commit a legal error, or abuse of discretion, in deciding that the fraud-on-the-market doctrine should not be conscripted to serve some other function.
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