Securities and Derivative Litigation

Our Securities and Derivative Litigation Practice Group has long been trusted counsel to companies, boards, and individuals in high-stakes securities fraud litigation and related disclosure and corporate governance matters. In the BTI Litigation Outlook 2017 report, corporate counsel ranked Carlton Fields in the top 15 percent of all law firms for securities and finance litigation.

How We Can Help

Securities Fraud: We defend securities fraud class actions on behalf of public companies, as well as directors and officers, and other defendants, for claims under the Securities Act of 1933, the Securities Exchange Act of 1934, and state law. We have defended foreign issuers and smaller domestic companies, both of which are increasingly targeted by the plaintiffs’ bar. We also represent private companies and their officers and directors who find themselves the subject of securities fraud lawsuits and breach of fiduciary duty claims.

Shareholder Derivative Litigation: How a board responds to a demand letter from a shareholder makes a large impact on how any ensuing litigation unfolds against the company. We advise companies and their boards in navigating shareholder demands, starting with, as appropriate, setting up a special committee, and continuing through investigation, responding to the complaining shareholder, and managing litigation. We also represent individual officers and directors in derivative litigation. 

Representing Special Litigation Committees: We act as independent counsel to special litigation committees that have been tasked with the investigation and evaluation of shareholder demands. Our team, which includes several former federal prosecutors, is truly independent, and works to quickly and efficiently investigate the allegations and to advise the Committee on whether proceeding with the suggested claims is in the company’s best interests.

Merger Objection and Post-Merger Litigation: Most public company mergers and acquisitions are accompanied by a merger objection lawsuit, in which a shareholder sues the target, the target’s directors and officers, the acquiring company, and any advisers on the deal, seeking to enjoin the business combination and demanding more disclosures and greater value. We can help defendants distinguish the nuisance suit from the suit that demands significant attention, and then counsel companies, directors, and other defendants through the minefield of merger litigation.

Regulatory Defense and Arbitration: We have defended broker-dealers and their associated persons in all manner of litigation, including securities arbitration proceedings before FINRA and the NYSE. Our SEC enforcement experience includes responding to subpoenas and Wells notices and litigation in SEC administrative fora. In addition to defending such matters, we routinely represent witnesses in SEC and FINRA investigations.

Corporate Governance Litigation: We represent companies, directors, officers, and other individuals in all manner of challenges to corporate governance and allegations of breaches of fiduciary duty. We have particular experience with allegations of accounting malfeasance, self-dealing, failure of oversight, and excessive compensation. We interfere at our clients’ request in change of control disputes and in proxy fights. Our firm attorneys are active with the ABA’s Business Law Section and the National Association of Corporate Secretaries and Governance Professionals.

The Carlton Fields Distinction

Up-Front Client Commitment: Our practice is dedicated to our clients’ success, and we commit to the following at the outset of every engagement:

  • We understand our client’s industry and will commit to understanding the company, its business goals, and its overarching objectives for our engagement as counsel.
  • We will conduct an early case assessment and discuss with our client alternative approaches to managing the risks, challenges, and budget for the engagement.
  • We will create a client team to serve the client’s needs at the inception of the engagement that will be committed to knowing the company and the matter intimately.
  • Even in the largest and most complex case, we provide a single point of contact so that there is a mechanism for immediate contact and response.
  • We have the insight and experience to counsel clients when to vigorously contest certain claims and when it is in the client’s best interest to pursue a negotiated settlement.
  • We will discuss and honor the client’s preferred means of communicating with us before, during, and after the engagement.
  • We will keep our client apprised every step of the way, seeking client involvement to the extent preferred.

Intelligent Matter Management: We endeavor whenever possible to obtain early resolution of these types of cases and investigations, which can be disruptive, costly, and unsettling to a company’s management, board, investors, and business partners. By deploying early case assessment, we can triage a new lawsuit and provide an array of options to fit our client’s risk tolerance and budget. Our in-house document collection and analysis tools, including the use of technology-assisted review (such as predictive coding) help to increase efficiencies, find the important documents sooner, and reduce costs. Our practice is at the cutting-edge of emerging issues concerning the preservation, production, and discovery of electronic information.

Alternative Fee Arrangements: We welcome alternative fee arrangements (AFAs) in complex securities and corporate governance litigation. Our AFAs can include phased billing, capped fees and collars, blended rates, success and contingency fees, and other arrangements suitable for the matter. We have found these arrangements particularly effective for managing portfolios of similar cases. Additionally, our billing rates, including those of our New York and Washington, D.C., attorneys, are significantly lower than those of the traditional Northeast and West Coast securities litigation defense firms.

Insurance Company Relationships: We are approved securities litigation counsel for directors and officers liability insurance policies issued by several major national insurers. We have an established track record of working cooperatively with these insurers in the defense of securities claims. We also represent insurance companies as monitoring counsel and coordinating counsel in all manner of securities, derivative, and corporate governance litigation, from inception through mediation and settlement or court resolution.

The Right Experience: Our practice group includes former federal prosecutors and former SEC staff. Our attorneys have substantial trial experience both in enforcement actions and in class actions, and can try the most complex matters when appropriate for the matter. Our litigators handle matters at the federal and state trial and appellate levels, in SEC administrative fora, and in FINRA and NYSE arbitrations.

The Right Resources: The Securities and Derivative Litigation Practice Group draws on the firm’s extensive resources in corporate, securities, tax, government investigations and white collar defense, and appellate and trial support, and other transactional and litigation disciplines. Through our offices in New York, Los Angeles, Connecticut, Atlanta, Washington D.C., and throughout Florida, and our longstanding relationships with numerous local and regional firms throughout the country, we stand ready to litigate, and have litigated, matters throughout the United States.