Securities and Financial Services Litigation

RKC lawyers have extensive experience representing public and private companies, their directors and executive officers, and regulated entities – including broker-dealers, investment advisers, underwriters, and investment fund entities – in a wide variety of securities-related litigation, arbitrations, and administrative proceedings.

Shareholder and Corporate Actions

Companies and their officers and directors frequently are named as defendants in federal securities class actions, shareholder derivative actions and other circumstances involving the public or private sale of securities. Oftentimes in these matters, counsel must manage the defense of several cases arising out of the same facts as well as coordinate with co-counsel, experts and D&O insurance carriers to guide clients efficiently and effectively through a maze of sometimes conflicting laws and processes, and frequently encompassing claims brought in multiple jurisdictions. Many of these cases are “bet the company” litigation requiring the highest degree of skill and experience to handle successfully. In the case of individual directors and officers, personal assets and reputation are often at stake. RKC lawyers have represented companies, officers, and directors, as well as professionals who serve them such as underwriters, accountants, and attorneys, in securities and financial services litigation from coast to coast. RKC lawyers have experience in representing parties to corporate takeovers, proxy fights, tender offers, and mergers and acquisitions.

Representative matters include:
  • Represented executive officers of a $12.5 billion Savings & Loan in a federal securities class action;
  • Represented an executive officer of a mortgage servicing company in a federal securities class action;
  • Represented outside directors of a NYSE insurance and financial services holding company in shareholder derivative suits;
  • Represented a securities broker dealer in a federal class action concerning the charging of handling fees in connection with securities transactions;
  • Represented underwriters in a federal class action arising from failure of a bank;
  • Represented a national restaurant chain and its directors in a shareholder suit seeking to invalidate a $20 million financing through the sale of preferred stock;
  • Represented an online seller of jewelry in a state securities class action concerning stock sold in an IPO. 

Regulatory Actions

Shareholder suits, periodic filings, audit issues, corporate governance suits, and other adverse public disclosures often spawn investigations and/or enforcement actions by regulators of publicly traded companies, including the Securities and Exchange Commission (“SEC”) and the Financial Industry Regulatory Authority (“FINRA”). Many times these cases proceed in parallel to shareholder suits, bankruptcies, or other related litigation. RKC lawyers have substantial experience defending public companies and their directors and officers in such regulatory investigations and enforcement proceedings.

Representative matters include:
  • Represented an executive officer of a public holding company of a bank in an SEC investigation;
  • Represented executive officers of a public holding company of a PEO company in an SEC investigation and subsequent enforcement action;
  • Represented an internet security company in an SEC investigation and subsequent enforcement action;
  • Represented executive officers of a public food processing company in an SEC investigation and subsequent enforcement actions.

Broker-Dealer Representation and Compliance

RKC lawyers have represented brokers (both introducing brokers and clearing brokers), dealers, and underwriters of securities, as well as their officers and employees, in NASD and FINRA arbitration proceedings as well as in state and federal court suits across the United States in matters involving claims of improper, unauthorized, or unsuitable trading; churning; fraud; violations of state securities laws; negligence; breach of duty; failure of supervision; misapplication of client funds; failure to maintain proper books and records; and other regulatory violations. RKC lawyers also assist broker-dealers in evaluating and strengthening compliance and procedures, in improving customer account forms and employee agreements, in defending against claims of former employees in arbitration and in court, and in matters involving acquisitions and departures of individual or groups of registered representatives, including potential or actual “raiding” claims.

Representative matters include: 
  • Represented broker-dealer and its representatives located in several offices in connection with claims arising from private placement of hedge fund securities.
  • Represented clearing broker in numerous cases alleging that clearing broker aided, abetted, and enabled introducing broker's inappropriate conduct, including "boiler room"-type high pressure sales tactics;
  • Represented broker-dealer in numerous FINRA arbitrations in customer claims alleging fraud, unsuitable or unauthorized trading, failure of supervision and violations of federal and state law;
  • Represented broker-dealer in court actions to compel arbitration;
  • Represented broker-dealer and its incoming registered representatives against raiding claims arising from acquisition of multiple offices of another company.

Corporate Investigations and Litigation

RKC lawyers have been retained by boards of directors, audit committees, litigation committees and others to conduct internal corporate investigations in anticipation of litigation, and/or to represent the company and/or its directors and officers in a variety of corporate issues. These may range from merger and acquisition litigation, audit-related issues, and corporate governance matters to defense of directors and officers in adversary cases brought by bankruptcy trustees or creditors’ committees.

Representative matters include: 

  • Conducted an internal investigation for a public company audit committee in connection with a revenue recognition issue that resulted in the resignation of the company’s auditors;
  • Conducted an internal investigation for a bank regarding possible money laundering in a connection with a customer’s real estate investments;
  • Represented the company and board of directors in defense of a RICO claim arising out of the provision of fraudulent letters of credit as collateral;
  • Represented the board of directors of a medical device company in a bankruptcy trustee adversary proceeding for breach of fiduciary duty;
  • Represented the CFO of a bank holding company in a creditors committee suit for negligence, breach of fiduciary duty and fraudulent transfers.

Representation of Parties in Company Failures, Defaults and Workouts

Often the financial collapse of a company or project requires expertise and collaboration in areas of securities law, bankruptcy law, regulatory and administrative law, and corporate law. RKC lawyers are able to service such collaborative needs, working together as a team, in matters such as corporate bankruptcies and restructurings which spawn securities and derivative claims, bond issue defaults and workouts, investment fund failures, broker-dealer wind-downs and terminations, and intra-corporate disputes among shareholders.

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