Securities Litigation

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Irell & Manella LLP attorneys are nationally recognized for their unique accomplishments in the litigation, defense and resolution of securities law and corporate law claims. Our trial-tested securities litigators have been lauded for their bold, intelligent and efficient approaches to addressing every type of securities case, from those representing single individuals in small-dollar matters to those representing major corporations, officers and directors in front-page, bet-the-company litigation. We have broad experience in achieving truly remarkable results for our clients defending against claims by private litigants, the plaintiffs’ class action bar, regulatory agencies (such as the Securities and Exchange Commission), the United States Attorney’s Office and other prosecuting agencies, and combinations thereof.

Chambers USA: America’s Leading Lawyers for Business consistently ranks Irell’s securities litigation practice among the best in the country and in California, and describes the practice group as “a team of astute litigators who constantly produce high-quality work.” Irell’s securities litigators have received numerous other awards and recognitions, including Top 5 Attorneys in California by California Law Business, Top 100 Attorneys in California by the Los Angeles and San Francisco Daily Journal, Top 50 Lawyers on the Fast Track by The Recorder, 500 Leading Lawyers in America by Lawdragon, Securities Litigation Lawyer of the Year by The Century City Bar Association, and Top 20 Defense Verdicts of 2016 by the Daily Journal. As described by a recent client who Irell’s securities litigators represented in dozens of private civil cases, class actions and regulatory investigations and proceedings, our securities litigation group is “a great team with a great law firm…that was able to separate the facts from fiction and from the start of the case, provided me the confidence that at the end of the day I would be OK.”

While Irell has gained a reputation for handling some of the most complex securities and corporate law matters in the country, we have also demonstrated our commitment to helping clients quickly and efficiently resolve even the most straightforward cases. To that end, our clients have appreciated our flexibility and willingness to work with them in considering alternative fee arrangements, which have often resulted in substantial client cost savings, without sacrificing the top-tier representation for which Irell is known. For the more complex and higher-dollar matters, Irell has enjoyed long-standing relationships and served as panel counsel with major directors and officers insurance liability carriers, which allows us to help our clients maximize coverage and navigate other challenging coverage issues.

We have represented clients in cases spanning virtually every segment of the United States economy, including pharmaceuticals, semiconductors, mortgage banking, telecommunications, high-technology equipment, software, e-commerce, cable television, entertainment, consumer electronics, health care, investment banking, financial services, aerospace, government contracting, insurance, home building, automobiles, hotels, restaurants, apparel, utilities, gaming and manufacturing. Our practice encompasses private litigation, including class action lawsuits, arising from federal and state securities laws; shareholder derivative and corporate governance litigation; mergers and acquisitions litigation; representation of companies and individuals in connection with inquiries, subpoenas, and investigations commenced by regulatory agencies or prosecuting authorities; internal corporate investigations and representation of special litigation committees; and advice and counseling in connection with directors and officers insurance issues.

Our depth of experience in this area of the law allows us to tailor our approach to each case to achieve our clients’ objectives in a cost-effective manner. We recognize that every case is different, and we pride ourselves on applying the careful factual and legal analysis that is required to determine the best course of action given the circumstances of a particular situation. The hallmark of our practice in the area, and a source of pride for the firm, has been our ability to deliver creative solutions to these often complex, high-stakes matters. At the same time, because of the depth of our securities litigation practice, we have databases of cases and briefs that allow us to draw on the experiences of the group and thereby enhance the efficiency of our services. And while our expertise allows us to staff matters with a comparatively lean team, in high-stakes, “bet-the-company” cases – which are common in this field – we have the resources and the know-how to prepare and implement a world-class defense on a nationwide basis.

Representative of the most recent and ongoing matters we have handled in this field are the following:

Countrywide Financial: Representation of Angelo Mozilo. Irell & Manella served as lead counsel for the former Chairman and Chief Executive Officer of Countrywide Financial Corporation in dozens of shareholder and regulatory lawsuits and government investigations, which arose from the 2008 Global Financial Crisis and losses suffered in the mortgage banking industry. Our successful representation of Mr. Mozilo has been the subject of international media attention and positive commentary. Among the matters we handled were more than 90 separate civil lawsuits throughout the United States, several brought as investor class actions under federal and state securities laws, and several more pursued by Attorneys General of various states. In a number of the lawsuits brought by institutional investors in Countrywide securities or mortgage-backed securities, we achieved dismissals at the pleading stage (one of which was affirmed on the merits by the Second Circuit Court of Appeal), and we also were successful on motions to dismiss civil lawsuits brought by state Attorneys General of Florida and Illinois. We also defended Mr. Mozilo against claims brought by the U.S. Securities and Exchange Commission, which we settled on the eve of trial without our client admitting any liability and on terms widely reported to be exceptionally favorable to the defense. In an interview aired on 60 Minutes, a law professor described the settlement as a “slap on the wrist.” Other shareholder cases were settled without any personal contribution from our client, including a nationwide class action settlement totaling $624 million. Most recently, the U.S. Department of Justice determined, after several years of intense investigation and extensive presentations and submissions by Irell lawyers addressing the merits, to close its investigation of possible claims against Mr. Mozilo.

Tesla Motors. Irell & Manella secured a dismissal with prejudice of a shareholder class action against Tesla Motors, Inc. and its founder and CEO. The case was filed following two highly publicized incidents involving Tesla vehicles, and alleged that the company failed to adequately disclose risks of fire from underbody collisions. The plaintiffs claimed the incidents revealed the risk and caused Tesla’s stock price to drop. In September 2014, in response to the motion to dismiss and oral argument by Irell on behalf of its clients, U.S. District Judge Charles Breyer ruled that Tesla executives accurately described the exemplary safety record of its vehicles and dismissed the complaint without leave to amend. Irell obtained a unanimous affirmance of the dismissal by the Ninth Circuit Court of Appeals.

Public Storage. Irell & Manella represented Public Storage, a publicly traded Fortune 500 company, in connection with a securities class action lawsuit which sought to enjoin Public Storage’s acquisition of a number of limited partnerships in which it served as the general partner and, later, for alleged damages resulting from the mergers. The plaintiff limited partners argued that Public Storage had breached its fiduciary duties, the limited partnership agreements and California’s Limited Partnership Act by, among other things, paying too low of a price for the limited partnership units, and failing to have an adequate process in place relating to the transaction. The court denied plaintiffs’ motion for injunctive relief and the transaction closed. Plaintiffs continued to aggressively pursue their damages case to trial. After a two-week trial in 2016, at which Irell represented the company, the Court ruled entirely in favor of Public Storage and denied plaintiffs any recovery. (See “Public Storage Defeats Shareholder Class Action“ in the Los Angeles Business Journal and “Irell Locks Up Win for Public Storage“ on Law.com.) Irell’s trial victory on behalf of Public Storage was recognized as one of the Top 20 Top Defense Verdicts of 2016 by the Daily Journal.

MGM Resorts International. Irell & Manella represents the current and former senior-most officers of MGM Resorts International, the worldwide hotel, resort and gaming company, including the company’s current and former CEO and Chairman of the Board, CFO, former General Counsel, and Senior Executive Vice President. Since 2009, we have defended a series of shareholder class actions and derivative suits in federal and state courts in Nevada. The claims concern the company’s decline in financial performance and liquidity challenges during the global recession and following the construction and opening of the $9 billion CityCenter project in Las Vegas, the largest private construction project ever undertaken. Irell secured a dismissal with prejudice of all claims in the state derivative suits, followed by a victory in the Nevada Supreme Court, which affirmed the dismissal. Irell also won a dismissal with prejudice of all claims in the federal derivative suit. Irell further resolved the claims in the consolidated shareholder class action with a settlement that required no payment and no admission of liability by MGM or its executives. The class action is currently being appealed by a shareholder objector. Irell is handling the pending appeal for its clients in the Ninth Circuit Court of Appeals.

M&A Class Action Cases.  Irell & Manella has successfully defended numerous acquirors, targets and board members in high profile shareholder class actions resulting from proposed mergers and acquisitions. We have recently represented and secured successful results for companies (and/or board members of companies) such as Ticketmaster, True Religion Apparel, Bausch & Lomb, CapitalSource Bank, Mid-State Bank, Power-One, Danaher Corp., CPI, Internet Brands, ABB and Ventas.

Ligand Pharmaceuticals. Irell & Manella represents Ligand Pharmaceuticals, its CEO and CFO in a shareholder class action filed in the Southern District of California. The complaint generally alleges that the company’s restatement of certain prior period financials demonstrates that the company made materially false and misleading statements about certain financial results and internal controls. The case is in the pleading stage, and we are vigorously defending the company and its executives.

Calavo Growers. In this consolidated securities class action, Irell & Manella represented Calavo Growers, Inc., a global leader in the avocado industry and a leading provider of diversified fresh packaged foods, and certain of Calavo’s officers and directors in the defense of securities fraud allegations relating to Calavo’s January 2015 restatement of its audited financial statements. Irell twice won dismissal of the complaint—the first time with leave to amend, and the second time with prejudice.

Petroleum Development Corp. Irell & Manella represented Petroleum Development Corporation in multi-jurisdictional litigation arising from a series of transactions in which the company bought out limited partners in certain oil and gas development limited partnerships. Plaintiffs alleged Section 14 disclosure claims as well as state law claims for breach of fiduciary duty. The litigation involved complex questions concerning the valuation of the partnerships’ assets, including the effect of new oil and gas technologies on the value of those assets, and related disclosure issues. The litigation included a class action lawsuit pending in the United States District Court for the Central District of California and an appraisal action in West Virginia state court. Shortly before trial, PDC reached a settlement with the class. One of the lead plaintiffs elected to “opt out” of the settlement and is pursuing his claims in the U.S. District Court in Colorado. We continue to defend PDC in that case.

OCZ Technology Securities Matters. Irell & Manella represents Ryan Petersen, the former CEO of OCZ Technology Group, Inc., in defense of various securities law and investor lawsuits throughout the country, and in a civil lawsuit brought by the U.S. Securities and Exchange Commission. Our representation of Mr. Petersen has included defense of a federal securities class action and a separate shareholder derivative action brought on behalf of OCZ in the Northern District of California for alleged breaches of fiduciary duty, waste of corporate assets, and unjust enrichment, among other alleged violations. Both actions were resolved successfully for our client with settlements funded entirely by the company’s D&O insurers. We also represented Mr. Petersen in a threatened adversarial action by the U.S. Bankruptcy Trustee in the District of Delaware, a matter that was resolved successfully pre-suit, for less than expected costs of defense and, again, without any contribution by our client. We currently continue to represent Mr. Petersen in defending against the remaining lawsuit filed by the SEC.