Case Update – Petrobras Securities Class Action (U.S. and Brazil)

Years after Plaintiffs brought a federal securities complaint against Petrobras, and more than a year after the case settled for approximately $3 billion, Judge Jed S. Rakoff of the United States District Court for the Southern District of New York ordered the unsealing of the majority of documents attached to parties’ summary judgment papers. Judge Rakoff’s decision comes as an important reminder that sealing orders are not intended to last forever.

  • Cornell University moved to intervene in the U.S. securities class action against Petrobras for an order under 28 U.S.C. Section 1782, which authorizes discovery for use in foreign proceedings. Basically, Cornell wanted document produced in the U.S. suit for its arbitration proceedings in Brazil. The Honorable Judge Rakoff denied the Section 1782 request on the grounds that (a) as a non-U.S. company with overseas operations, Petrobras did not sufficiently “reside” and was not legally “found” in the district, and (b) the term “foreign or international tribunal” did not encompass the CAM arbitration chamber in Brazil as it was the creation of private parties.
  • Judge Rakoff largely granted Cornell’s alternate motion to unseal documents including those used in the summary judgment proceedings, which will make them publicly available for use in Brazil. He ordered the parties to review the documents and agree or present arguments why specific documents should or should not be unsealed.

Meanwhile, in Brazil, the tribunal arbitrating Petrobras claims has taken an expansive view of its jurisdiction, requiring the majority shareholder to submit to arbitration.

  • While complicated, the decision boiled down to this: if an issuer’s bylaws require arbitration when claims are filed, the Market Arbitration Chamber of the B3 S.A. (“CAM”) has jurisdiction over them even if the company did not expressly submit to mandatory arbitration at CAM until later.
  • This ruling is a bellwether for future securities matters and the decision encourages those with claims under investigation or book-building against Brazilian issuers for alleged wrongdoing. Parties contemplating foreign proceedings potentially can use 28 U.S.C. §1782 to obtain broad discovery from U.S. persons for use in their foreign proceedings.

For more information on this case, please contact your FRT representative or email us at

Additional Sources:


Subscribe to FRT’s Monthly Newsletter

Financial Recovery Technologies’ Shareholder Litigation Fast Five provides you with the top news in shareholder class actions. This is your exclusive summary of the latest industry developments related to settled, group and antitrust actions and recovery opportunities. Click here to subscribe.

Learn More

To learn more about how FRT can help your firm maximize recoveries in shareholder class action settlements, contact us at

About FRT


Founded in 2008, Financial Recovery Technologies (FRT) is the leading technology-based services firm that helps the investment community identify eligibility, file claims and collect funds made available in securities and other class action settlements. Offering the most comprehensive range of claim filing and monitoring services available, we provide best-in-class eligibility analysis, disbursement auditing and client reporting, and deliver the highest level of accuracy, accountability and transparency available. For more information, go to

This communication and the content found by following any link herein are being provided to you by Financial Recovery Technologies (FRT) for informational purposes only and does not constitute advice. All material presented herein is believed to be reliable but FRT makes no representation or warranty with respect to this communication or such content and expressly disclaims any implied warranty under law. Opinions expressed in this communication may change without prior notice. Firms should always seek legal and financial advice specific to their unique situation and objectives.