Financial Recovery Technologies Fast Five provides you with the top news in shareholder class actions. Stay up-to-date on the latest developments in settled (U.S./Canada) claims filing opportunities, Antitrust settlements, Global Group Litigation matters and more. For more information, contact your Financial Recovery Technologies representative or email us.

1. Australia: Investors Slam Frydenberg’s Watering Down of Company Laws

The largest body of institutional investors in Australia representing $1.5 trillion of super savings has slammed the government’s intention to water down the continuous disclosure regime, saying it will dent market integrity. Treasurer Josh Frydenberg announced changes on Wednesday that will reduce the powers of the corporate regulator to take action against directors for failing to disclose important information about a company and to stop the growing number of class actions faced by companies. The Australian Council of Superannuation Investors, which represents local and offshore investment houses, said there was no consultation with major investors on the repealing of continuous disclosure laws they believe are essential. Click here to read the full article.

2. Israel: The District Court Dismisses a Class Action Filed Against Five Foreign Banks Involved in the LIBOR Manipulation

In a recent decision, the Tel Aviv District Court dismissed a class action filed against five foreign banks. Some of the foreign banks asked to dismiss a motion to certify a personal claim as a class action which was filed by “Hatzlacha”- a group that promotes proper civil enforcement of economic regulation and compliance in Israel. Hatzlacha sought to represent a group of banks, insurance firms, funds, and other financial institutions that had been directly injured by an alleged LIBOR manipulation, a rate-fixing scheme, in which several major banks manipulated the London Interbank Offered Rate (LIBOR), causing financial harm to many financial institutions worldwide. Two private investors that had investments in the allegedly injured financial institutions filed the motion as indirect victims of the LIBOR manipulation. The District Court ruled that the plaintiffs did not prove that they have a cause of action against the foreign banks. Click here to read the full article (subscription may be required).

3. SPAC Flop Is Test Case for Disgruntled Investor Lawsuits

Waitr Inc. never had the resources of rivals Grubhub Inc. and UberEats. Yet in November 2018 the online food ordering and delivery business went public through a merger with blank-check firm Landcadia Holdings Inc. But Waitr turned out to be a disappointment. Its shares plummeted as it lost about 96% of its market value in 2019, down from a high of almost $1 billion. That triggered a class-action lawsuit claiming that Fertitta and Handler misled shareholders about the risks of Waitr’s business plan but pushed ahead with announcing their merger two weeks before Landcadia had to return investor money, as it promised. Now, in what could soon be the first ruling of its kind since last year’s record number of SPACs went public, a federal judge is weighing to what extent sponsors of these ventures can be held liable for failing to deliver. Click here to read the full article (subscription may be required).

4. The Missing Piece: Class Actions in the UK

The UK Supreme Court’s ruling in the landmark test case brought by the Financial Conduct Authority (FCA) in June 2020 means tens of thousands of policyholders will now have their claims for COVID-19 losses paid by insurers. One of the insurers in question is Hiscox, whose blanket coverage denial was challenged, most notably, by a collective of policyholders known as the Hiscox Action Group. The Group, comprising more than 350 businesses advised by Mishcon de Reya and backed by Harbour’s funding, played an important role in the outcome of the FCA’s test case. The Hiscox Action Group’s ability to aggregate and pursue hundreds of similar claims seems like another positive advertisement for the UK legal system. On closer examination, however, the Group’s case highlights a defect in the system, namely the lack of a generic class action framework to support it. Click here to read the full article.

5. Stumbling Through Securities Law Challenges for COVID-19 Vaccine Developers

As the world waits to overcome the COVID-19 pandemic, publicly traded pharmaceutical companies waging in that fight are facing the multifaceted challenge of developing COVID-19 responses, informing the public of their progress, and managing legal challenges related to their efforts. Enter AstraZeneca. On January 26, 2021, an institutional holder of AstraZeneca’s American depositary shares (ADSs) filed a putative securities class action complaint in the United States District Court for the Southern District of New York. In the fight against COVID-19, the public continues to monitor the corporate disclosures closely for signs of hope. Disclosing inaccurate or misleading information can result in litigation. As this case shows, pharmaceutical companies developing COVID-19 vaccines are subject to this same level of scrutiny, if not even more so, given the immense attention currently placed on vaccine development. Click here to read the full article.

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