Navigating financial markets has always been precarious, but for those with a good command of those markets, the rewards can be great. While every investment involves risks, professional investors know that everyone in the capital markets, including issuers and acquirors, must also play by the rules of the game.
The ever-changing legal landscape for securities investors poses new challenges for professional investors. When the risk of investing transitions from economic to legal, individuals and companies can benefit immensely from the fast and deliberate action of experienced lawyers who have a sound knowledge of historic and current legal developments.
Here at Lowenstein, we provide value-enhancing legal strategies for investors that assist them in maximizing the value of their investments – past, current, and future – and in protecting themselves from legal risks connected to the complex and dynamic securities industry. At Lowenstein, we have a diverse team of seasoned lawyers who successfully handle securities litigation and related litigation across the country on behalf of plaintiffs and defendants. Our team regularly handles claims asserted under Sections 10(b), 14(a) and 18 of the Securities Exchange Act of 1934 (the ’34 Act’) and Sections 11 and 12 of the Securities Act of 1933 (the ’33 Act’).
Lowenstein is a leader in the appraisal rights arena, with a team of experienced attorneys who have prosecuted and defended numerous appraisal actions, including through trial and appeal.
If you would like to request a review of your portfolio regarding appraisal litigation, or potential securities fraud claims, please contact the authors of this blog.
Types of Clients Include:
- Institutional and private investment funds
- Hedge funds
- High net worth individual investors
- Officers, directors, and employees
- Public companies
- Mortgage bankers/lenders
Representative Matters & Areas
Appraisal Rights Litigation
- Represented a hedge fund investor in Aeroflex Holding Corp. who pursued its statutory right to appraisal in Delaware following the company’s acquisition by British defense contractor Cobham plc for $1.5 billion. Cobham acquired Aeroflex for the price of $10.50 per share, which the petitioner contended significantly undervalued the company. The case was favorably resolved by a confidential settlement prior to trial.
- Represented the largest outside investor group in CKx, Inc. (n/k/a CORE Media Group) who pursued their statutory right to appraisal of their more than $50 million stake in the Company following the acquisition of CKx by an affiliate of Apollo Global Management in 2011. CKx was the owner and manager of such iconic brands as American Idol, Elvis Presley Enterprise, and Muhammad Ali.
- Represented Special Situations Funds in Delaware appraisal action involving Leucadia’s acquisition of MK Resources.
- Represented the Magnetar Funds in their appraisal claims against Dell, Inc., an appraisal case involving nearly half a billion dollars’ worth of Dell shares brought by shareholders challenging the value of the merger price paid by Michael Dell and Silver Lake in their take-private acquisition of Dell in October 2013. The case was tried in the Delaware Chancery Court in October 2015 and a decision has not yet been rendered.
- Currently representing a hedge fund investor in Digital River, Inc. who is pursuing statutory appraisal rights in Delaware arising out of Digital River’s merger acquisition by an investor group led by Siris Capital Group, LLC.
Direct Claim Securities Fraud Litigation
- Represented W.R. Huff Asset Management Co., L.L.C., in a federal securities fraud action to recover hundreds of millions of dollars in losses arising out of the purchase of debt securities of Adelphia Communications Corporation. The action asserted claims against Adelphia’s founders and former directors and officers, former auditors, certain underwriters, and other professionals involved in the issuance of Adelphia’s debt securities, under Sections 11, 12, and 15 of the ’33 Act and Sections 10(b), 18, and 20 of the ’34 Act. The claims against Adelphia’s outside directors, its auditor, and its underwriters were successfully settled on confidential terms.
- Represented largest institutional equity investor in direct claims for alleged securities fraud against MF Global and former New Jersey Governor Jon Corzine.
- Represented Special Situations Funds in a securities fraud involving Suprema Cheese, including successful appeal to Third Circuit Court of Appeals.
- Represented Franklin Mutual Advisers in opt-out actions to recover damages for securities purchases made by various Franklin funds in Beazer Homes and Maxim Integrated.
- Currently representing Discovery Capital Management in a direct action against Petrobras and others arising from Petrobras’ alleged bid-rigging and kick-back scheme.
- Currently representing Jet Capital Investors in the United States District Court for the Southern District of New York against American Realty Capital Properties Inc. and several of its former senior executives in connection with the recently disclosed accounting fraud.
Other Investor Rights Litigation
- Represented a group of senior lenders under a credit agreement in an action against Freescale Semiconductor, Inc. The breach of contract and declaratory judgment action was brought by several funds affiliated with institutional investors which lent approximately $400 million to Freescale. Plaintiffs alleged that Freescale breached the credit agreement when it issued approximately $924 million in incremental term loans. The case was successfully settled on confidential terms.
- Representing Appaloosa in claims arising out of the structured finance underlying the $5 billion sale of Stuyvesant Town in New York City.
- Representing first-lien secured lender group in litigation to enforce terms of Credit Agreement.