Report Highlights Key Issues and Legal Developments for Companies and their Officers and Directors in 2016
Nashville, Tenn. (March 10, 2016) – Bass, Berry & Sims PLC announces the release of the Securities and Shareholder Litigation: 2015 Year-End Review, the firm's annual report on the most important trends and developments in securities and corporate governance matters affecting companies and their officers and directors. The report provides analysis of significant developments in corporate and securities law in 2015, including the establishment of the Tennessee Business Court, the new rulings applying the U.S. Supreme Court's Omnicare decision, merger and acquisition lawsuits and liability, and major cases out of the Sixth Circuit. Written with an eye to lawyers and non-lawyers alike, the report also offers practical guidance for officers, directors and general counsel as they navigate these issues going forward. Download the full 2015 Securities and Shareholder Litigation Report here.
"Business leaders will face an actively evolving legal landscape in 2016 on the heels of major developments in 2014 and 2015 that impacted the law in several areas," said Britt Latham, co-chair of Bass, Berry & Sims' Securities & Shareholder Litigation Practice Group. "This year's report provides further guidance on many of the areas we discussed in last year's report, such as attorney-client privilege, while also highlighting new developments such as the establishment of the Tennessee Business Court. We hope that this year's report continues to be a go-to reference that concisely summarizes the events, trends and case law affecting public companies and their directors."
Among the six key trends and topics covered in the report are:
Tennessee Establishes Specialized Business Court in 2015 – The year was notable for the establishment of the Tennessee Business Court Pilot Project, which was a study to determine whether a statewide Business Court would benefit Tennesseans with faster and more efficient resolutions, how that court should operate and how to define its appropriate jurisdiction. This section discusses the importance of having a specialized Business Court, the kinds of cases that are eligible for transfer to the Business Court, the operations of the Business Court and the success of similar specialized courts in other states.
Courts Grapple with Whether Omnicare Applies to Claims Brought Outside the 1933 Act – Since the U.S. Supreme Court ruled in Omnicare v. Laborers Dist. Council Const. Indus. Pension Fund in March 2015, lower courts have grappled with the scope of the Supreme Court's opinion on when a statement of opinion in a registration statement can give rise to liability under the Federal securities laws. This section examines how different lower courts have interpreted the scope of Omnicare, and the implications of the varying interpretations.
Disclosure-Only Settlements: Extinction or Migration? – Among one of the most important developments in corporate law this year is the supposed death of disclosure-only settlements in Delaware – the favored forum for merger objection lawsuits. These settlements are often used to quickly resolve stockholder lawsuits involving the acquisition of a public corporation, but Delaware jurists have long expressed concern that these lawsuits often settle quickly for nothing more than supplemental disclosures that provide little value to shareholders. In response to this perceived problem, Delaware's Court of Chancery began rejecting disclosure-only settlements in an effort to protect the rights of absent class members who were being asked to release all possible claims – known and unknown – without being educated on the value or merits of those potential claims. In 2016, practitioners will be left wondering whether the routine litigation that follows public company mergers will survive by drifting into other states.
Financial Advisor Liability – In the world of modern mergers, acquisitions and other corporate transactions, it is common, if not essential to rely on the advice of outside financial advisors. Historically, financial advisors have remained immune from liability so long as they were not negligent and the company's board and its directors did not breach any fiduciary duties when working with the advisor. However, an October 2015 ruling by the Delaware Court of Chancery began to change that dynamic. Financial advisors now face new risks and responsibilities when giving advice to corporate boards in the context of transactions, regardless of any actionable wrongdoing by the directors.
Update on Significant Securities Cases Decided by the Sixth Circuit in 2015 – The report provides a brief overview of some of the most significant securities cases decided by the Sixth Circuit in 2015, including, Pension Fund Group v. Tempur-Pedic Int'l, Inc., Bondali v. Yum! Brands, Inc., and Verble v. Morgan Stanley Smith Barney, LLC.
Navigating the Attorney-Client Privilege at Home and Abroad – While last year's report explored legal trends and developments related to the treatment of the attorney-client privilege and change of privilege control in the context of mergers and acquisitions, this year's Securities and Shareholder Litigation Review focuses on the thorny privilege-related issues facing in-house counsel of companies with global operations or affiliates. This section discusses attorney-client privilege and work product protection under both U.S. law and international law, and provides practical takeaways and considerations for counsel representing companies that operate in multiple jurisdictions.
About Bass, Berry & Sims Securities & Shareholder Litigation Practice
In recent years, the Bass, Berry & Sims Securities & Shareholder Litigation team has represented dozens of publicly traded companies in securities, corporate governance and merger-related internal investigations and lawsuits, including class actions involving subprime securities and leveraged buyout and merger transactions valued in excess of $75 billion.
About Bass, Berry & Sims PLC
With more than 260 attorneys representing numerous publicly traded companies and Fortune 500 businesses, Bass, Berry & Sims PLC has been involved in some of the largest and most significant business transactions and litigation matters in the country. For more information, visit www.bassberry.com.