Mayer Brown's Securities Litigation & Enforcement practice offers a complete package of enforcement and litigation services that can address any development in the course of a securities-related dispute. Mayer Brown’s Securities Litigation & Enforcement practice was recognized as a top tier firm in US News’ “Best Law Firms” report and was also ranked as a “standout firm” for securities litigation by The BTI Consulting Group’s Litigation Outlook report. In 2021, the practice was recognized by the Legal 500 for securities litigation.
Our Securities Litigation & Enforcement practice includes a deep bench of former federal prosecutors and other government officials; a collection of seasoned trial lawyers, each with dozens of trials and arbitrations under their belts; and a corps of appellate lawyers who are routinely ranked at the highest levels. What makes this extraordinary collection of talent and experience particularly effective, however, and distinguishes Mayer Brown’s Securities Litigation & Enforcement practice from those of other leading firms is the close integration of these professionals in addressing every aspect of potential and actual disputes involving the applications of securities laws and regulations. The integration of Mayer Brown’s compliance, investigation, enforcement, litigation and appellate capabilities means that Mayer Brown’s representation of its clients in multi-faceted securities matters is seamless. As a result, we provide our clients with a complete package of enforcement and litigation services that can effectively and efficiently address any development in the course of a securities-related dispute.
While we often take charge of a matter at the first sign of regulatory interest, clients also retain us near the culmination of an investigation to assess their litigation options, to vigorously defend against enforcement proceedings in court or before regulatory tribunals or to negotiate favorable resolutions. Given our extensive experience with securities law enforcement, we are able to defend all aspects of any criminal or enforcement action, from the onset of an inspection, examination or investigation through the grand jury stage, to the administrative proceeding, trial and appeals.
We defend and represent companies and individuals in the broad array of investigations conducted by virtually any financial products regulator in the United States, including the SEC, Financial Industry Regulatory Authority (FINRA, formerly NYSE and NASD), Commodity Futures Trading Commission (CFTC), Public Company Accounting Oversight Board (PCAOB), individual states, and self-regulatory organizations (SROs). In addition, we regularly handle investigations and related proceedings conducted by the Financial Conduct Authority (FCA) in the UK, the Hong Kong Securities and Futures Commission, the Hong Kong Monetary Authority, the China Securities Regulatory Commission in Asia, and other regulators worldwide.
The best defense to an enforcement action is to prevent one from ever occurring, and we regularly counsel clients to be proactive and aggressive in developing, implementing, and administering internal compliance programs. When compliance problems arise, we help our clients by conducting internal investigations and developing strategies to mitigate the regulatory exposure and resulting risks to their public reputation. And our knowledge of, and experience in conducting, internal investigations is crucial in helping us advise clients regarding potential litigation and regulatory action, civil discovery, privilege issues, and government cooperation.
Regulatory Enforcement Compliance
Mayer Brown's enforcement team often conducts independent internal investigations on behalf of corporate management, boards of directors, government agencies and other investigators, and reviews internal policies and procedures for compliance with regulatory standards. That includes issues relating to alleged insider trading or options backdating. We also assist clients with securities-related investigations by the SEC, DOJ, state and federal grand juries, state attorneys general, and regulatory authorities worldwide. Audit committees and individual corporate directors seek our advice on fiduciary responsibilities, corporate governance, Sarbanes-Oxley compliance, and financial reporting obligations.
Regulatory Enforcement Defense
Due in large part to our emphasis on compliance and our ability to conduct reliable internal investigations, our lawyers are frequently successful in convincing regulators not to institute enforcement actions against our corporate and individual clients. We have also helped clients reach favorable settlements. In doing so, we seek to avoid the risk of litigation, but when a favorable resolution outside of litigation is not possible, we routinely take on the government in civil, criminal and administrative proceedings. Often Mayer Brown is retained after an investigation has begun, in order to assess client options and develop the most effective litigation or settlement strategy. As a result, we have litigated extensively and successfully against the SEC and other government regulators and SROs. In the United Kingdom, our lawyers have experience in representing companies and individual officers in regulatory investigations and proceedings brought by the FCA. This covers a broad range of matters, from technical regulatory compliance issues to broad-based allegations of securities fraud.
The integration of our experience and skill as investigators and compliance counselors with our trial and appellate capabilities is particularly beneficial to clients in securities litigation, where heightened pleading standards, accelerated consideration of class certification issues and other judicial decisions have made it easier to seek dismissal of securities cases and to develop and assert defenses earlier in the litigation process. Our detailed understanding of the unique defenses available in class, derivative and securities cases, coupled with our mastery of fact development and our proven record as trial lawyers, frequently makes the difference in achieving ultimate, or even early, victory. Mayer Brown lawyers have been the driving force behind many of the most significant securities decisions and developments before the US Supreme Court. That includes the victory in Stoneridge Investment Partners v. Scientific-Atlanta (called by The Wall Street Journal “the biggest securities-litigation court clash in a generation”). We have argued hundreds more cases in federal and state appellate courts, often involving enormous stakes and issues.
Trial Litigation Experience
Our success in securities fraud litigation extends to many key cases decided in federal and state courts and in arbitration fora. In fact, since the passage of the Private Securities Litigation Reform Act of 1995, Mayer Brown has handled several hundred securities lawsuits. In addition, many of our securities litigators have extensive experience handling ERISA claims involving many of the issues that regularly appear in securities cases, such as claims of financial statement and disclosure fraud, imprudent investments, and breaches of fiduciary duties.
We have broad experience in private securities litigation, having handled many securities fraud, class action, and shareholder derivative suits. We also regularly defend senior executives, employees, and other individuals in class action litigation alleging violations of the securities laws and RICO statutes.
Other Dispute Resolution Experience
Mayer Brown represents clients before the SEC, FINRA and the New York Stock Exchange, as well as in securities-related investigations conducted by state attorneys general, securities regulators and grand juries. Our team advises publicly held companies and their officers and directors when they are confronted with potential litigation involving allegations of financial fraud, insider trading, stock options backdating, and violations of the Foreign Corrupt Practices Act and Sarbanes-Oxley Act. We also resolve controversies that center on aiding and abetting, secondary liability and financial disclosure rules.
In addition to public companies, we represent investment firms and broker-dealers in dispute resolution. Our lawyers have handled hundreds of disputes in arbitration and in court by customers alleging inappropriate investment and trading strategies, fraud, market manipulation, yield burning, insider trading, and late trading. Our litigators also regularly represent broker-dealers in regulatory and disciplinary matters before state and federal regulators as well as the securities exchanges. We have experience in alternative dispute resolution techniques as applied to securities and other complex business disputes and routinely represent brokerage firms and brokers in arbitration proceedings before FINRA. We also are leaders in the use of mediation and other strategies for achieving negotiated resolutions.
In today’s climate of aggressive government investigation and prosecution of alleged business misconduct, Mayer Brown is renowned for our ability to counsel and defend corporate clients – as well as their officers, directors and employees – in complex criminal, civil and administrative investigations and enforcement proceedings anywhere in the world. Using our intimate understanding of the techniques employed by government investigators and the key facts they are trying to uncover, our experienced team has the global resources to provide informed and insightful answers and effective defenses that are designed to avoid or minimize legal exposure.
Regulation Best Interest – SEC Observations from Broker-Dealer Examinations
SEC risk alert highlights areas of deficiencies and examples of weak practices
- HSBC Securities and HSBC Holdings plc. Representing our client with Residential Mortgage-Backed Securities (RMBS) litigation and advice. This includes securities holder lawsuits across the country, including the filing by the Federal Housing Finance Agency in respect of securities with an initial unpaid principal balance in excess of $6 billion.
- Ally Financial, Inc. We represent Ally Financial Inc. as a principal advisor on contentious issues arising from vintage residential mortgage-backed securities, representing the company in securities lawsuits nationwide, including the substantial recent filing by Freddie Mac’s government conservator, and in a host of governmental investigations.
- AIG. Represent several senior officers and directors of AIG in the massive securities and derivative actions brought against AIG and several other defendants. Plaintiffs have alleged approximately $30-50 billion in damages over a six-year class period in these private shareholder and derivative actions that mirror the allegations brought by the SEC and New York Attorney General against AIG. We also represent a subset of officers and directors in the series of subprime derivative and securities class actions filed against AIG et al. in connection with alleged misrepresentations regarding AIG’s credit default swap (CDS) portfolio.
- Major US financial institution. Represented a major US financial institution in one of the most financially significant disputes surrounding the bursting of the housing bubble. Our client serves as the trustee of “mortgage securitization trusts” holding pools of residential mortgages; institutional investors bought certificates or notes in the trusts, entitling them to the loans’ financial returns. Our client administers over 500 such trusts backed by mortgages from Countrywide Financial Corp., which together include hundreds of thousands of loans. In the summer of 2010, a group of many of the largest investors in the world asserted that Countrywide had breached warranties in its trust agreements (regarding, among other things, its adherence to underwriting guidelines).
- The Northern Trust Company and Northern Trust Investments, N.A. Represented client in three cases brought against them by certain pension and savings plan oversight and investment committees of BP Corporation North America, Inc.; by FedEx and its pension plan; and by an individual purporting to represent a class of ERISA plans. The litigation involves purported damage and equitable claims for alleged fiduciary duty breaches in connection with plaintiffs’ participation in securities lending through investments in various index funds that engaged in securities lending. In the BP Plans matter, plaintiffs also sought a preliminary injunction mandating that their interests in certain lending index funds be liquidated in cash and securities of their choice, and not include securities invested in certain cash collateral pools. After an evidentiary hearing, we defeated the preliminary injunction in full.
- Bank of America. Represented Bank of America which has been sued together with Citibank by Allied Irish Banks, Ireland’s second largest bank, for allegedly aiding and abetting the “rogue trading” by John Rusnak, the former head foreign exchange trader of Allfirst Bank, a former AIB subsidiary. Rusnak, who is currently serving time in federal prison for the fraud he committed against his employer Allfirst, lost some $700 million through his trading.
- Officer of a Willis subsidiary. We represent an officer of a Willis subsidiary, one of the world’s largest insurance brokers, in two class action litigations brought in the federal district court for the Northern District of Texas by Mexican and Venezuelan investors, respectively, over the collapse of the Allen Stanford banking empire. Plaintiffs have sued Willis and the officer, claiming that they relied upon certain favorable statements made by Willis (and the officer) about Stanford. Plaintiffs are seeking in excess of $1 billion in damages in each case.
- Duoyuan Global Water (DGW). DGW, a water company based in China that did an IPO and secondary offering in the United States pursuant to the recent wave of Chinese public listings in the US. We represent Steve Park, the CFO of DGW, and Thomas Rooney, an outside director of DGW, in a putative federal securities class action brought by plaintiffs alleging fraud against the Company and its officers and directors.
- Leading insurance company. We represented a former officer and director of one of the worlds largest insurance companies based in the US in a putative class action brought under ERISA in the Southern District of New York. The ERISA action, along with companion Securities and Derivative actions, have been brought against the company and several other defendants for approximately $30-50 billion in alleged damages over a six-year class period.
- Ernst & Young LLP. We represented our client in this securities fraud class action arising from the market crisis in which plaintiffs alleged that Regions, various officers and directors, its underwriters and its independent auditors, including our client, made misstatements in a registration statement and prospectus concerning the value and risks.
- Former CFO of E*Trade Financial. We represent the former CFO of E*Trade Financial in his individual capacity as a defendant in federal securities class action; a federal derivative; and a state derivative action. All of these cases arise from the decline in E*Trade’s share price after it wrote down a significant portion of its residential mortgage portfolio at the height of the financial crisis. E*Trade and certain individuals are accused of securities fraud and insider trading on allegations that management knew that its loan portfolio had become toxic long before the company announced the write-downs that resulted in the decline in E*Trade’s share price.
- Former Chief Risk Officer at a Government Sponsored Enterprise. Representing the former chief risk officer who was recently charged by the SEC with aiding and abetting in alleged securities fraud and, separately, is a defendant in class action litigation. The case is perhaps the highest-profile enforcement action the SEC has brought against senior executives for conduct during the financial crisis.
- Former Chief Compliance Officer of a Broker-Dealer. Successfully represented the Chief Compliance Officer during an SEC investigation into allegations of securities fraud against the broker-dealer. In the wake of the Madoff scandal, financial regulatory authorities have become more aggressive and chief compliance officers for broker-dealers have faced increased scrutiny and additional, ever-changing regulations.
- In re Initial Public Offering Sec. Litigation. Represented eight issuer corporations and 45 of their respective officers and directors in one of the largest securities class actions ever. Plaintiffs sued 309 companies, approximately 60 investment banks and more than 1,000 of the issuers’ officers and directors. We have taken a leadership role in the issuers’ defense group as one of the firms on the Issuers’ Counsel Committee, which has coordinated strategy for the 309 issuers and their officers and directors.
- Major US Financial Institution. Represented a major US financial institution in one of the most financially significant disputes surrounding the bursting of the housing bubble. Our client serves as the trustee of “mortgage securitization trusts” holding pools of residential mortgages; institutional investors bought certificates or notes in the trusts, entitling them to the loans’ financial returns.
- Northern Trust. Represent The Northern Trust Corporation and various directors and senior officers in a shareholder securities fraud class action and a related shareholder derivative. The cases allege that Northern violated the securities laws by taking insufficient provisions for credit losses with respect to its commercial real estate loan portfolio and making materially misleading statements concerning the results, status, and prospect of Northern’s securities lending business.
Regulation Best Interest – SEC Observations from Broker-Dealer Examinations
SEC risk alert highlights areas of deficiencies and examples of weak practices