Stoneridge vs. Scientific-Atlanta / Motorola
Discovering the facts and allegations of the controversial and “most important securities law case in a generation.”
This case is said to be one of the most (if not the most) important securities law cases that the Supreme Court has considered in more than a decade (deVogue 1). It involves a wide range of issues from basic separation of power issues to core securities litigation policy. With this is mind, the Court decided to take a rather narrow look at the case, asking parties to solely address the question of:
“Whether this Court’s decision in Central Bank, N.A. v. First Interstate Bank, N.A., 511 U.S. 164 (1994), forecloses claims for deceptive conduct under § 10(b) of the Securities Exchange Act of 1934… and Rule 10b-5…, where Respondents engaged in transactions with a public corporation with no legitimate business or economic purpose except to inflate artificially the public corporation’s financial statements, but where Respondents themselves made no public statements concerning those transactions” (Bainbridge).
Here we are looking at Rule 10b-5, which is probably the most popular, if not the most important of the SEC’s many rules. It first became a debatable issue in 1994 when the Supreme Court, usually referred to as SCOTUS by people who are familiar with it, ruled on the case mentioned in the above quote. Before that point, it was decided that “courts must infer how the 1934 Congress would have addressed the issue had the 10b-5 action been included as an express provision in the 1934 Act,” but the court had since acknowledged it to be an “awkward task,” some saying that “We are simply imagining [when we do that]” [Lampf, Pleva, Lipkind, Prupis & Petigrow v. Gilbertson, 501 U.S. 350 (1991)]. Therefore, in the Central Bank vs. First Interstate Bank case, courts were required to “use the express causes of action in the securities acts” to make a final ruling.
The Stoneridge vs. Scientific-Atlanta / Motorola case is often compared to the Central Bank vs. First Interstate Bank case because they are very similar in nature. In the Central Bank case, the court ruled that there was no right for a private party to take action against those who aid and abet violations of Rule 10b-5. Therefore, liability was limited to primary rather than secondary participators. This may be the reason why the U.S. Court of Appeals ruled against Stoneridge’s charges, since Scientific-Atlanta and Motorola were indirectly involved and never took any part in falsifying financial documents, nor did they make any public statements about the issue.
One year ago, on September 8, 2016 the Consumer Financial Protection Bureau(CFPB), the Los Angeles City Attorney and the Office of the Comptroller of the Currency (OCC) fined Wells Fargo Bank $185 million, alleging that more than 2 million bank accounts or credit cards were opened or applied for without customers' knowledge or permission between May 2011 and July 2015. This essay will discuss the Wells Fargo scandal by explaining how the event happened and describing how the organization approached handling a response to the crisis. This will be seen, firstly by describing the how the scandal happened, and what were the causes, secondly by discussing the reaction of the company in front of the situation, how they dealt with the crisis and then
and fair one. Many believe it to be the first anti- trust decision in U.S.
For Tenth National Bank, we have reason to believe that the client intercepted the paper confirmation. After we sent the paper confirmation to the bank, we received an email from Lou Jennings stating that the bank forwarded the confirmation directly to their office instead of sending it to the audit team. In addition, Mr. Jennings provided login credentials and a link to the bank’s website, which did not appear to be reliable. As per the video, “How to Fight Confirmation Fraud”, presented by the founder of confirmation.com, Brian Fox, a fictitious website can be created easily. Our skepticism toward the reliability of the website is based on the unresponsiveness of most of the links on the site; the only link that works is the login button. In addition the website appeared dated and rudimentary. Another factor we found quite strange is that the website only offers paper statement deliveries, which we find highly unusual since paper statements are easier to modify. Furthermore, based on the tracking provided by USPS, the letter is still in the shipping process with no indication that Tenth National Bank has officially received the request for confirmation. This further supports our theory that Lou Jennings intercepted the Tenth National Bank confirmation letter. In our o...
This case is based on Mrs. Jennifer Sharkey, who sued J.P. Morgan & Co. (JCMC), Mr. Kenny, Mr. Green, and Mrs. Lassiter, alleging breach of contract and violations of the SOX anti-retaliation statute. The facts started when Mrs. Sharkey was assigned to a Suspect Client 's account where members of JPMC expressed to her their concern regarding to this account because they suspected that the Suspect Client was involved in illegal activities. After Mrs. Sharkey’s investigation, she claimed that she informed her conclusions to superiors Mr. Kenny, Mr. Green, and Mrs. Lassiter, of the Suspect Client 's potential unlawful activities, such as: money laundering, mail fraud, bank engaged in fraud, and violations of federal securities laws. After
After the time of financial crisis, JP Morgan was not the only national bank in US which got involved in trade of toxic loans related to mortgage. Before JP Morgan, it was Goldman Sachs-another large US Bank that faced the allegation of manipulating the trades in its own self interes, ended up in favor of SEC while GoldMan Sachs were asked to pay $500 Million during late 2011 in a deal called Abascus 2007-AC1 where the bank were alleged to mislead its investors on a deal related to Collateral Debt Obligation(CDO). (Eaglesham, 2011) The ab...
"Schenck v. United States. Baer v. Same.." LII. Cornell University Law school, n.d. Web. 6 Jan. 2014. .
The outsourced administrative support company accused CFPB of the alleged accountability absence that violated the US Constitution. The Congress “interfered” with the consumer finance protection regulation that stirred additional legal charges against the CFPB. However, the specialty of CFPB as the only existing remedy against the financial crisis made it possible for the company to overrule the congressional interference and retain “accountability deficits” (Block-Lieb, 2012, p. 28). The present position shows the dubiousness of the CFPB that goes against the governmental regulations while secures the ability of the population to loan and be
To understand why the standard applied in Katz6 is the most suitable for answering the questions of this motion, its alternatives must be considered. Beside Katz, Olmstead v. United States7 and Kyllo v. United States8 stand as pivotal cases that dealt with the...
Pitzer, Matt. "The Case Against Goldman Sachs." Last modified 04/21/2010. Accessed October 5, 2011. http://www.business.missouri.edu/ifmprogram/reports/2010WS/GS.doc
Maryland (1819), the state of Maryland had passed an act to set a tax on all banks not chartered by the legislature. The bank that McCulloch worked at had that tax imposed on it but McCulloch refused to pay the tax. So the state of Maryland sued him. “…involved the question of whether Congress had the power to charter a national bank-an explicit grant of power nowhere to be found in Article I, Section 8. Chief Justice John Marshall answered that this power could be “implied” from other powers that were expressly delegated to Congress, such as the “powers to lay and collect taxes; to borrow money; to regulate commerce; and to declare and conduct a war.” Marshall’s decision rested on “the necessary and proper clause” of Article I, Section 8, which gave Congress the power to enact laws “necessary and proper” for executing its substantive powers.”(We The People, p.
The United States v. Thomas J.L. Smiley et al.. (n.d) retrieved 1 February 2012, from Google Books Web Site:
"Summary of United States V. Emerson." FindLaw: Cases and Codes. Thomson Reuters. Web. 29 May 2010. .
Ponzi schemes are a continuing problem in the investment world and can only be stopped if the Securities and Exchange Commission does better safe guarding investors’ money. This paper will address Bernie Madoff’s Ponzi scheme and how he was able to steal billions of dollars from investors. The reasons why the SEC responded so slowly to Bernie Madoff’s Ponzi scheme, and what can be done in the future to make sure another Ponzi scheme of this magnitude does not happen again. Also included in this paper will be examples of good and bad leadership theories.
Summary of the Court Case. (Cover story). (1989). Congressional Digest, 68(8/9), 194-224. Retrieved from http://ezproxy.wnc.edu:2048/login?url=http://search.ebscohost.com/login.aspx?direct=true&db=aph&AN=8910300671&login.asp&site=ehost-live&scope=site
The stock market is an enigma to the average individual, as they cannot fathom or predict what the stock market will do. Due to this lack of knowledge, investors typically rely on a knowledgeable individual who inspires the confidence that they can turn their investments into a profit. This trust allowed Jordan Belfort to convince individuals to buy inferior stocks with the belief that they were going to make a fortune, all while he became wealthy instead. Jordan Belfort, the self-titled “Wolf of Wall Street”, at the helm of Stratton Oakmont was investigated and subsequently indicted with twenty-two counts of securities fraud, stock manipulation, money laundering and obstruction of justice. He went to prison at the age of 36 for defrauding an estimated 100 million dollars from investors through his company (Belfort, 2009). Analyzing his history of offences, how individual and environmental factors influenced his decision-making, and why he desisted from crime following his prison sentence can be explained through rational choice theory.