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Posts Tagged ‘Cory Ferraez’

Patent Trolls beware.  The House of Representatives passed the Innovation Act by a vote of 325-91 to limit entities that target small business owners and startups for patent infringement.   The bill would require more disclosure of information upfront for infringement lawsuits and also allow judges more discretion in limiting discovery or awarding legal fees.

Opponents of the law state is will hinder innovation and impose onerous burdens on patent holders enforcing their legal rights.  However, the legal community is well aware of this “trolling” practice and companies that are weary of litigation costs see this as a welcome change.

Bill Aimed at Patent ‘Trolls’ Passes House – Law Blog – WSJ.

Hedge fund SAC Capital Advisors LP has agreed to plead guilty to insider-trading and pay $1.8 billion in penalties.  The embattled fund, run by Steven Cohen, has been one of the most successful funds on Wall Street–producing returns of more than 25% over two decades.  Wall Street Journal reports that Cohen is still negotiating to resolve other civil matters, including a ban from the securities industry.

SAC has also agreed to become a inside only management fund, or managing the $9 billion assets owned by Cohen and SAC’s employees.  SAC previously had a total of around $15 billion, including outside capital, but quickly saw outside investors flee when their subscription agreement allowed the withdrawal of their capital.

It makes sense for most hedge funds to quickly transition to the point of strictly managing inside capital anyways, so perhaps this works out well for Cohen and his employees not accused of insider trading.  But pending trouble remains and only time will tell how SAC will fair with continued scrutiny–hopefully SAC and Cohen have some creative attorneys on the team.  Even better, a knowledgable and skilled attorney from this fine legal institution.

SAC Agrees to Plead Guilty in Insider-Trading Settlement – WSJ.com.

See ya later Gary.  After serving as Commodity Futures Trading Commission (CFTC) chairman since May of 2009, Gensler is leaving after his appointment ends in December.  Some have reported that the White House asked him to stay on a second term, but he declined.

Gensler presided over the implementation of Dodd-Frank, the 2010 bill that gave the CFTC regulatory authority over the derivatives market, partially shared with the Securities Exchange Commission (SEC) on security based “swaps.”  Gensler’s highest point came with the LIBOR interest rate scandal that garnered regulators with large fines from investment banks–0ver 200 million by the CFTC alone.

And the revolving door continues.  What do you think, will Gensler retire? Or move back to the private sector? Back to Goldman Sachs perhaps.

Gensler to Step Down as CFTC Chairman – WSJ.com.

The U.S. Securities and Exchange Commission (SEC) announced short selling enforcement actions against 23 firms today, bringing 14.4 million in monetary fines. These firms apparently bought offered shares from an underwriter, broker dealer, or dealer in public offering after having shorted that same security during a “restricted period”

SEC Rule 105 of the Regulation M prohibits the short sale of an equity security during a restricted period (usually 5 days prior to a public offering).

JGP Global and Manikay Partners agreed to pay the most disgorgement of trading profits out of the 23 firms, 2.5M and 1.6M respectively.

The SEC is attempting to prevent short selling that can reduce offering proceeds by companies by depressing the market price shortly before the company prices it public offering.

 

SEC.gov | SEC Charges 23 Firms With Short Selling Violations in Crackdown on Potential Manipulation in Advance of Stock Offerings.

Founder and CEO Michael Dell is one step closer to his own private company again after 65% of Dell shareholders approved a 25 billion dollar buyout.  Dell stockholders will receive $13.75 in cash for each share and a special cash dividend of 13 cents per share, totaling $13.88.   Michael Dell and investment firm Silver Lake Partners are working together on the deal.

The buyout had been previously held up by activist investor Carl Icahn who wanted shareholders to demand a better deal.  Icahn admitted defeat earlier this week while still criticizing the deal.

Still, the minority shareholders who voted against the deal may file suit if they think the shares should be valued at more than the buyout price.   However, that case would take many years, and it seems like the benefits of gaining a few more dollars per share would be outweighed by the costs and time involved in a successful lawsuit.

Michael Dell faces a daunting task to turn around Dell’s slumping growth.  But these types of public-to-private deals might be a signal for things to come.  The benefits of remaining public versus a private, particularly given a firm’s ability to raise private capital more easily (i.e. see Facebook pre IPO), will continue to be a question for both established and startups alike.

Dell Shareholders Approve Buyout – MoneyBeat – WSJ.

This is one of the most illogical arguments I’ve heard a professor make.  And that’s sometimes hard to do.  Of course we want our students practically trained in order to competently practice in whatever area of the law they choose to specialize in.  The only “fantasy” here remains in the academic world.

The less academic mindset we have in employing our law students, the better in my opinion.  Practical skills ensure our employers don’t have to waste time training and dealing with our practical mistakes.  What do you think about this law professor’s thoughts?

The Practice-Ready Law Graduate is a ‘Fantasy,’ Says Professor – Law Blog – WSJ.

The Mississippi Secretary of State’s Office filed an Amicus Curiae in support of a lawsuit against the U.S. Securities and Exchange Commission.  Several Mississippi investors have sued the SEC for failure to pay restitution in the Morgan Keegan settlement nearly two years ago.

In 2007-2008, Morgan Keegan misrepresented and overstated the value of certain mortgage backed investments during the housing collapse.  As a result, over 39,000 investors nationwide lost over $1-Billion.  Over 2,000 Mississippi investors lost more than $71 Million.

Secretary of State Delbert Hosemann says it’s inexcusable for the federal government to withhold Mississippi investors’ own money from them.  The press release below states the SEC hasn’t even come up with a plan to dispense the funds after nearly two years waiting.  The SEC also ignored a demand from Mississippi Attorney General Jim Hood to dispense the funds in April of this year.

Press Release