Multinational Financial Institution – Summary Judgment Dismissal in Securities Fraud Class Action

Successful defense of global bank in connection with a class action brought in the U.S. District Court for the Southern District of New York alleging violations under the 1934 Act and Rule 10b-5. Plaintiffs alleged that the bank knowingly engaged in a scheme with an Italian dairy conglomerate involving the securitization of worthless receivables in order to disguise that the transactions were really a loan meant to prop up the failing Italian company, which was not disclosed to investors. The Court determined that Plaintiffs’ claims against the bank failed because Plaintiffs could not establish that they relied upon the bank’s allegedly deceptive conduct, except in an indirect chain, the type of which the Supreme Court found too remote for liability. (Prior firm experience)