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Morgan & Morgan's Securities Litigation Team

Both institutional investors and individual shareholders turn to Morgan & Morgan's securities litigation team for representation in high-stakes investment fraud cases.

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Protecting the Rights of Investors

Executives at publicly traded companies have a duty to tell the truth to the investing public.

When this duty is breached and shareholders lose money, investors may be able to take legal action through a securities class action lawsuit. By filing a lawsuit, investors can recover compensation for any losses resulting from the company's actions. Taking legal action can also help enact meaningful corporate governance reforms to prevent the misconduct from occurring in the future. Morgan & Morgan's securities litigation attorneys have developed a track record of success protecting the rights of investors nationwide and helping ensure corporate insiders are honest and straightforward with their investors.

Because securities law is a highly technical and specialized area of the law, it is important to work with lawyers who have experience handling complicated securities law cases.

The attorneys at Morgan & Morgan not only have decades of experience representing investors in securities lawsuits, but also a deep understanding of how capital markets work. We are currently offering consultations to both individual shareholders and institutional investors.

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Securities Fraud Lawsuits

Securities fraud occurs when corporate insiders make misleading statements to investors or fail to disclose material information that would affect an investor's decision to buy or sell securities. Congress has enacted a number of laws to protect investors from fraud, most notably the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002, and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

When a company violates these laws, our attorneys can file a lawsuit to help investors recover compensation for any resulting financial losses. We generally file these cases as class actions, where one investor or a small group of investors files a lawsuit on behalf of themselves and all other shareholders who have been harmed by the securities law violations.

10b-5 Class Actions

The Securities and Exchange Commission adopted Rule 10b-5 to close a gap in the antifraud provisions of federal securities law. Prior to its enactment, federal law prohibited fraud in connection with the sale of securities; however, fraud in connection with the purchase of securities was not prohibited.

Our securities litigation attorneys generally use Rule 10b-5 to:

  1. Prevent insider trading: Insider trading occurs when an officer, director or other corporate insider buys or sells the company's securities when he or she is in the possession of material, non-public information.
  2. Prevent companies from issuing misleading information to the public: Rule 10b-5 also prohibits corporate executives from remaining silent and failing to disclose material information to investors.
  3. Prohibit insiders from selectively disclosing material, non-public information to another party: Rule 10b-5 prohibits corporate insiders from "tipping off" a single investor or small group of investors regarding material information.
  4. Prevent directors and officers from mismanaging a corporation in ways that are connected with the purchase or sale of securities.
  5. Prohibit securities firms from manipulating the market for a security traded in the over-the-counter market.

Shareholder Derivative Actions

Our attorneys also help investors file shareholder derivative lawsuits when the directors or officers of a company are not acting in the best interests of their shareholders. In most shareholder derivative actions, the plaintiff does not seek monetary compensation, but rather to impose meaningful corporate governance reforms and management changes to protect shareholders' long-term financial interest in the company.

Our attorneys mostly file shareholder derivative lawsuits that allege a company's directors and officers have breached the duty of loyalty or duty of care owed to the company's shareholders. Under the duty of loyalty, a corporate executive may not place his or her own financial interests ahead of the financial interests of the company's shareholders. Under the duty of care, a corporate executive must exercise good business judgment and act prudently in managing the corporation. If either of these duties is breached and corporate assets are squandered, our attorneys can help a shareholder file a derivative lawsuit to protect the financial health of the company.

Unlike securities class actions filed under Rule 10b-5, shareholder derivative lawsuits are usually filed in state court rather than federal court.

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Whether you are an individual shareholder or institutional investor, you have a right to complete and accurate information. If you have been misled, we can help.

- Morgan & Morgan Securities Litigation Group

Services for
Institutional Investors

Institutional investors, such as trustees of pension funds and university endowments, have a fiduciary duty to ensure that the assets they manage are not at risk because of securities law violations. To help institutional investors fulfill their fiduciary duties and ensure that their investment performance will not suffer because of negligence or fraud, Morgan & Morgan's securities litigation attorneys also provide the following services to their institutional clients:

Portfolio Monitoring

Our securities litigation attorneys are often called upon by pension fund trustees and other institutional investors to monitor investment portfolios for losses that have occurred because of securities fraud. We alert clients when their investments have lost value because of fraud and initiate litigation to recover losses. Our attorneys provide portfolio-monitoring clients with timely information regarding potential losses due to securities law violations.

Opt-Out Litigation

Our attorneys work with investors to determine if shareholders should opt-out of securities class action lawsuits and instead file their own claims. In some cases, an investor's interests may be better served by filing a separate suit or joining other similarly situated investors who decide to opt out of the class action.

Corporate Merger Reviews

In the midst of the excitement surrounding a corporate merger, the board of directors of the target company may not be working to ensure that shareholders receive the highest possible price for their shares. Our attorneys can review the terms of a proposed merger or buyout to determine if the company's directors and officers are satisfying their obligations to maximize shareholder value.

Representation
of Foreign Investors

Foreign investors may face complex choice of law issues in cases involving securities fraud. In some instances, an investor's rights depend on the stock exchange in which the securities were purchased or the investor's country of residence. Our attorneys have experience representing foreign investors in a wide range of securities law matters.

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