Paul R.
Bessette

Neiman v. Bulmahn, et al.:  The Fifth Circuit affirmed an August 2015 district court dismissal of a putative class action filed by ATP shareholders under the Securities Exchange Act of 1934.  The shareholders accused ATP’s former officers of committing securities fraud by misrepresenting various aspects of the company’s business prior to bankruptcy, including its production from a particular oil-and-gas well, its liquidity, and the resignation of its CEO.  The Fifth Circuit held that the shareholders failed to satisfy the heightened standard for pleading scienter. 

In re SemCrude L.P.: Obtained a permanent injunction preventing investors in bankrupt oil-and-gas company from bringing derivative claims against former CEO in Oklahoma state court. A successful Third Circuit appeal won reversal of orders that had denied injunctive relief, with the court quoting the former CEO's brief in a published opinion on the distinction between derivative and direct claims.     

Miyahira v. Vitacost.com, Inc.: Obtained a full dismissal of plaintiff’s claims under the Securities Act of 1933 for misleading statements in Vitacost’s IPO prospectus. The Eleventh Circuit affirmed the dismissal, holding that the complaint did not state a claim for relief despite reliance on ten confidential witnesses and over 100 pages of allegations. This decision is significant given the nearly strict-liability nature of plaintiff’s Securities Act claims.

Bell v. Ascendant Solutions, Inc.: Defeated class certification in a securities fraud class action involving alleged fraud in connection with an IPO. In a widely followed opinion, the Fifth Circuit upheld the denial of class certification based on argument that the company’s stock did not trade in an efficient market during the class period.

In re Crossroads Systems, Inc. Securities Litigation: Obtained summary judgment in a securities fraud class action where the plaintiffs alleged that the company improperly accounted for inventory reserves and sought more than $800 million in damages. The Fifth Circuit affirmed in Greenberg v. Crossroads Sys., Inc., 364 F.3d 657 (5th Cir. 2004). This opinion is one of the key Fifth Circuit cases on what plaintiffs must show to demonstrate entitlement to the fraud-on-the-market presumption of reliance, a key element of a §10(b) securities-fraud claim.

In re Chaparral Resources, Inc. Shareholder Litigation: Represented Lukoil Overseas Holding Ltd. in a shareholder class action in Delaware Chancery Court challenging the fairness of the company’s acquisition of Chaparral Resources, Inc., a Delaware corporation. Tried the case and obtained a settlement below plaintiffs’ lowest pre-trial settlement demand.

In re FirstEnergy Corp. Securities Litigation: Represented this Fortune 100 company in multiple securities fraud class actions where plaintiffs claimed damages in the billions. Plaintiffs alleged, among other things, that defendants nearly caused a nuclear disaster and failed to disclose this fact. Reached a favorable settlement well within D&O policy limits