• Private Label Mortgage-Backed Securities
• Securities Fraud
• Securities Lending
Keller Rohrback is one of America’s leading law firms handling securities-related litigation. This firm is committed to helping investors protect their investment options.
Private Label Mortgage-Backed Securities (“PLMBS”)
Keller Rohrback is uniquely positioned to be an effective advocate for investors on claims involving PLMBS. Based on the firm’s extensive experience in securities fraud and other litigation involving mortgage-backed securities and subprime lending, firm attorneys and legal staff are experienced and ready to identify, review, and vigorously pursue their investors’ strongest claims. Keller Rohrback regularly represents plaintiffs—including both institutions and individuals—in complex and class action cases.
The principal claims arising out of investment in PLMBS and investment instruments related to PLMBS, such as credit default swaps (“CDS”) and collateralized debt obligations (“CDO”), involve misleading statements and omissions made in connection with the sales of the securities in offering documents. These claims are most often based on violation of the applicable state securities blue sky laws, federal securities laws, and common law. Defendants include the issuers of the securities, underwriters, control persons, and other persons directly or indirectly involved in the sales (including, for example, credit rating agencies whose ratings misrepresented the credit quality of the securities). Depending on the location of the parties involved in the sale of securities, additional claims for fraud, negligence, breach of contract, unjust enrichment, unfair competition, or interference with contract or prospective economic advantage may also exist under the laws of multiple states.
The law varies significantly with respect to the conduct on which a claim may be based, the remedies available, persons who may be liable, and statutes of limitation. As a general matter state blue sky laws offer robust remedies (including rescission) and a reasonably generous statute of limitations. Determining whether claims may be asserted under the state blue sky laws and/or other potentially applicable laws is highly fact-specific and requires a careful analysis of, among other things, the applicable disclosure documents. Keller Rohrback is available to review the materials provided to investors in connection with the sale of each relevant security, to consult with personnel who are familiar with the investments in those securities, and to prepare a detailed analysis with a careful assessment of investors’ rights and potential remedies.
Keller Rohrback currently represents the Federal Home Loan Banks of Boston, Chicago, and Indianapolis (“FHLBs”) in litigation against dozens of issuers, underwriters, and sponsors of PLMBS. The relief sought by the FHLBs includes rescission and damages under state blue sky laws and the federal securities laws, negligent misrepresentation, interest, and attorneys’ fees and costs. The complaints name over 120 defendants and involve over 200 securities with an original face value of $13 billion.
Keller Rohrback enjoys a national reputation for excellence in prosecuting securities claims on behalf of injured shareholders. These cases typically assert claims against at least one corporate defendant, its officers and directors, its underwriters, and/or its auditors. The firm relies upon the strong business and financial background of its attorneys. This expertise, along with the use of knowledgeable experts and state-of-the-art technology, contributes to Keller Rohrback’s successful securities fraud practice.
In recognition of Keller Rohrback’s strong performance, courts have appointed the firm to leadership positions in a number of cases and firm attorneys consistently strive to achieve outstanding results. For example, in the IKON securities litigation, Keller Rohrback, as co-lead counsel, was instrumental in negotiating a partial settlement of $111 million. Additional securities cases in which Keller Rohrback has played or continues to play a leadership role include the 2TheMart.com, Inc., Adams Golf, Inc., Anicom, Inc., Scientific Atlanta, Inc., and United Companies Financial Corporation litigations, in which shareholders allege the purchase or acquisition of shares at artificially inflated prices.
Securities lending is a service typically offered by asset managers to their institutional clients. The bank or asset manager’s clients lend out their shares to other people in order to receive interest income on the loan. Securities lending is a common practice for institutional investors including mutual funds, insurance companies, pension plans, and others with large investment portfolios who are seeking to earn incremental returns on their portfolio to aid in covering their investment management fees. When the loan is made, the borrower is required to provide the lender with collateral in the form of cash or other securities of equivalent value. Prudent and conservative investment of the cash collateral is required so that it can be returned to the borrower at the conclusion of the loan. As payment for the loan, the parties negotiate a fee for the value of the loaned securities. For this reason, it is imperative that the bank or asset manager also aggressively negotiate and monitor the fees for the loaned securities.
Keller Rohrback represents institutional investors and is co-lead counsel on behalf of public pension funds in ongoing litigation against Northern Trust Investments, N.A. alleging that Northern Trust imprudently invested its clients’ cash collateral in risky and long-term securities and breached its legal and contractual obligations to its clients.