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Paul, Weiss is widely recognized as having one of the nation’s preeminent securities litigation and regulatory practices. For two decades, our lawyers have guided global corporations and financial institutions through a series of “bet-the-company” securities-related crises, consistently reducing or eliminating their most damaging claims and negotiating favorable resolutions.

Court Dismisses Civil RICO Claims Against SAC Capital

Paul, Weiss client SAC Capital won a significant victory when Judge Victor Marrero of the United States District Court for the Southern District of New York dismissed civil RICO claims brought by a series of investors in two publicly traded companies, Elan Corporation and Wyeth. Plaintiffs sought over a billion dollars in trebled damages based on their allegations that SAC Capital violated the RICO statute through insider trading in shares of Elan and Wyeth from 2006 to 2008. Judge Marrero held that the plaintiffs' claims were barred by the Private Securities Litigation Reform Act of 1995 (PSLRA), which precludes civil RICO claims based on a predicate act of securities fraud unless the defendant has been convicted "in connection with" the fraud. Judge Marrero agreed with SAC Capital's argument that it had not been convicted of securities fraud "in connection with" trading in Elan and Wyeth since, in its 2014 criminal plea, SAC Capital did not allocute to any Elan- or Wyeth-related conduct. The decision is one of only a handful in the country interpreting the scope of the so-called "criminal conviction exception" to the PSLRA, and will serve as important precedent in future civil RICO cases.

The Paul, Weiss team included litigation partners Daniel Kramer, Ted Wells, Michael Gertzman, Marc Falcone and Audra Soloway and counsel Jonathan Hurwitz.

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