- Learn More
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.
Paul, Weiss Wins Dismissal of New Jersey False Claims Act Lawsuit
- Client News
- May 6, 2019
Paul, Weiss secured a victory for Citigroup Inc. and Citigroup Global Markets Inc. when New Jersey False Claims Act claims against them were dismissed without prejudice.
The plaintiffs, private individuals suing on behalf of the state of New Jersey, filed an action alleging that Citi and other municipal bond underwriters defrauded the state by falsely representing that they would underwrite the state’s bonds so as to obtain the “best price” and “lowest yield” on those bonds. On December 21, 2018, Paul, Weiss moved to dismiss for failure to state a claim, and the court granted the motion. The plaintiffs filed an amended complaint, which Paul, Weiss again moved to dismiss. Again, the Superior Court of New Jersey granted the motion, holding that the plaintiffs failed to plead their claims with the heightened particularity required by the New Jersey False Claims Act and the particular requirement of Federal Rule of Civil Procedure 9(b), which applies in False Claims Act cases. The court noted specifically that the operative complaint failed to contain any particularized allegations showing that defendants’ representations were false. Rather, the court observed that “the claims of falsity all rest on impermissible conclusory allegations,” and that “scienter cannot be based on pure conclusions.” The court added that the plaintiffs relied on many forward-looking statements and expressions of opinion, which were not actionable under New Jersey’s pleading requirements.
The Paul, Weiss team included litigation partners Susanna Buergel and Jane O’Brien.