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Second Circuit Review: Federal Sway Boosted Over State Securities Class Actions
June 25, 2008 Full PDF
Litigation partners Marty Flumenbaum and Brad Karp's "Second Circuit Review" column appeared in the June 25 issue of the New York Law Journal. The article discusses Estate of Pew v. Cardarelli, in which the U.S. Court of Appeals for the Second Circuit bolstered federal court jurisdiction over securities class actions brought under state law. The court narrowly construed a securities law exception to the Class Action Fairness Act general grant of federal removal jurisdiction. The court ruled that a state-law securities class action that otherwise satisfies the relatively low jurisdictional threshold for federal removal under the Class Action Fairness Act (CAFA) will not be remanded to the state court solely because the lawsuit relates in some way to any securities. In order to fit within the exception allowing remand, the lawsuit must concern the rights, duties and obligations that are grounded in the terms of the securities themselves. Litigation associate Nima Taylor Binara assisted in the preparation of this column.