Securities INDUSTRIES

WilmerHale’s securities practice of more than 200 lawyers offers premier enforcement, litigation and regulatory capabilities, and is widely recognized for its experience in all aspects of capital markets, investment management, broker-dealer and financial services regulation.

Recognized for providing “superior levels of service response time, business acumen, securities law expertise, and strength and depth of team” (Legal 500 US 2013), and “widely considered to be a market leader with outstanding expertise and knowledge of the securities regulatory arena” (Chambers USA 2013), WilmerHale has played a central role in a number of prominent US federal and state securities investigations and regularly represents companies, directors and senior management in governmental and internal investigations. On behalf of committees of outside directors, we conducted the investigations of Enron, Qwest, and WorldCom, and we represented the Special Committee of the Board of Directors in the Securities and Exchange Commission’s (SEC) UnitedHealth options backdating inquiry. For every high-profile securities investigation we have handled, there are many others in which we represented the company or an officer with no charges made.

Our team has earned a national reputation—based on our defense of major class actions—as a leading defender of individuals and companies named in federal or state court by private litigants. We have handled the full spectrum of securities litigation matters, from cases relating to IPO allocation practices, excessive management fees, mutual fund market timing, insider trading, accounting fraud, market manipulation and insurance sales practices, to challenges to our clients’ business judgment in derivative actions, corporate control contests, proxy fights and other corporate governance disputes.

Our enforcement and litigation capabilities are complemented by our strength in all aspects of securities regulation. Our broker-dealer, financial services and investment management lawyers have navigated some of the most complex regulatory challenges faced by domestic and international market participants, and have played a pivotal role providing regulatory advice to clients—including investment banks, investment advisers and companies, as well as hedge funds and other alternative investment vehicles—in the current financial crisis.

Our clients rely on the valuable insight of a team of seasoned lawyers who have many years of experience working on the most complex securities matters. Among this experienced group, we count a former SEC Director of Enforcement, a former Chief Litigation Counsel for the Division of Enforcement of the SEC, a former Director of the Division of Corporation Finance of the SEC, a former Regional Director of the Pacific Regional Office of the SEC, a former SEC General Counsel and SEC Deputy General Counsel and a former Chief Counsel of the Division of Economic Analysis, now the Division of Market Oversight, and a former General Counsel at the Commodity Futures Trading Commission.

WilmerHale’s securities practice of more than 200 lawyers offers premier enforcement, litigation and regulatory capabilities, and is widely recognized for its experience in all aspects of capital markets, investment management, broker-dealer and financial services regulation.

Recognized for providing “superior levels of service response time, business acumen, securities law expertise, and strength and depth of team” (Legal 500 US 2013), and “widely considered to be a market leader with outstanding expertise and knowledge of the securities regulatory arena” (Chambers USA 2013), WilmerHale has played a central role in a number of prominent US federal and state securities investigations and regularly represents companies, directors and senior management in governmental and internal investigations. On behalf of committees of outside directors, we conducted the investigations of Enron, Qwest, and WorldCom, and we represented the Special Committee of the Board of Directors in the Securities and Exchange Commission’s (SEC) UnitedHealth options backdating inquiry. For every high-profile securities investigation we have handled, there are many others in which we represented the company or an officer with no charges made.

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Contacts

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McLucas, William R.

William R. McLucas

Chair, Securities Department

+1 202 663 6622 (t)

william.mclucas@wilmerhale.com

Avakian, Stephanie

Stephanie Avakian

Vice Chair, Securities Department

+1 212 230 8845 (t)

stephanie.avakian@wilmerhale.com

Davison_Doug_lo.jpg

Douglas J. Davison

Vice Chair, Securities Department

+1 202 663 6690 (t)

douglas.davison@wilmerhale.com

Robinson, Andrea J.

Andrea J. Robinson

Vice Chair, Securities Department

+1 617 526 6360 (t)

andrea.robinson@wilmerhale.com

Experience

We bring unparalleled breadth and depth of experience to matters involving the securities markets. Our team includes former officials from the Securities and Exchange Commission, Commodity Futures Trading Commission, Department of Justice, Federal Bureau of Investigation, Federal Reserve Board and the Financial Conduct Authority of the UK.

Our approach is collaborative. Combining our diverse expertise into pragmatic solutions, together we have:

  • Counseled clients in hundreds of matters before the DOJ, SEC, NASD, NYSE, AMEX, state regulators and Congress, in the past five years alone
  • Defended more than 300 separate securities and market conduct class actions in the last decade
  • Established, registered and represented more than 200 open-end and closed-end funds with a wide variety of investment objectives and policies, including the representation of nine closed-end investment companies in initial public offerings in 2003 and 2004 with total proceeds of over $4.6 billion in the last 18 months
  • Served as counsel to over 70 mutual fund groups, over 50 registered investment advisers, over 50 broker-dealers and over 50 hedge fund managers
  • Navigated some of the most complex regulatory issues facing capital market issuers, underwriters, broker-dealers, investment companies and advisers, and other domestic and international market participants

Publications & News

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April 22, 2014

SEC Staff Issues First Set of FAQs on Rule 15c3-5, Risk Management Controls for Brokers or Dealers with Market Access

On April 15, 2014, the Staff of the SEC’s Division of Trading and Markets issued its first set of frequently asked questions (FAQs) regarding Rule 15c3-5 under the Securities Exchange Act of 1934.

April 8, 2014

WilmerHale Shortlisted for Chambers USA Award for Excellence in IP, Securities and Financial Services Regulation

WilmerHale's Intellectual Property and Securities Departments, and its IP Litigation, Securities Litigation and Enforcement, Broker-Dealer and Financial Institutions Groups have received special recognition by Chambers USA as part of this year's Awards for Excellence program.

April 4, 2014

Some prefer litigation when the SEC calls

An article by Michael Mugmon and Chris Johnstone, published in the April 4, 2014 edition of The Daily Journal.

March 26, 2014

SEC Approves New Consolidated FINRA Supervision Rules and FINRA Establishes an Effective Date

Last week, FINRA issued a Regulatory Notice describing changes to its supervision rules and announcing an effective date of December 1, 2014.

March 13, 2014

Supreme Court Issues Decision Analyzing Whether Misrepresentation is “in Connection with” Purchase or Sale of Covered Security

On February 26, 2014, in Chadbourne & Parke LLP v. Troice et al.,1 the Supreme Court narrowed the definition of “in connection with” as that term is used in the Securities Litigation Uniform Standards Act of 1998 (SLUSA).

March 12, 2014

Top Five SEC Enforcement Events in 2013

An article by William McLucas, Douglas Davison and Lesley Fredin, published in the March 2014 edition of Financial Fraud Law Report.

March 11, 2014

US Supreme Court Upholds Broad Scope of Sarbanes-Oxley Act Whistleblower Protection

Last week, the US Supreme Court issued an important decision addressing whether Section 806 of the Sarbanes-Oxley Act of 2002 (SOX) (codified at 18 U.S.C. § 1514A) limits protection from retaliation to the employees of public companies, or if it also covers employees of contractors to a public company.

February 20, 2014

Update: SEC's Financial Reporting and Audit Task Force

On February 11, Margaret McGuire, Vice Chair of the US Securities and Exchange Commission's (SEC) Financial Reporting and Audit Task Force (Task Force), participated in a DC Bar panel discussion to review the objectives, administration and early initiatives of the Task Force since its formation was announced by the SEC last July.

February 6, 2014

2013 CFTC Enforcement Year-in-Review, and a Look Forward

In recent years, the Commodity Futures Trading Commission (“CFTC” or “Commission”) has brought cases of ever-greater significance, against respondents with greater name recognition, for consistently increasing civil monetary penalties.

February 5, 2014

Global Anti-Bribery Year-in-Review: 2013 Developments and Predictions for 2014

The year 2013 witnessed several notable developments in the enforcement of the Foreign Corrupt Practices Act (FCPA). In 'Global Anti-Bribery Year-in-Review: 2013 Developments and Predictions for 2014', WilmerHale Partners Roger M. Witten, Kimberly A. Parker, Jay Holtmeier and Erin G.H. Sloane discuss notable trends and developments in 2013 corporate settlements and individual prosecutions, key FCPA legal developments, notable collateral litigation developments, and significant developments in international anti-corruption law.

Recognition

  • Chambers USA has consistently ranked WilmerHale in the top tier among firms nationwide for securities regulation work. "WilmerHale well deserves its reputation for having a high-caliber practice,” states the 2012 guide. William McLucas is recognized as a star individual, and cited by clients as "the best securities lawyer in the country” and called “sharp as a tack … his connections are almost unparalleled." In addition, Harry Weiss is cited as a "phenomenal attorney" who "brings a specific skill set you can't get from other people," and Jeffrey Rudman is called out for his "tremendous level of knowledge."
  • The 2012 edition of The Legal 500 United States cites WilmerHale’s "widespread recognition for its preeminent enforcement practice,” and acknowledges the firm’s “market leading niche in SEC enforcement issues.” Our department is recognized by the guide in the alternative/hedge funds, mutual/registered funds and shareholder litigation categories.
  • In the 2012 Best Law Firm rankings by U.S. News Media Group/Best Lawyers, our mutual funds law and private funds/hedge funds law practices are ranked in the first tier nationally and in New York; and our securities capital markets law practice is ranked in the first tier nationally and in Boston and Washington DC. Additionally, our securities regulation practice is ranked in the first tier nationally and in Washington DC, and our securities litigation practice was ranked in the first tier nationally and in Boston and New York. In 2011, WilmerHale was named "law firm of the year" in securities litigation.
  • Fifteen securities lawyers were recognized for their work in their respective fields, and selected by peers for inclusion in the 2013 edition of The Best Lawyers in America. In 2009, the guide named William McLucas "Washington DC Securities Lawyer of the Year."
  • Washingtonian magazine named four WilmerHale lawyers to its “Stars of the Bar” list in 2012, including Yoon-Young Lee, William McLucas, Harry Weiss and Laura Wertheimer.
  • In 2012, Practical Law Company (PLC) recommended WilmerHale nationally in the area of investment funds: registered/mutual funds. In addition, James Anderson was recommended as a "Leading Lawyer.”
  • WilmerHale was named one of five "Securities Defense Firms of the Year” for 2009 by the editors of Law360—one of the nation’s leading publishers of legal news and information.

2012 Highlights

Our Securities Department continued to work with our clients to respond to some of the most sensitive and high-stakes government investigations into the banking and financial services industry. We assisted in the successful resolution of a number of multi-year enforcement investigations, with no charges filed, and fielded sophisticated cross-disciplinary teams to address ongoing matters spanning multiple continents, and involving multiple government agencies and regulatory bodies. Among many other significant matters, we secured the dismissal of a number of securities class action lawsuits; successfully defended clients in lawsuits seeking to enjoin merger transactions; and continued our pro bono representation of a Washington DC–based children’s charity that lost half of its endowment to a Ponzi scheme in the wake of the global financial crisis. Below is a selection of our 2012 highlights:

  • We represented the Audit Committee of Best Buy in an internal investigation into allegations of inappropriate conduct by the company’s then-CEO Brian Dunn. We have continued to provide the board with counsel on a variety of corporate governance, disclosure, transactional, employment law and securities matters in the aftermath of the investigation.
  • The Royal Bank of Scotland Group PLC and various officers and directors of the bank turned to us for representation in two securities class actions brought under the Securities Act and Securities Exchange Act alleging false or misleading statements in connection with structured asset holdings and valuations, capital adequacy, risk controls, and the acquisition and integration of a European bank. We obtained decisive victories when the Southern District of New York dismissed the complaints against our client, with prejudice.
  • We achieved a significant win for PwC Canada when the US District Court for the Southern District of New York granted our motion to dismiss, without leave to replead, in a long-running litigation involving allegations of accounting fraud at Fairfax Financial.
  • We continued our representation of venerated Washington DC–based social services organization Hillcrest Children’s Center, which in 2009 became the victim of a Ponzi scheme in which it lost about one half of its endowment. The firm filed suit in federal court in DC in 2011, and the SEC followed with its own suit against the principal malefactors. In 2012, Hillcrest reached a settlement with five defendants, including the law firm and attorney that represented the entity that orchestrated the Ponzi scheme. In addition, Hillcrest secured a default judgment against Garfield Taylor and the Gibraltar entities for the entire amount of Hillcrest’s losses.
  • We successfully closed a more-than-10-year-old SEC securities fraud investigation and subsequent federal court enforcement action against our client, the former general counsel and executive vice president of business development at Cabletron Systems, later known as Enterasys—at the time, a more than $1 billion computer networking company. We litigated and won all of the SEC's fraud and primary securities claims against our client, and the SEC settled the rest without any payment by or sanction against our client.
  • We achieved another in a string of victories for DryShips, a shipping company based in Athens, Greece, and incorporated in the Marshall Islands, when the US District Court for the Eastern District of Missouri dismissed a securities fraud class action suit against the company, its board, and senior management. This result follows the November 2011 dismissal of a shareholder derivative suit against the company in the Republic of the Marshall Islands, a judgment that was subsequently affirmed by the Supreme Court of the Marshall Islands.
  • Our lawyers secured a notable victory for home health care service provider Almost Family when the Western District of Kentucky dismissed a class action lawsuit alleging a scheme to defraud Medicare, finding that the plaintiffs had failed to sufficiently plead material misrepresentation or loss causation. We continue to represent Almost Family in the related SEC investigation and a derivative action in state court.
  • We achieved a major success for Berkshire Hills Bancorp in Connecticut Superior Court when, after a one-day trial, a judge denied a motion for preliminary injunction to enjoin our client’s acquisition of The Connecticut Bank and Trust Company, and dismissed all of the plaintiffs’ claims against Berkshire.
  • We successfully defended Central Bancorp and its directors in a putative stockholder class action lawsuit seeking to enjoin a proposed merger with Independent Bank Corp.
  • We helped Sonus Networks complete its successful acquisition of Network Equipment Technologies, thwarting a challenge to the merger and enabling the deal to close with minor additional disclosure and settlement.

Volcker Rule Resources

On December 10, 2013, the Federal Banking Agencies, together with the SEC and CFTC, adopted a Final Rule to implement Section 13 of the Bank Holding Company Act (the Volcker Rule), which was added by Section 619 of the Dodd-Frank Act.

Our Securities and Financial Institutions teams have compiled for you these relevant resources to help reinforce your understanding of the Volcker Rule.

WilmerHale Publications

Statutory and Rule Text

Agency Statements

Federal Reserve Statements on the Volcker Rule, December 10, 2013

FDIC Statements on the Volcker Rule, December 10, 2013

OCC Statement on the Volcker Rule, December 10, 2013

SEC Statements on the Volcker Rule, December 10, 2103

CFTC Statements on the Volcker Rule, December 10, 2103