Banking and Financial Services
Creative solutions, far-seeing risk avoidance counsel, and the practical understanding of experienced litigators—that is what banks, investors, and other clients in the financial sector know they can count on when they turn to Goldberg Segalla. The firm’s Banking and Financial Services practice provides companies and professionals in the sector with experienced representation in matters ranging from business litigation and liability claims to D&O issues and regulatory compliance.
Our clients include:
- Asset managers
- Asset-based lenders
- Captive insurance companies
- Corporate issuers
- Credit unions
- Financial institutions
- Insurance and reinsurance companies
- Investors and investment companies
- Mortgage companies
- Private equity sponsors
- Public and private corporations
- Title insurance companies
Comprehensive Counsel for Financial Institutions
Our work and our reputation in the financial sector are underwritten by our understanding of the people, parties, and industry forces at play. This enhances our ability to guide clients through the subtleties of any matter and to emerge on the other side with their goals accomplished—legal risks in the rearview and future successes in sight.
Our attorneys serving banking and financial institutions often work with members of our Corporate Law and Transactions, Antitrust and Competition, Management and Professional Liability, and Commercial Litigation and Arbitration teams to offer a full range of services for any scenario. Though we handle a significant volume of complex litigation, our banking and financial clients also call on us for counsel on sophisticated statutory and regulatory compliance issues, as well as for counsel in transactions and other corporate matters.
A Collaborative Approach to Banking and Financial Counsel
We stand firmly against the “Big Law” practices—like “stacking” attorneys and assembling needlessly large teams—that boost billable hours and coerce clients into greater legal spending. However, when you retain one of us, you are collaborating with the entire firm. With over 400 attorneys at the firm, many of them leaders in their areas of business and the law, our clients benefit from an intelligence network that spans industries, disciplines, and Goldberg Segalla’s international footprint.
When our veteran commercial litigators represent clients in actions involving operating agreements, partnership disputes, or other commercial matters, they turn to the attorneys on our Banking and Financial Services team for insight into causes of action, notice requirements, remedies, and potential ramifications. And when our attorneys identify areas of concern in due diligence, they can rely on the attorneys in our Intellectual Property, Employment and Labor, and Commercial Litigation and Arbitration groups to assess the risks and help plot the safest course forward. We are proud that this approach has made a difference for our clients.
We have successfully resolved commercial disputes involving complex business agreements and partnership dissolution, and the litigators on our Commercial Litigation and Arbitration team regularly assist in counseling clients regarding transactions that may be affected by ongoing litigation.
Some recent matters include:
- Litigated propriety of payment issues involving a letter of credit on behalf of a major U.S. financial institution
- Defended a U.S. financial institution in fraud-based dispute relating to failed financing for real estate development projects
- Defended a UK bank in residential mortgage-backed securities (RMBS) representation and warranty lawsuits filed by trustees and liquidating trusts involving billions in loans
- Advised a leading bank regarding a collateral pledge of a residential building involved in ongoing litigation
- Advised a major financial institution regarding claims by safe deposit box customers alleging loss arising from property damage following Superstorm Sandy
- Represented an insurance company in a securities fraud case alleging senior executives purposefully manipulated client’s loss reserves and deferred tax liabilities and underestimated the discount rate for its life insurance policies
- Represented the credit arm of an automotive manufacturer in actions against various guarantors of defaulted car dealership loans
- Represented a U.S. financial institution that served as trustee in several litigations between stakeholders to collateralized debt obligations (CDO)
- Defended an insurance company and its directors and officers in a securities fraud class action and derivative lawsuits
- Represented a U.S. financial institution in residential mortgage foreclosure actions
- Successfully brought claims on behalf of a U.S. financial institution in a commercial lawsuit for fraudulent transfer of real property, which included the pursuance of claims for conversion, accounting, and slander of title
- Represented a U.S. financial institution in an action to quiet title of real property
- Represented a U.S. financial institution in commercial blight lien action where municipality seeks possession of real property as well as fees and costs
- Successfully represented a U.S. financial institution in a commercial lawsuit for claims made for specific performance in connection with a sale of real property
- Represented a U.S. financial institution in action to pursue commercial claims against third party for fraud, conversion, breach of contract, and unjust enrichment
Our national Management and Professional Liability practice has a particularly deep bench of attorneys with decades of experience serving the financial industry, where companies, officials, and independent practitioners like broker-dealers and investment advisers face civil and administrative litigation under federal and state consumer, securities, and banking laws and regulations. Philadelphia-based partner Seth L. Laver, chair of the Financial Services Subcommittee of the ABA/TIPS Professional Liability Insurance Committee, oversees this team counseling the banking and financial services sector on management and professional liability issues nationwide.
We represent clients in securities litigations and Financial Industry Regulatory Authority (FINRA) arbitrations nationwide, and counsel clients through issues involving the full spectrum of securities industry-specific claims, investigations, and enforcement actions. With an authoritative understanding of the applicable regulations and an unsurpassed knowledge of how to navigate the process of arbitration and regulatory inquiries, we help clients minimize the impact of regulatory enforcement and customer complaints. Our services include:
- Providing legal counsel during regulatory inquiries
- Defending clients under investigation for regulatory matters
- Guiding clients through the arbitration process
- Using alternative dispute resolution methods to obtain quick settlements of claims
- Assessing and advising clients on evolving FINRA and other self-regulatory organizations (SROs) rules, regulations, and procedures
We have represented banking and financial clients in litigation concerning the Uniform Commercial Code (UCC) and numerous state laws, as well as FINRA arbitrations, and involving allegations of:
- Fraud (e.g., common law, securities, ERISA, mortgage)
- Tax evasion
- Ponzi schemes
- Money laundering
- Breach of fiduciary duty
- Unsuitable investment recommendations
- Improper sales practices
- Negligent misrepresentation, hiring, and supervision
- Employee dishonesty
- Directors and officers liability
- Check kiting
- Safe deposit box loss
PROFESSIONAL LIABILITY DEFENSE AND INVESTIGATIONS
As a top-choice professional liability defense team, we regularly represent financial institutions, broker-dealers, independent investment advisers, asset managers, and other practitioners in sensitive and high-stakes litigation, at trials, and in all forms of alternative dispute resolution (ADR). Our partners have extensive experience handling all manner of claims brought against registered representatives and investment advisors, including claims involving both failure to make suitable investments, fraud, and churning. We have handled claims arising from the dot.com bubble and the Great Recession, as well as claims involving alleged failure to generate better returns in more favorable stock market environments. Our record of successful defenses and favorable results rests on our extensive knowledge of the business of finance, securities, and asset management, and our commitment to gaining an intimate understanding of each client’s operations, history, philosophy, and long-term goals. At the same time, we leverage outside resources and investigative experience to gain a parallel understanding of the plaintiff’s background and business, allowing us to master and mount a superior defense against each claim.
SUBPOENAS AND INQUIRIES
Financial professionals are frequently subjected to third-party subpoenas and other inquiries related to civil matters, federal and state grand juries, and administrative actions. We understand the impact that these events can have on business—and the potential pitfalls and exposures that might arise as a result. We frequently handle, defend against, and guide clients through such inquiries, subpoenas, and third-party investigations, dispatching each matter with sensitivity, foresight, discretion, and diplomacy. Our clients can trust that we will take every available measure to protect them from risks and exposures, mitigate business interruptions, preserve their confidence with clear and prompt communication, and work collaboratively and strategically to eliminate or minimize reputational impact.
DIRECTORS AND OFFICERS DEFENSE
Our team represents directors and officers in high-value disputes throughout the United States, in both federal and state courts, and around the world, and acts as trusted counsel providing timely and proactive advice on the full spectrum of risk-avoidance issues and emerging concerns relevant to directors and officers in virtually any industry. With our deep understanding of the unique business and liability risks in the financial sector, we are particularly well positioned to counsel and defend the directors and officers of financial institutions, asset management firms, and related organizations. Whenever events occur in the life of a company that could make shareholders, customers, employees, or regulators unhappy, or could otherwise catch the attention of plaintiffs’ lawyers, directors and officers and their insurers call on Goldberg Segalla.
INSURER E&O AND BAD FAITH
Our practice includes one of the foremost expert witnesses on insurer E&O and bad faith issues: Thomas F. Segalla, editor of Couch on Insurance, has testified in more than 40 jurisdictions as an expert witness on bad faith. Goldberg Segalla attorneys understand that the issue of how an insurer handles a claim or a request for coverage has become as important as the threshold issue of whether there is coverage at all. While most insurance litigation concerns issues of contract law, insurers often face claims in tort or under statutes alleging bad faith—either in interpreting the insurance contract or in the manner the claim was handled.
We address insurer E&O and bad faith claims with proactive management from day one. We use early motion practice to dismiss bad faith and extra contractual claims at the onset of litigation, thereby ensuring the proper confines of discovery. At the onset, we identify and interview key employees, assess all documentation, and involve necessary experts. Our experience includes defeating motions to amend complaints to include bad faith claims, securing summary judgment on third-party bad faith claims, securing dismissal of first-party extra contractual claims, and successfully asserting that any bad faith claims and discovery regarding these claims must await an initial finding of coverage. We also frequently advise insurers on bad faith risk management and best practices.
PROACTIVE RISK MANAGEMENT
We do not just defend E&O claims—we actively assist our clients in trying to prevent them. We are committed to providing financial institutions and professionals and their E&O insurers with cutting-edge, practical E&O loss-control advice and to help them implement those techniques. We are also available to represent broker-dealers, financial advisers, and the directors and officers of financial institutions outside of an insured claim, including with respect to E&O and D&O loss-control and prevention seminars and audits.
- Obtained a favorable settlement for a hedge fund whose principal was convicted and jailed for securities fraud in a matter involving a corporate monitor, who was appointed to liquidate the fund, allegedly failed to detect and report the fraud
- Successfully defended a financial D&O claim involving alleged misuse of a large nonprofit donation
- Achieved a voluntary discontinuance in a D&O claim through aggressive motion practice and effective oral arguments in a matter involving allegations of fraud, breach of contract, and promissory estoppel
- Earned a dismissal for a collateral manager against a $55 million E&O claim in a matter involving a hedge fund investor who brought claims of breach of contract and breach of fiduciary duty related to the method for calculating the rate of return, and demanded punitive damages, after our client had received a $7 million fee based upon the performance of a collateralized loan obligation
- Representing an investment advisor in a claim involving a victim of social engineering who was manipulated into withdrawing all of the funds from her retirement account, and now contends her investment advisors did not undertake sufficient efforts to stop her
- Earned summary judgment dismissal of an attempted class-action lawsuit against a credit union, saving our client from what could have been costly and potentially prolonged litigation; on top of the class-action issues, the case required addressing a complex array of issues including collateral placement of insurance, coverage issues, insurance and banking regulations, and unfair business practice claims under the General Business Law
- Secured the dismissal of a $50 million securities class-action complaint filed against a bank, its securities underwriters, and its outside auditor in the U.S. District Court for the Middle District of Pennsylvania in a matter involving alleged violations of Section 10(b) and Section 11 of the Exchange Act
- Represented a private equity fund in a Department of Justice investigation involving questions related to price fixing and market allocation
- Represented a hedge fund employee in an SEC enforcement action
For almost a decade, Goldberg Segalla’s Banking and Financial Services team has represented clients including the industry leader of the U.S. mortgage market in a variety of complex and high-stakes general liability matters. Our team’s success in this field is based on knowing every detail about our clients’ business practices, understanding how federal and state law impact those business practices, and using our knowledge of the law to achieve consistent, favorable results.
Our team’s success in representing companies in multimillion-dollar claims comes from aggressive motion practice to dismiss our clients cases in the early stages. It’s also centered around filing motions and pleadings with the court that invoke fee shifting, indemnity, and recovery of legal fees for our clients based on the contractual obligations of the responsible third parties.
Our experience includes defeating punitive and treble damages claims, as well as claims based on fraud, breach of contract, conversion, and wrongful eviction. We actively seek to shift risk away from our clients by identifying insurance policies that are available for financial and banking clients for hazards and commercial losses. We use the contracts that our clients have created for their own protection to seek the indemnity, defense, and dismissal of our clients by asking the courts to enforce the plain language of the contracts.
- Represented a U.S. financial institution against claims involving ejectment, wrongful eviction, and eviction by illegal forced detainer
- Defended a major U.S. financial institution in a multimillion-dollar commercial claim for invasion of privacy, trespass and conversion, where the plaintiff also sought punitive damages
- Successfully represented a U.S. financial institution against claims involving intentional and negligent misrepresentation
- Successfully represented a U.S. financial institution in a quiet title action to establish ownership of real property
- Successfully represented a U.S. financial institution in a commercial lawsuit for claims brought by a building owner for alleged fees and costs owed for damage to commercial property
- Successfully received a dismissal of a U.S. financial institution, in a case of first impression in New Jersey, by using the “as-is”, warranty, and indemnity agreements in a contract of sale for a foreclosure property to bar claims made by the purchaser
Our Banking and Financial Services team regularly advises clients on general securities and corporate law as well as other regulatory matters, including ongoing disclosure obligations and corporate governance issues under U.S. federal securities laws and applicable state laws. We have advised clients in compliance matters and administrative proceedings, guided them through internal investigations, and represented them in government inquiries, including matters involving the Federal Deposit Insurance Corporation (FDIC), the Consumer Financial Protection Bureau (CFPB), the Securities and Exchange Commission (SEC), and the Office of Foreign Assets Control (OFAC).
In addition, several of our attorneys handle issues concerning consumer fraud, the Dodd-Frank Act, the Foreign Corrupt Practices Act, the Sherman Anti-Trust Act, Racketeer Influenced and Corrupt Organizations Act (RICO), and the UK Bribery Act. Members of our team frequently publish on these subjects in legal, financial, and insurance industry publications and present on them to clients.
Recent matters include:
- Acting as a principal advisor to an international geo-political consulting firm regarding FCPA and UK Bribery Act compliance and creating a related employee handbook
- Advising a financial institution regarding the Bank Secrecy Act, Section 326 of the U.S. Patriot Act, and the FCPA and creating a related anti-corruption policy guide after investigating banking transfers and other practices
- Representing an individual and a consortium in an FCPA enforcement action stemming from allegations of international bribery of Nigerian officials
- Representing a U.S.-based bank with respect to data privacy issues and purported breach
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