Firm Obtains Landmark Ruling From New York’s Highest Court That The Martin Act Does Not Preempt Investors’ Common-Law Tort Claims
December 20, 2011
On an issue of major significance to investors, the Firm obtained a landmark ruling from New York’s highest court, on behalf of its client Assured Guaranty (UK) Ltd., that New York’s “blue-sky” law, known as the Martin Act (N.Y. Gen. Bus. Law sections 352-59), does not preempt investors’ common-law claims for breach of fiduciary duty and gross negligence. [Assured Guaranty (UK) Ltd. v. J.P. Morgan Investment Management, Inc., No. 227 (NY Court of Appeals, decided Dec. 20, 2011)]. In reporting on the decision, the New York Law Journal stated that “the Court of Appeals doused what had been conventional wisdom in other state and federal courts, and handed a significant consumer victory to investors . . .” NYLJ, dated December 21, 2011, at p.1. Specifically, the New York Court of Appeals unanimously “agree[d] with plaintiff that the Martin Act does not preclude a private litigant from bringing a nonfraud common-law cause of action.” Slip Op. at 7.
A copy of the decision is available here.
A video of Bill Maher’s oral argument before the New York Court of Appeals on November 15, 2011 is available here.