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Practice/Industry Group Overview
Leading financial services firms worldwide seek out Winston & Strawn for practical counsel that addresses their long-term business goals and daily operating challenges. We assist clients in bank regulatory and compliance, investment management, structured products, private funds, derivatives, broker-dealer, futures/exchange, securitization, corporate lending, and SEC investigations and litigation. Our financial services clients include major money-center banks in the United States, United Kingdom, and other countries, the largest bond manager in the world, the largest index fund manager in the United States, a AAA-rated Dutch banking conglomerate, several of the world's largest hedge funds, and many other large investment management firms.
Our cross-disciplinary approach to transactional and project-specific matters for our financial services clients encompasses regulatory compliance counseling, tax advice, dispute resolution, and representation before applicable regulatory authorities. By tapping into our firmwide resources in litigation, real estate, employment law, employee benefits, tax, intellectual property, and government relations, Winston is able to provide comprehensive services to our financial services clients beyond the transactional and regulatory work that is typical of most banking and securities practices.
Representative Matters
HealthSouth Securities Class Action
Ernst & Young
Winston & Strawn represents Ernst & Young (E&Y) in a securities class action pending in the Northern District of Alabama. Stockholders and bondholders of HealthSouth Corporation brought claims against E&Y under Section 10(b) of the Exchange Act and Section 11 of the Securities Act. E&Y was the outside auditor for HealthSouth, whose former officers have pled guilty to artificially inflating HealthSouth's income statement and balance sheet by several billion dollars. The plaintiffs claim E&Y's audit opinion letter to HealthSouth's board of directors, which was included in HealthSouth's Form 10Ks, was materially false or misleading. Winston & Strawn also represents E&Y in an arbitration against HealthSouth relating to E&Y's audit and HealthSou
Thomas G. Ong v. Sears, Roebuck & Co. Inc.
Goldman Sachs & Co.
We represent Bear Stearns & Co., Credit Suisse Securities (USA), LLC, Goldman, Sachs & Co., Morgan Stanley & Co. Incorporated, Lehman Brothers, and Merrill Lynch & Co., Inc. in a purported securities class action arising from three 2002 debt offerings by Sears Roebuck Acceptance Corp. (SRAC) pending in the U.S. District Court for the Northern District of Illinois. The complaint alleges violations of Section 10b of the Exchange Act and Sections 11 and 12 of the Securities Act against SRAC, its parent, Sears Roebuck & Company, various officers and directors of those companies and the respective lead underwriters of the debt offerings. We successfully moved to dismiss the Section 11 and 12 claims against three of our clients in their entirety,
Establishment of dedicated licensed fund management company
We succesfully assisted a large French mutual insurance company in the establishment of a dedicated licensed fund management company with more than €2 billion under management.
Prime Group Realty Trust Shareholder Class Action
Prime Group Realty Trust
Winston & Strawn represented Prime Group Realty Trust (PGRT) and its controlling shareholder, The Lightstone Group, in a class action brought in Maryland state court by the Series B preferred shareholders of PGRT. The shareholders asserted claims of breach of contract against PGRT and claims of breach of fiduciary duty and unjust enrichment against Lightstone. The shareholders sought to recover a $100 million Liquidation Preference, alleging that this Preference was owed to them as part of the constructive liquidation of PGRT's assets and winding up of its business. In September 2007, the court granted PGRT and Lightstone's motion to dismiss the shareholders' complaint, with prejudice.
Van Arkel v. Discover Financial Services LLC
Morgan Stanley
Winston & Strawn litigators obtained a victory for client Discover Financial Services LLC in an adversary proceeding filed in the U.S. Bankruptcy Court for the Northern District of Illinois. This is also being hailed as a victory for credit card issuers against the litany of “billing error notice” cases that have been filed around the country. The plaintiff, a former Discover cardholder, alleged that our client violated the Fair Credit Billing Act (FCBA) by not properly investigating billing error notices she had sent to Discover, and claimed Discover did not have the right to assess her late fees and other financing charges because it had failed to provide her with all required disclosures prior to the opening of the account. Judge Black g
Morgan Stanley Joint Venture
Morgan Stanley & Co. Incorporated
Winston & Strawn represented Morgan Stanley in connection with a structured joint venture transaction with a major European financial institution.
Kanter v. Barella, 489 F.3d 170 (3d Cir. 2007)
MedQuist Inc.
Winston & Strawn represented MedQuist, a medical transcription service provider, in a derivative lawsuit asserting a claim for breach of fiduciary duty against our client, its majority shareholder, Philips, and ten current and former MedQuist board members arising from allegations that MedQuist had systematically overbilled its customers for medical transcription services. This action, brought in the District of New Jersey, was one of six class actions filed following a July 2004 press release in which MedQuist announced the findings of an independent review of its billing methods. The New Jersey district court dismissed the derivative suit against MedQuist for failure of the plaintiff to make a demand on the MedQuist board and plaintiff’s
Legg Mason Securities Arbitration
Legg Mason & Co. LLC
Winston & Strawn represented asset management firm Legg Mason in a lawsuit brought by the beneficiaries of three separate trusts alleging breach of contract, negligence, failure to supervise, suitability, breach of fiduciary duty, and misrepresentations and omissions. The claimants sought $6 million in actual damages and an unspecified amount of punitive damages. Prior to his death in 2002, the trustee of the trust at issue had bought and sold well over $50 million of securities. His daughter, a beneficiary of the trust, brought the case alleging that her father never would have invested in such risky securities. After eight days of arbitration hearings, a three-judge NASD arbitration panel dismissed all claims with prejudice against Legg M
National Foreign Trade Council, et al. v. Giannoulias
National Foreign Trade Council Inc.
Winston & Strawn represented the National Foreign Trade Council, eight municipal fire and police pension funds, and eight individual beneficiaries of public pension funds in a lawsuit challenging the constitutionality of the 2005 Illinois Act to End Atrocities and Terrorism in the Sudan (the Illinois Sudan Act). The Act prohibited the deposit of Illinois state funds in any financial institution failing to certify that neither it nor any of its borrowers did business related to the country of Sudan. It also prohibited public pension funds from investing in any company that has direct or indirect commercial connections to that country. Winston attorneys argued that the Illinois Sudan Act intruded on the federal government’s exclusive power o
Zawacki v. Discover Financial Services, Inc.
Discover Financial Services
Winston & Strawn obtained dismissal of a putative class action complaint brought against client Discover Financial in the Northern District of Illinois alleging that our client accessed credit reports in violation of the Fair Credit Reporting Act (FCRA). The named plaintiff alleged that a mailer from Discover offering a home equity loan failed to include a "firm offer of credit" as required by the FCRA and therefore her credit report was obtained without her consent. Based on the language of the mailer at issue, the court rejected the plaintiff's arguments and dismissed the claims against Discover prior to any discovery.
Plumbers & Pipefitters National Pension Fund v. Cisco Systems, Inc.
Cisco Systems, Inc.
Winston & Strawn was retained by Cisco Systems, Inc. to act as trial counsel for Cisco and 12 of its current or past executives and directors in defense of a nationwide securities fraud class action filed in the Northern District of California. The plaintiff-class was composed of all those who purchased Cisco securities between November 10, 1999 and February 6, 2001. The plaintiffs alleged that the defendants inflated the price of Cisco stock during the class period by, among other things, issuing overly optimistic earnings forecasts and engaging in improper accounting practices. The lawsuit asserted securities fraud claims in violation of Section 10(b), Rule 10b-5, and Section 20(a) of the Securities Exchange Act of 1934, and insider tradi
Morgan, et al. v. American General Finance, Inc.
American General Finance, Inc.
Winston & Strawn litigators recently obtained a victory for client American General Financial Services, Inc. in a putative class action filed in Alameda County, California (Oakland), alleging concealment and fraud in originating consumer loans when Judge Sabraw granted summary judgment on all claims of each of the four named plaintiffs. The plaintiffs sought to represent the massive group of every person who borrowed money from AGFS over a six-year period, but the class certification motion was averted when we obtained summary judgment. This case had seen two removals to the federal court and two interlocutory appeals — one to the Ninth Circuit on jurisdiction under the Class Action Fairness Act and one to the California Appellate Court on
Discover Alliance with JCB International
Discover Financial Services
An international team of Winston & Strawn attorneys represented Discover Financial Services in the negotiation of a major reciprocal alliance with JCB, the largest card issuer and acquirer in Japan. This alliance enables acceptance of Discover and PULSE cards in Japan and JCB cards on the Discover network in the United States.
Discover Alliance with LINK
Discover Financial Services
An international team of Winston & Strawn attorneys represented Discover Financial Services in the negotiation of major reciprocal alliance with LINK Interchange Network Ltd., which operates the UK cash machine network. Discover's alliance with LINK enables the 4,200 U.S. banks which participate in Discover's PULSE ATM network to offer their customers access to 58,000 cash machines across the UK, and enables LINK cardholders to access 250,000 PULSE ATMs in the United States.
Securities Exchange Commission v. Heartland Advisors et al.
William J. Nasgovitz
Winston & Strawn was retained to represent William Nasgovitz, president and chief executive officer of Heartland Advisors, Inc., in a civil enforcement action brought by the Securities and Exchange Commission in the Eastern District of Wisconsin. The SEC complaint raised various allegations, including insider trading, related to certain high yield bond funds that were managed by Heartland Advisors in years prior to 2002. On August 31, 2006, the court granted our motion for summary judgment on the Insider Trading claims against Nasgovitz in this matter in an opinion written by Judge C. N. Clevert.
Derivatives Matters
Winston & Strawn regularly assists clients with structuring, negotiating, and documenting a broad array of over-the-counter derivative products and litigating the controversies that can arise in connection with derivative transactions.
Smith v. Arthur Andersen LLP, et al.
General Electric Capital Corporation
We won summary judgment on behalf of our client as a third-party defendant in Smith v. Arthur Andersen et al., a lawsuit filed in the District of Arizona that arose from the bankruptcy of Boston Chicken.
In re Bank One Securities Litigation - First Chicago Shareholder Claims
On March 16, 2006, the Northern District of Illinois approved a favorable settlement achieved by Winston & Strawn behalf of JP Morgan Chase & Co. in a shareholder class action lawsuit against the former Bank One Corporation and certain former officers and directors. The case arose out of the June 1998 merger of Banc One Corporation and First Commerce Corporation. The plaintiff class was seeking more than $1 billion in damages, and the matter ultimately settled for $39 million.
ULLICO Stock Investigation
Ullico, Inc.
Winston & Strawn and Governor James Thompson served as special counsel to ULLICO, a Washington, D.C.-based union-owned insurance company, to conduct an internal investigations into possible insider trading and fiduciary duty violations related to certain ULLICO stock transactions that occurred under its former management. Our attorneys prepared the 138-page confidential "Thompson Report," which was issued to the ULLICO directors and officers and their counsel. ULLICO’s board voted to publicly disclose the report, and Governor Thompson testified before a U.S. Senate panel investigating the matter. After the report was publicly released, ULLICO elected a new board and management team and adopted the corporate governance reforms recommended by
Morningstar Internal Investigation
Morningstar, Inc.
Winston & Strawn represented Morningstar in a year-long Securities and Exchange Commission investigation related to incorrect data that Morningstar published with respect to a mutual fund that overstated the fund’s returns.
Frank P. Slattery, Jr., et al. v. United States (No. 93-280C)
Slattery, Jr. Frank P.
Winston & Strawn attorneys obtained a $371 million judgment in the Court of Federal Claims on behalf of the shareholders of Meritor Savings Bank in Slattery et al v. United States.
HSH Nordbank Joint Venture with Bank of America
HSH Nordbank AG
Winston & Strawn represented HSH Nordbank AG in connection with its acquisition of a partnership interest with Bank of America, N.A.
In re Luxottica Group S.p.A. Securities Litigation
Luxottica
Winston & Strawn represented Luxottica Group S.p.A. and its chairman in a securities class action involving our client’s 2001 acquisition of Sunglass Hut International, Inc. (SHI). The suit alleged that Luxottica violated § 14(d)(7) of the Securities Exchange Act of 1934 and the “Best Price Rule” by entering into a consulting and non-compete agreement with SHI’s chairman shortly before Luxottica commenced a tender offer for SHI’s outstanding common stock. After extensive discovery and our submission of a multi-pronged summary judgment motion, the matter settled very favorably for our client.
Antares Capital Sale to General Electric Capital Corporation
Antares Capital Corporation
Winston & Strawn represented Antares Capital Corporation and its management equityholders in connection with its sale to General Electric Capital Corporation.
BlueCross v. American Express
American Express Company
American Express retained Winston & Strawn to represent it in a breach of settlement agreement case in which BlueCross sought specific performance and an injunction prohibiting American Express from using the mark "BlueCash" on credit cards. After trial, the court dismissed BlueCross' claims and denied its request for injunctive relief.
Payler v. HSH Nordbank AG
HSH Nordbank AG
HSH Nordbank retained the firm to defend it against a trademark infringement action brought by the owner of a U.S. registration for the mark HSH for financial publications. The plaintiff sought an injunction barring all use of the HSH Nordbank name in the United States. The matter was settled favorably to our client, which obtained complete freedom to operate under the HSH Nordbank name.
Wells Fargo Bank Minnesota v. Wachovia Bank, National Association
Wachovia Bank
Winston & Strawn attorneys defended Wachovia Bank in the two-week bench trial of a lawsuit brought in the Northern District of Texas by ORIX Capital Markets and Wells Fargo Bank Minnesota in connection with the document delivery protocols for a $3 billion commercial mortgage securitization trust. ORIX, the special servicer to the trust, contended that the failure of Wachovia to maintain and deliver loan origination documents that it had destroyed impaired the value of the trust and resulted in increased loan losses. In May 2005, the judge ruled that ORIX had failed to prove any damages.
Discover Financial $311 Million Acquisition of PULSE EFT Association
Discover Financial Services
Winston & Strawn represented Discover Financial Services, Inc. in its $311 million acquisition of PULSE EFT Association. The transaction combines PULSE and its 4,100 member banks, credit unions, and savings institutions with the Discover Network and its 4 million merchant and cash access locations to create a new competitor in the electronic payments field.
Aon Securities Litigation
AON Corporation
Winston & Strawn represented Aon Corporation in a securities fraud class action involving claims in connection with the alleged restatement of Aon’s net income for a three-year period. The lawsuit was a consolidation of numerous separate securities fraud class actions that were filed against our client in late 2002. After our attorneys filed a motion to dismiss the case in its entirety, which triggered the PSLRA’s automatic stay provisions relating to discovery, the parties agreed on a settlement which subsequently was approved by the court.
CIB Marine Bancshares, Inc. internal investigation
CIB Marine Bancshares Board of Directors
Winston was presented with a challenging assignment by the board of directors of CIB Marine Bancshares, Inc., a multibank holding company engaged in a financial turnaround. The board recently replaced top management and then hired our firm to conduct an internal investigation regarding lending and loan management issues at CIB Marine and its subsidiaries. The Winston investigation team interviewed dozens of individuals, reviewed numerous loan transactions, and ultimately presented its findings to the board of directors and federal and state banking regulators.
Comdisco bankruptcy litigation
JPMorgan Chase Bank, N.A.
On behalf of JPMorgan Chase Bank, N.A., we obtained the allowance of a $123 million claim as part of the bankruptcy of Comdisco, Inc., which had objected to our client's claim.
Reorganized Farmer's Cooperative Association, FCA Post-Confirmation Trust v. CoBank
CoBank, ACB (Legal Division)
Winston & Strawn attorneys won summary judgment on behalf of CoBank in a lender liability matter before the District of Kansas that arose from the collapse of the Farmers Cooperative Association of Lawrence, Kansas.
Morgan Keegan NASD Arbitration
Morgan, Keegan & Company, Inc.
Our attorneys defended Morgan Keegan, a national brokerage firm, in a week-long NASD arbitration in Louisville, Kentucky. The claimant was a former client who had been convicted of insider trading by the U.S. attorney for the Southern District of New York.
Sanders Confectionery v. Heller Financial
Heller Financial, Inc.
We represented Heller in the Eastern District of Michigan in connection with a lender liability claim for approximately $150 million raising various causes of action, including fraud, RICO, and various securities violations.
Heller Financial, Inc. v. Freehold, et. al.
Heller Financial, Inc.
We represented Heller Financial in a breach of contract action relating to a failed co-generation project in New Jersey. Heller Financial provided developmental financing on the project, but refused to proceed with a request for permanent subordinated financing due to material adverse changes to the project. The owners of the project received a cash settlement from the utility. Heller filed claims for payments of $56 million due under the financing agreements and Freehold counterclaimed for $75 million in damages. After extensive discovery, injunction proceedings, and several months of trial hearings, the case was settled on favorable terms by the parties.
Isquith v. Caremark International, Inc.
Caremark RX Inc.
We represented Caremark in this suit filed by a Caremark shareholder against Caremark, its former corporate parent, and others.
In re Caremark International Inc. Derivatives Litigation
Caremark RX Inc.
We represented Caremark in this action in Delaware Chancery Court which culminated in a significant decision on the scope of the duty of care. Specifically, the Court recognized the duty of a director to use good faith efforts to assure that an adequate corporate reporting system existed to monitor compliance by the corporation with applicable laws and a defense to breach fiduciary claims where such compliance systems are used by a corporation.
In re Caremark International Inc. Securities Litigation
Caremark RX Inc.
Winston & Strawn represented Caremark International Inc. in three consolidated securities fraud class actions which were filed in federal court in Illinois.
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