Legal

Robbins Geller booted from leading securities case for 'misleading' brief

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A gavel and a block is pictured at the George Glazer Gallery antique store in this illustration picture taken in Manhattan, New York City, U.S., August 18, 2020. REUTERS/Andrew Kelly/Illustration/File Photo

  • Robbins Geller disqualified from leading class action for what judge called omissions in brief
  • Investor lawsuit against Grupo Televisa over bribery continues

(Reuters) - A Manhattan federal judge has tossed Robbins Geller Rudman & Dowd off a class action against Grupo Televisa SAB three years after it was appointed to represent investors in the case, saying the law firm had sought the role with a "misleading" brief.

U.S. District Court Judge Louis Stanton said on Wednesday that the firm can no longer represent a class of American Depositary Receipt holders alleging the Mexico-based media company concealed a scheme to bribe soccer officials to win broadcasting rights to four World Cup tournaments.

The company has said the lawsuit is meritless and denied bribing Federation Internationale de Football Association (FIFA) officials.

In disqualifying Robbins Geller from the lawsuit, Stanton wrote the firm had failed to mention its former pension fund client made more money through investments in a fund that shorted Grupo Televisa than it had lost on the ADRs.

Omitting that fact from a brief calling the pension fund a typical investor made the firm's bid for the "lucrative" lead counsel role misleading, Stanton said.

"In the world of securities law, that is a definition of fraud," he wrote.

Darren Robbins of Robbins Geller said on Wednesday that Stanton's interpretation of what transactions institutional investors must disclose in the lead plaintiff process was "unprecedented" and that the firm will appeal.

Herbert Wachtell of Wachtell, Lipton, Rosen & Katz, who represents the company, did not immediately respond to a request for comment on Wednesday.

The Televisa shareholder case was brought on behalf of investors who lost money on the company's ADRs between April 2013 and January 2018.

Investors alleged Televisa's statements about its internal controls misled them about its ability to prevent bribery. As the truth about its efforts to win rights to the 2018, 2022, 2026 and 2030 World Cups came out, the ADR price fell, the lawsuit said.

Stanton disqualified Robbins Geller's former client, the Colleges of Applied Arts and Technology Pension Plan, in June after Grupo Televisa flagged the pension fund's investment in an Arrowstreet Capital LP fund that had shorted Televisa ADRs.

The judge, however, kept Robbins Geller on the case and named another fund as class representative, while certifying the class. In April, Grupo Televisa moved to disqualify the law firm in a sealed motion.

Stanton granted the motion on Monday, saying Robbins Geller's "willingness to submit so misleading a brief, in order to obtain a result for its client which it predictably might not obtain if all relevant facts were addressed, disqualifies it from continuing as counsel."

The case is In re Grupo Televisa Securities Litigation, U.S. District Court, Southern District of New York, No. 18-01979.

For the former lead plaintiff: Darren Robbins and Rachel Jensen of Robbins Geller Rudman & Dowd

For Grupo Televisa: Herbert Wachtell and Tamara Livshiz of Wachtell, Lipton, Rosen & Katz

Read more:

Robbins Geller reappointed to lead Grupo Televisa case after client DQed

2nd Circuit won't hear Grupo Televisa appeal over last-minute lead plaintiff swap

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