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Shareholder and Securities

Susman Godfrey established its roots in securities litigation. The firm's decades-long experience in securities litigation includes handling dozens of shareholder class actions and derivative suits. Susman Godfrey attorneys have been on the forefront of legal issues in securities litigation from the early case of Paul F. Newton & Co. v. Pressman, Frohlich & Frost, 630 F.2d 1111 (5th Cir. 1980), which established the validity of the respondeat superior doctrine in securities cases, to Rubinstein v. Collins, 20 F.3d 160 (5th Cir. 1994), which affirmed the viability of the 10(b) cause of action.

As a result of this experience and its history in complex litigation, Susman Godfrey ranks among the country's preeminent firms for managing and trying complex securities cases.

Susman Godfrey has handled several securities cases that resulted in substantial judgments for the plaintiff:

  • In January 2002, a $75 million settlement became final in the Alcatel securities litigation. Susman Godfrey and its co-lead counsel negotiated the settlement by on behalf of the class of Alcatel shareholders. Susman Godfrey and its co-counsel aggressively pursued the case through the settlement negotiations in October 2001, shortly before the November 2001 trial setting.
  • In January 2001, a federal court in Las Vegas, Nevada, granted final approval to settle a securities class action. The case involved allegations that Equinox International Corporation and its affiliates functioned as an illegal pyramid scheme. It settled after three weeks of trial. The settlement also imposes on defendants a permanent ban on operating any multi-level marketing company, rescission of all distributorship agreements with past and current Equinox distributors, and pro rata restitution to the class members of the funds they paid to Equinox.
  • In November 1994, a jury in federal court in New York City awarded Susman Godfrey client, investment banker Frank A. Benevento II, $14.2 million in damages against RJR Nabisco, Inc. The case involved a fee dispute arising from the largest corporate takeover in history, the 1988 leveraged buyout of RJR Nabisco that was the subject of the book and movie "Barbarians at the Gate."
  • In 1992, the Delaware Supreme Court affirmed a $38 million award for 20,000 former shareholders of Shell Oil Company in a class action. As lead counsel, Susman Godfrey tried the case in Delaware Chancery Court, which found that Shell's parent company breached a fiduciary duty in connection with the disclosure materials sent to the class as part of a cash-out merger. In 1992, the Delaware Supreme Court also upheld a $122 million award for former owners of Shell stock in an action seeking the fair appraisal value of their shares.

The firm has also obtained many pretrial settlements in excess of seven figures, including these selected cases:

  • Medical Care America, Inc. securities litigation.
  • Houston Oil Trust securities litigation.
  • First Republic securities litigation.
  • General Electric securities litigation
  • Tenneco securities litigation.

Although the cases mentioned above highlight only the plaintiff's side, the firm has also successfully defended many securities cases.