In the last seven months, lawyers from a handful of shareholder firms have filed more than 60 lawsuits in New York State Supreme Court in Manhattan against board members of special purpose acquisition companies, accusing SPAC directors of breaching their duty to investors by omitting important information from public filings about their proposed acquisitions.
The cases are not being litigated beyond initial pleadings, based on a review of the dockets. Instead, according to three big-firm lawyers who have represented SPAC defendants hit with breach-of-duty complaints, the suits are typically resolved with supplemental disclosures by the SPAC – and the payment of so-called mootness fees to plaintiffs lawyers.
‘Enforcement 40’ for 2020
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