Welcome to A&O Shearman's Need-To-Know Litigation Weekly, which analyzes notable U.S. decisions, orders and developments each week in areas of Securities Litigation, Government/Regulatory Enforcement, M&A and Corporate Governance, Antitrust Litigation and IP Litigation. This weekly newsletter is intended to supplement our various publications and thought leadership concerning these important substantive areas.
Securities Litigation
First Circuit Partially Revives Putative Class Action Against Consumer Robotics Company
On June 5, 2026, the United States Court of Appeals for the First Circuit reversed in part a decision from the United States District Court for the District of Massachusetts dismissing a putative securities fraud class action against a consumer robotics company (the “Company”) and certain former and current executives (the “Individual Defendants”), alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Premca Extra Income Fund LP v. Angle, et al., No. 25-1192 (1st Cir. June 5, 2026). Plaintiff alleged that from February 13, 2023, through January 29, 2024, defendants made numerous misleading statements and omissions regarding the status of the Company’s intended merger with another company. In reversing in part, the First Circuit held that the district court correctly dismissed the amended complaint with respect to all alleged misstatements or omissions except for one—which the Court held was actionable and supported an inference of scienter.Read More
District of Massachusetts Dismisses Class Action Against Gene Editing Company
On June 18, 2026, Judge Denise J. Casper of the United States District Court for the District of Massachusetts dismissed a putative class action asserting claims against a clinical-stage gene editing company (“Company”) and several of its officers (collectively, “Defendants”) under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5. Plaintiffs alleged that Defendants misrepresented the development of, and timeline for, the Company’s gene-insertion therapy for Alpha-1 Antitrypsin Deficiency (“AATD”)-associated lung disease, including by omitting to disclose that underlying preclinical studies allegedly failed before the program was discontinued. Although the Court found one category of statements actionable, it held that Plaintiffs failed to plead facts giving rise to a strong inference of scienter or loss causation and dismissed the complaint with prejudice.Read More
Government/Regulatory Enforcement
House Committee On Oversight And Government Reform Opens Prediction Markets Insider Trading Probe
On May 22, 2026, House Committee on Oversight and Government Reform (“Committee”) Chairman James Comer opened an investigation into how users of prediction market platforms potentially are using nonpublic information to engage in insider trading. Chairman Comer has requested documents and information to assess how the platforms verify the identities of domestic and foreign account holders, enforce geographic restrictions, and monitor suspicious trading activity to guard against insider trading.Read More
DOJ And CFTC Charge U.S. Soldier For Insider Trading In Prediction Markets
On April 23, 2026, the U.S. Department of Justice (“DOJ”) and Commodity Futures Trading Commission (“CFTC”) announced separate enforcement actions against an active-duty member of the U.S. Army, alleging that the soldier utilized non-public information regarding classified U.S. operations related to the capture of Venezuelan President Nicolás Maduro to trade on Polymarket.com, a prediction market website.Read More
M&A and Corporate Governance
Delaware Court Of Chancery Applies Section 144 Heightened Independence Presumption To Demand Futility
On June 15, 2026, Vice Chancellor Lori W. Will of the Delaware Court of Chancery granted in part and denied in part a motion to dismiss claims of breach of fiduciary duty and unjust enrichment in a stockholder derivative action challenging two board compensation decisions by a financial institution (the “Company”): a one-time $50 million equity grant to its founder and non-executive chairman, and the directors’ self-awarded compensation. Ayers v. Foley, No. 2025-0650-LWW, 2026 WL 1723538 (Del. Ch. June 15, 2026). Applying the recently amended 8 Del. C. § 144(d)(2), the Court dismissed the claims tied to the equity grant but sustained the claims arising out of director compensation.Read More
Delaware Court Of Chancery Enforces California Forum Selection Clause In Employment Agreement With Stockholder, Notwithstanding Delaware Exclusive-Forum Bylaw
On April 21, 2026, Vice Chancellor Nathan A. Cook of the Delaware Court of Chancery granted a motion to dismiss breach of fiduciary duty claims asserted by Masimo Corp. (the “Company”) against its former CEO and board chairman, enforcing a California forum selection clause in defendant’s employment agreement. Masimo Corp. v. Kiani, No. 2024-1086-NAC (Del. Ch. Apr. 21, 2026). In so holding, the Court concluded that Section 122(18) of the Delaware General Corporation Law (“DGCL”)—adopted in 2024 following West Palm Beach Firefighters' Pension Fund v. Moelis & Co., 311 A.3d 809 (Del. Ch. 2024)—permitted corporations to agree to non-Delaware forum selection provisions in stockholder agreements, even if those provisions would require the adjudication of fiduciary duty claims in a non-Delaware forum.Read More
Antitrust Litigation
Fourth Circuit Vacates Preliminary Injunction Allowing College Football Players To Bypass NCAA Eligibility Rules
On April 3, 2026, Senior Judge Henry Floyd of the United States Court of Appeals for the Fourth Circuit, joined by Judges Harris and Benjamin, vacated a preliminary injunction issued by the United States District Court for the Northern District of West Virginia that had allowed four college football players to participate in the 2025–26 collegiate football season in contravention of the NCAA’s 5-year eligibility limitation, finding that the district court committed legal errors in its assessment of the players’ likelihood of success on the merits of their Sherman Act Section 1 claim challenging the NCAA’s eligibility rule. Robinson v. NCAA, No. 25-2003 (4th Cir. Apr. 3, 2026).Read More
Second Circuit Affirms Defunct Soccer League’s Antitrust Loss, Denies New Trial
On May 19, 2026, the U.S. Court of Appeals for the Second Circuit denied the now-defunct North American Soccer League’s bid for a new trial after a jury rejected its claims, concluding that plaintiff failed to prove a relevant antitrust market affected by the alleged conduct of defendants. North American Soccer League LLC v. U.S. Soccer Federation Inc., case number 25-1225. The Second Circuit affirmed the lower court’s judgment for Major League Soccer and the United States Soccer Federation. Plaintiff had accused the country’s premier soccer league and the sport’s governing body of rigging the league-sanctioning system to exclude it from the top tiers of U.S. men’s professional soccer. The U.S. District Court for the Eastern District of New York denied plaintiff’s request for a new trial, and the appellate court affirmed both the denial of a new trial and an earlier decision partially granting defendants summary judgment on the grounds that league participation rules were not per se unlawful and, thus, required proof of a relevant market and competitive harm in that market.Read More
Intellectual Property Litigation
USPTO Director Sends PTAB Unpatentability Decision To Rehearing Panel In Light Of Contrary Jury Verdict
In response to a request for a Director Review of a PTAB decision finding claims 1-4 and 6 of U.S. Patent No. 7,594,168 unpatentable, the Director of the United States Patent and Trademark Office (“USPTO”), on May 1, 2026, referred this review to a Delegated Rehearing Panel (“DRP”). The DRP is to determine whether petitioners had presented “meaningfully different evidence and arguments” to the PTAB compared to what had been presented to the jury in a district court action that reached a finding that patent had not been proven invalid. Facebook, Inc. v. Express Mobile, Inc., IPR2021-01226, Paper 65 (May 1, 2026). In referring this review, the Director of the USPTO stated that the PTAB panel “effectively disregard[ed]” the September 16, 2025 Memorandum re prior findings of fact and conclusions of law. IPR 2021-01226, Paper 65 at 4. The Memorandum requires the Board to explain why a different outcome is warranted when it reaches a finding or conclusion different from a prior adjudication, with a more detailed explanation required when the same or substantially the same evidence or arguments were presented.Read More
Federal Circuit Affirms No Infringement in Pharmaceutical Patent Dispute Over pH Measurement Conditions For Epoprostenol Composition
On May 13, 2026, the U.S. Court of Appeals for the Federal Circuit (Judges Reyna, Taranto, and Stoll) affirmed a decision of the U.S. District Court for the Northern District of West Virginia finding that defendant does not infringe U.S. Patent Nos. 8,318,802 and 8,598,227 (collectively, the “’802” and “’227” patents), either literally or under the doctrine of equivalents. Actelion Pharmaceuticals Ltd v. Mylan Pharmaceuticals Inc., No. 2024-1641 (Fed. Cir. May 13, 2026). The decision addresses how pH measurements recited in pharmaceutical patent claims should be interpreted, and the application of prosecution history estoppel and the disclosure-dedication rule to bar equivalents-based infringement theories.Read More