A&O Shearman

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.
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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.
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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.
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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.
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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.
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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.
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Antitrust Litigation

Florida Judge Grants Motion to Dismiss Section 2 Monopolization Claim

On June 16, 2026, the United States District Court for the Southern District of Florida, Judge Roy K. Altman, granted in full a motion to dismiss a Miami-based boat brokerage’s monopolization allegations against the operator of the three largest online platforms that connect buyers and sellers of recreational boats in the United States. Plaintiff alleged that Defendant had unlawfully acquired, maintained, and expanded monopoly power in violation of Section 2 of the Sherman Act, the Florida Antitrust Act, and the Florida Deceptive and Unfair Trade Practices Act, seeking treble damages, injunctive relief, attorneys’ fees. The Court dismissed the two federal Section 2 counts without prejudice and declined to exercise supplemental jurisdiction over the three state-law counts. Plaintiff has until June 30, 2026, to file an amended complaint.
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Yacht Brokers Face Antitrust Claims: Denied Motion To Compel Arbitration

On June 10, 2026, the United States Court of Appeals for the Eleventh Circuit affirmed the United States District Court for the Southern District of Florida’s denial of defendant, YATCO, LLC’s, motion to compel arbitration. The interlocutory appeal arose from a putative class action alleging a conspiracy to fix and inflate commissions in the used yacht resale market. Ya Mon Expeditions, LLC, et al. v. YATCO, LLC, No. 25-10140 (11th Cir. 2026).
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Intellectual Property Litigation

Federal Circuit Holds Pleading‑Level Knowledge Triggers DTSA Statute Of Limitations

On May 28, 2026, the United States Court of Appeals for the Federal Circuit reversed a judgment for plaintiff on trade secret misappropriation claims under the Defend Trade Secrets Act (“DTSA”) holding that plaintiff’s claims were untimely because the statute of limitations had expired before the lawsuit was filed. Insulet Corp. v. EOFlow, Co., No. 2025-1807, 2026 WL 1502238 (Fed. Cir. May 28, 2026).
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Federal Circuit Offers Guidance On The “Skilled Searcher” Inquiry Required Under 35 U.S.C. § 315(e)(2)

On June 18, 2026, the Court of Appeals for the Federal Circuit (“CAFC”) issued a precedential opinion reversing and remanding a partial summary judgment from the United States District Court for the Western District of Washington finding that appellant-defendant was estopped under 35 U.S.C. § 315(e)(2) from asserting two invalidity grounds. Ironburg Inventions LTD. v. Valve Corp., __ F.3d __ (Fed. Cir. June 18, 2026). In reaching its decision, the CAFC concluded that the district court relied on insufficient evidence to estop one ground, and failed to adequately account for hindsight bias in estopping the other ground.
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