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John Farley, a partner in Goodwin Procter's Securities Litigation & SEC Enforcement and White Collar Crime & Government Investigations Practices, represents issuers, individuals and institutional investors in a wide range of matters, including shareholder and derivative class action lawsuits, M&A litigation, post-closing disputes and complex commercial litigation. His clients represent a wide range of industries, from financial services to medical devices and healthcare.

Mr. Farley also advises corporate and individual clients in connection with internal investigations and investigations by the SEC, the Department of Justice and state agencies into alleged insider trading, market timing, stock option practices and accounting irregularities, purported securities violations and other matters.[[Read More Delimiter]]

In addition, Mr. Farley has experience in a range of general commercial matters, including fraud, breach of contract and civil RICO claims, as well as in negotiating substantial business agreements on behalf of clients, participating in internal investigations and advising clients on disclosure, corporate governance and other matters.

Current and recent representations include:

  • Portfolio company of a large healthcare-related private equity fund in connection with a post-closing dispute challenging approximately 80% of deal value. Claim alleges pervasive violations of Medicare regulations as well as ERISA and accounting fraud.
  • Part of Goodwin team that represented individual defendant at trial for alleged insider trading scheme.
  • Successfully argued motion to dismiss shareholder suit challenging acquisition of Maryland-organized publicly traded REIT; landmark published opinion sets the pleading standard for suits challenging acquisitions of Maryland companies.
  • Major private equity fund in connection with unlawful competition by founder of portfolio company in mobile technology space; succeeded in permanently shutting down illegal competitor.
  • A major payment card processor in connection with securities fraud and derivative class actions filed on behalf of stockholders after the issuer disclosed a security breach resulting in the loss of several hundred thousand payment card numbers and its share price fell approximately 80% thereafter. Court dismissed securities fraud class action with prejudice in response to client’s arguments; derivative suits were voluntarily dismissed with prejudice in exchange for agreement not to seek fees and costs.
  • What was America’s largest home mortgage lender, in connection with the largest securities fraud class action in U.S. history, alleging fraud in connection with the sale of more than $350 billion of mortgage-backed securities.
  • Nine former directors and officers of Lyondell-Basell Industries, a $21 billion petrochemical concern that filed for bankruptcy protection shortly after completing a leveraged buyout. Claims against eight of nine clients were dismissed from bankruptcy adversary proceeding; motion to dismiss claims against the remaining defendant is pending.

Other Representative Matters

Securities Fraud. In addition to the mortgage-backed securities and card processor actions above, represented a home mortgage lender in connection with nationwide stock-drop class action and class action by buyers of convertible debt securities (class certification denied based in part on novel theory of market efficiency advanced by our client), as well as numerous "opt-out" matters. Successfully represented investors in fraudulently mispriced convertible bond arbitrage fund before NASD panel.

Internal and Government Investigations. Numerous internal and government investigations into allegations of, for example, insider trading, stock option backdating, manipulation of a multi-billion dollar securities lending program, and a wide array of accounting issues (including foreign exchange hedging, inventory management and revenue recognition across numerous industries, from software to heavy industrial machinery and medical devices).

M&A Litigation. In addition to the Maryland REIT matter discussed above, representation of other REITs in responding to M&A strike suits by shareholders challenging corporate acquisitions, including most recently the successful defense of a $7.1 billion public REIT acquisition. Beyond REITs, successful representation of buyers and sellers in an array of industries, including technology, medical devices and electrical power generation.

Post-Closing Disputes. Broad experience in post-closing disputes, representing buyers and sellers in industries ranging from healthcare to mobile technology to fast-food restaurant chains.

Prior to joining Goodwin Procter, Mr. Farley was a litigation associate at Cravath, Swaine & Moore LLP in New York City.

Mr. Farley is a member of the American Bar Association and the Association of the Bar of the City of New York.

The Pendulum Swings Back
White Collar Crime
May 1, 2006