Monday, July 23, 2012

Gene Stearns wins Bank Atlantic case in 11th Circuit

Here's the 11th Circuit opinion, affirming Judge Ungaro's decision to toss the jury verdict (prior coverage here).

Big win for Stearns Weaver-- Gene Stearns, Adam Schachter, Cecilia Simmons, Grey Mead, and Andrea Nathan.

From Judge Tjoflat's conclusion:

As Bancorp acknowledged in several public SEC filings during the class period, BankAtlantic’s assets were concentrated in loans tied to Florida real estate. As a result, BankAtlantic and Bancorp were particularly susceptible to any deterioration in the Florida real estate market, in addition to any national developments. To support a finding that Bancorp’s misstatements were a substantial factor in bringing about its  losses,therefore, State-Boston had to present evidence that would give a jury some indication, however rough, of how much of the decline in Bancorp’s stock price resulted not from the fraud but from the general downturn in the Florida real estate
market—the risk of which Bancorp is not alleged to have concealed. ... None of its evidence excluded the possibility that class members’ losses resulted not from anything specific about BankAtlantic’s commercial real estate portfolio that Bancorp hid from the public, but from market forces that it had warned of—and that would likely have caused significant losses for an investor in any bank with a significant credit portfolio in commercial real estate in Florida in 2007. Bancorp is therefore entitled to judgment as a matter of law.


Anonymous said...

Court sides with bank. Shocking.

Anonymous said...

That is a mystifying opinion. Tjoflat cites to evidence not even in the record that Florida's real estate market was soft in 2007 (and that was before the crash by the way), therefore the fund was destined to collapse, so it was OK to lie to investors for a few months when the bank knew the fund was in trouble. Unbelieveable.