Our firm is one of six members of an Executive Committee appointed by a federal district court judge in New York to handle multi-district class action claims arising out of the October 31, 2011 collapse of the commodities trading firm, MF Global, Inc. MF Global was, prior to its collapse in 2011, one of the largest commodities futures brokers in the world, with over 26,000 domestic and international commodity trading customers trading tens of billions in assets. When the firm collapsed, there was a shortfall of approximately $1.6 billion in customer funds, which the firm was required to hold in segregated accounts for the exclusive benefit of its customers. After several years of litigation, we were able to secure a complete recovery of the missing funds for the firm’s customers through an agreement with the company’s court-appointed trustee. We continue to pursue claims on behalf of the customers and the trustee against the former officers and directors of the firm, including former senator and governor of New Jersey, Jon S. Corzine. Corzine was the company’s CEO, and largely responsible for implementing changes in the company’s business model that lead to its demise.
Recently, Corzine and other ex-directors and officers agreed to pay $64.5 million to settle a separate lawsuit brought on behalf of the shareholders and bondholders of MF Global’s parent company, MF Global Holdings Ltd, formerly a publicly traded company. The settlement ends the suits by the investors against the directors and officers. The investors had alleged that Corzine and other executives made false statements in company securities filings about MF Global’s controls and liquidity. They claimed when the true facts were disclosed, the price of MF Global’s securities declined precipitously.
Whether you are an investor in a large publicly-traded company like MF Global Holdings, or a small closely held or family-owned business, you have rights that you need to protect. If things do not seem right with the business you invested or have an ownership interest in, your instincts are probably correct. You should take a proactive role and investigate the circumstances. All shareholders, partners, and LLC members have the legal right to review a company’s books and records. If you are uncomfortable reviewing those records, we can help. Just don’t sleep on your rights. There are strict statutes of limitations that impact when a shareholder or other investors may bring suits to recover for wrongdoing. Be on your toes. Don’t be afraid to act when you think something may be wrong.