Richard C. St. John

Financial Services – Litigation and Investigations

Rick advises financial institutions – banks, broker dealers, private equity firms and others – on a full range of disputes and internal investigations. His work in this area includes securities cases, indemnity disputes between financial institutions and complex litigation arising out of Ponzi schemes and other third-party frauds.

Bank of America as both a victim of the wide-ranging Ponzi scheme perpetrated by Taylor, Bean & Whitacker (TBW) and as a target of third-party litigation brought by major financial institutions trying to recover some $1.75 billion in losses from our client based on it having served as trustee, custodian and collateral agent for TBW’s commercial paper facility. As a matter of first impression, we established the principle under New York law that Bank of America, in one representative capacity, could not be required to sue itself in another representative capacity.

Bank of America as both plaintiff and defendant in some of its most significant litigation arising from the mortgage crisis – including litigation with RMBS investors, trustees and monoline insurers. Ongoing activity includes a major indemnification case pending in New York Supreme Court.

E*TRADE Securities in a crisis arising from the meltdown of MJK Clearing—the largest failure of a Securities Investor Protection Corp.-insured institution to that date. Originally retained to defend E*TRADE against contractual claims arising from multi-broker securities lending transactions, Rick and his colleagues took discovery around the world and filed suit against two large foreign banks. Munger Tolles ultimately achieved a series of pre-trial motion victories for E*TRADE and substantial recoveries from the institutional and other defendants.

Huntington Bancshares Incorporated and certain of its officers and directors in a shareholder case under the Securities Act of 1933 focusing on the decline in stock prices that this and other regional banks suffered when Silicon Valley Bank failed. The complaint alleged that the Company’s registration statement failed to disclose the extent of the Company’s exposure to interest rate risk. The case was dismissed with prejudice following a single round of motion practice, with the court holding that, “HBI’s Offering Materials fully complied with [the] Securities Act of 1933.”

Oaktree Capital Management in a dispute with a fund manager who resigned abruptly to launch his own private equity firm. Rick and his team defeated the manager’s claims for additional incentive compensation and demonstrated pre-departure misconduct on the part of the manager, following which Oaktree was awarded compensatory damages and fees totaling more than $20 million.

Flourish Ventures, Accion International and Bamboo Capital Partners in a dispute with the co-founder of a portfolio company, challenging the terms on which he separated with the portfolio company and asserting rights with respect to a board position he continued to hold with the portfolio company. Successfully enforced arbitration and forum-selection provisions and obtained dismissal of claims brought against clients in Delaware Chancery Court.