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2023 Securities Group Of The Year: Cohen Milstein


February 27, 2024

Cohen Milstein Sellers & Toll PLLC’s securities team made headlines last year by securing one of the largest securities class actions recoveries of all time for Wells Fargo investors and by introducing major corporate governance reforms at several financial institutions after their alleged attempts to obstruct the stock loan market, earning the firm a spot among Law360’s 2023 Securities Groups of the Year.

The $1 billion settlement — the sixth-largest securities settlement of the last decade — between Wells Fargo and its investors was finalized in September, and Cohen Milstein served as co-lead counsel for the plaintiffs. The suit alleged the bank and its top executives made false and misleading statements about their compliance with consent orders put in place after the bank was found in 2016 to have engaged in widespread consumer abuses, including opening millions of unauthorized customer accounts.

The deal is the largest security settlement to not involve a financial restatement by the institution or enforcement actions by the U.S. Securities and Exchange Commission or the U.S. Department of Justice. Steven J. Toll, co-chair of Cohen Milstein’s securities practice, said that makes the recovery especially significant, since accounting corrections and legal action from the government are typically the hallmark of securities cases.

“We didn’t have those factors that make cases easier to win, so that heightens the value of what we were able to achieve here,” Toll said. “It was all through our own work and research and analysis of all the issues that was able to get us such a large number.”

Wells Fargo shareholders said they incurred significant losses in March 2020 when reports from the U.S. House Committee on Financial Services and subsequent congressional hearings revealed that Wells Fargo had “clearly demonstrated an unwillingness and inability to stop harming its customers” and that its remediation plans fell “woefully short” of regulators’ expectations.

Wells Fargo argued investors could not prove that statements about progress toward overhauling its risk management policies were false or made to intentionally mislead investors.

Toll said the timing of the alleged stock declines, which occurred around the time COVID-19 was declared a global pandemic, was another hurdle in the suit.

“It was a very unusual challenge to confront, and they kept arguing why the damages and thus the recovery and settlement should be much lower, but we were able to still get a very substantial settlement,” he said.

Cohen Milstein helped investors secure another big payout last year in an anti-competitive class action against defendants Morgan Stanley, Goldman Sachs, UBS, JP Morgan and EquiLend. Including a previous $81 million settlement with Credit Suisse, the court has preliminarily approved more than $580 million in cash payments.

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Many of Cohen Milstein’s cases, including the Boeing suit, the Wells Fargo suit and the antitrust financial suit, are led by institutional investors. Julie Reiser, also Cohen Milstein’s securities practice co-chair, said one of the most rewarding parts of her job is knowing people will have the financial security to retire when large settlements are paid out.

“Working with pension funds to collect money and to make sure they’re made whole when there’s fraud is really motivating for me and my colleagues, and that helps make our practice stronger,” Reiser said.

Read 2023 Securities Group Of The Year: Cohen Milstein.