March 17, 2023
A New York federal judge certified one of three proposed investor classes in a suit alleging Credit Suisse tricked investors into buying a series of short-term notes inversely tied to stock market volatility in 2018, finding two of the proposed classes can’t be certified because they conflict with one another.
U.S. District Judge Analisa Torres issued an order on Thursday granting certification to the investors’ proposed Securities Act class, which includes all individuals and entities that purchased or acquired Inverse VIX exchange-traded notes, also known as XIV notes, pursuant or traceable to the bank’s offering documents, and were subsequently damaged.
The judge denied certification to proposed classes identified as the misrepresentation and manipulation classes. The manipulation class would have included all individuals and entities that purchased or acquired XIV notes between Jan. 29 and Feb. 5, 2018, and the manipulation class was proposed to include those who sold or redeemed the notes on or after Feb. 5, 2018.
Judge Torres said in her order that the Securities Act class satisfies all the requirements of Rule 23(a), such as numerosity, typicality and commonality, to warrant certification, and she rejected Credit Suisse’s argument that the plaintiffs “suffer from various infirmities” that preclude them from serving as class representatives.
The four plaintiffs, Set Capital LLC, Apollo Asset Ltd., Aleksandr Gamburg and Stefan Jager, intended to represent all three classes.
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In addition to ruling on certification in her order, Judge Torres approved Cohen Milstein Sellers & Toll PLLC and Levi & Korsinsky LLP as class counsel.
“Plaintiffs’ counsel diligently investigated the claims in this case, drafted a detailed complaint, survived a motion to dismiss on appeal, and have further investigated the claims in discovery. Plaintiffs’ counsel also has extensive experience in class action litigation, including securities class actions,” she said.
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The investors are represented by Michael B. Eisenkraft, Laura H. Posner, Steven J. Toll, Brendan Schneiderman and Carol V. Gilden of Cohen Milstein Sellers & Toll PLLC, and Eduard Korsinsky, Nicholas I. Porritt, Adam M. Apton and Alexander Krot of Levi Korsinsky LLP.
The article can be read on Law360. (Subscription required.)