Judge Denies Class Certification in UBS Puerto Rico Case

Skadden successfully opposed class certification in a putative securities class action brought against UBS Financial Services Incorporated of Puerto Rico, UBS Trust Company of Puerto Rico and Carlos Ortiz. The plaintiffs alleged that UBS Puerto Rico brokers systematically misled their customers about the liquidity of shares of closed-end mutual funds that primarily invested in Puerto Rico securities and misrepresented the funds as safe investments. On Sept. 30, Judge Carmen Consuelo Cerezo of the U.S. District Court for the District of Puerto Rico denied class certification. The court adopted a magistrate judge's report and recommendation (also obtained by Skadden) finding that the proposed class could not be certified because individualized issues of reliance predominated over common issues and that the plaintiffs had failed to show that the UBS Puerto Rico brokers made uniform misrepresentations to the putative class.