Janney Montgomery Scott LLC Wins Dismissal of $1 Billion Action

Skadden won an appeal securing dismissal of an action seeking over $1 billion in damages in the New York Commercial Division against client Janney Montgomery Scott LLC and two other defendants. The plaintiff, hedge fund manager Visium Asset Management, asserted aiding and abetting breach of fiduciary duty claims against the defendants, alleging that their employees provided “sham” quotes relating to the securities held in Visium’s funds. After the trial court denied defendants’ motion to dismiss, they appealed the decision to the Appellate Division, First Department. Skadden briefed and argued the appeal. On December 10, 2020, the First Department unanimously reversed the trial court’s decision and directed the action to be dismissed on the ground that the plaintiff's claims were barred by the doctrine of "in pari delicto" based on its own employees' alleged misconduct.