Practice Areas: Financial Services Litigation

The financial services industry has long been one of the most complex, highly regulated and carefully scrutinized business segments in the world. The collapse of the credit markets and the mortgage foreclosure crisis have created unprecedented challenges for banks and other financial services institutions, not the least of which has been a tidal wave of lawsuits and government investigations attacking fundamental business practices. In addition, banks have been forced to both anticipate and react swiftly to a wide array of new regulations.

McGuireWoods’ long history of representation of financial institutions has prepared the firm well to stand with its clients in meeting these multi-faceted and unprecedented challenges. Because we understand the business, our Financial Services Litigation Team is called upon by some of the world’s most prominent financial institutions to meet these challenges.

A centerpiece of our practice is the Consumer Financial Services Litigation Group. They have developed deep experience in the “alphabet-soup” of regulatory regimens that have generated waves of litigation in recent years: TILA, RESPA, FDCP, FCRA, and more. We are currently defending dozens of individual and class action claims across the country that attack mortgage servicing and foreclosure practices. We have also represented credit card issuers and servicers in individual and class actions alleging that their marketing programs and disclosure practices violate these federal and state consumer protection laws.

A creative claim by a lone borrower can become a class action, or result in a regulatory investigation, a securities claim, or a shareholder derivative action. The institution may have to force a recalcitrant insurer to step up to join in the defense. Our Securities, Class Actions, Government Investigations & White Collar Criminal, Shareholder/Directors & Officers Litigation, Accountants Defense, and Insurance Teams are fully integrated with our Financial Services Litigation Practice, providing the full range of knowledge that our clients need to meet each new challenge.

In addition, our Financial Services Litigation Practice encompasses the broad array of claims that our financial institution clients face, simply as a result of their day-to-day business activities:

• Loan workout, receivership and lender liability actions, often involving our Restructuring/Insolvency Team.
• Disputes under Articles 3, 4 and 4A of the Uniform Commercial Code, including fraudulent endorsements and fictitious payees.
• Failed asset securitizations and defaulted syndicated loans, representing both lead lenders and participants.
• Intercreditor disputes, including issues relating to the perfection and priority of security interests and the interpretation of lien or payment subordination agreements.
• Responding to claims of breach of fiduciary duty by bank trust departments resulting from alleged poor investment performance.
• Defending claims against and investigations of Broker/Dealers by the SEC, FINRA, and state regulators.
• Responding to breach of privacy claims by bank customers.
• Conversion claims relating to consumer and commercial deposit accounts, and application of National Automated Clearinghouse Association rules and regulations.
• Defending individual and class actions challenging employment practices of bank clients, utilizing the knowledge and experience of our Labor and Employment Group.
• Commercial disputes with vendors, lessors and suppliers, business torts, and intellectual property protection matters.

Finally, we call on our Discovery Counsel Services Team to effectively manage the collection and management of the massive quantities of data that are generated by financial institutions in the ordinary course of business. This team has a national reputation for efficient and comprehensive management of bank data. They have been integral to the defense of many matters.

Representative Matters

• Representation of a Fortune 20 financial institution includes dozens of individual and class actions across the country arising from the mortgage foreclosure crisis. The firm also represents the institution in related shareholder litigation and state and federal investigations.
• Representation of a Fortune 20 financial institution in a series of lawsuits to recover the proceeds of insurance policies written to cover hundreds of millions of dollars in defaults on home equity loans and home equity lines of credit.
• Representation of a number of Fortune 500 banks in multiple actions claiming fraud and violation of the Interstate Land Sales Full Disclosure Act, and seeking rescission of lot loans in failed developments of resorts and other planned communities.
• Representation of a Fortune 20 bank in a $40 million fraud action against the bank’s outside security vendor, which received kickbacks from a bank officer in exchange for submission of inflated invoices. The matter involved close cooperation with the U.S. Attorney’s Office in parallel criminal proceedings against the defendants.
• Representation of a Fortune 20 bank in a putative nationwide class action involving the lender’s adjustable rate mortgage products.
• Representation of a Fortune Global 500 bank in an action in the U.S. Bankruptcy Court for the Southern District of New York brought by the bankruptcy estate of a cable provider that unsuccessfully sought to assert more than $300 million in claims for fraud, breach of fiduciary duty, and violations of the Bank Holding Act.
• Representation of a Big Four accounting firm in a direct action brought by shareholders of the accounting firm’s publicly-traded client to recover losses in the stock price that allegedly resulted from misleading financial statements. The court dismissed the claims, determining that claims by holders of stock could only be brought derivatively.
• Representation of one of the country’s largest mortgage lenders in a nationwide class action alleging violations of the Real Estate Settlement Procedures Act based on the methodology of accounting for and refunding of escrow deposits.