About the author

David Priebe, a partner of DLA Piper LLP (US), has practiced law for over twenty-five years in the Silicon Valley, California.  His principal focus is the defense of issuers, officers, and directors in securities fraud and corporate governance matters.  This includes private investor cases (class action and individual plaintiffs), shareholder derivative and merger cases, government investigations and litigation, corporate investigations, and pre-litigation disclosure and stock trading counseling.  David also has defended consumer class actions, intellectual property cases, and other litigation or government matters for technology and life sciences companies, in both federal and State courts.

PROFESSIONAL PHILOSOPHY

The law is based on precedent and reason.  It is the lawyer’s job to mine these sources of knowledge in order to defend the client’s interests and reputation.  Living in the Silicon Valley, the natural and proper method is to do so in a spirit of innovation and cross-disciplinary thinking.  Thus, based on his

         Deep study and knowledge of the law and the American court system

         Listening to the client

         Factual investigation and analysis

         Experience in litigating all types of cases for all types of businesses, and

         Collaboration with his colleagues across the USA and (if needed) around the world,

if there is a valid and material legal or factual argument to be made on your behalf, David will find it and assert it.  In the securities and corporate governance area in particular, David systematically stays informed of and writes about new cases and regulations and owns and publishes this Internet site.

REPRESENTATIONS

In securities fraud and corporate governance matters, David has represented current or former officers and directors of Countrywide Financial Corporation, KLA-Tencor, Tripath Technologies, Sipex Corporation, and Riverstone Networks; and the company and management or directors of Finisar, Applied Signal Technology, Las Vegas Sands Corp., AXT, Santa Cruz County Bank, Openwave Systems, Foundry Networks, Monterey Pasta Company, Strategic Realty Trust, Trident Microsystems, Vantive, Extreme Networks, Immersion, Informatica, iPrint Technologies, InsWeb, NetRatings, Agile Software, ValiCert, Preview Systems, Virage, Calico Commerce, SONUS Pharmaceuticals, Genentech, The Boeing Company, Sybase, Indus International, Silicon Graphics, Informix, Seagate Technologies, Vanstar, Read-Rite, 3DO, Merisel, YES! Entertainment, Cirrus Logic, Silicon Valley Bank, Digital Microwave, Thomas Weisel Partners, Montgomery Securities, PaineWebber, MIPS Technologies, Frame Technologies, Novasensor, and Businessland.

Outside of the securities area, David also co-lead counsel in a successful lending \ securities fraud arbitration on behalf of a defrauded borrower and a pro bono civil rights trial.  From time to time, David also has represented companies in intellectual property and commercial cases, representing (among others) the Williams Companies, Borland, Network Associates, American Mensa Ltd., and Packard Bell; and in matters involving FDA regulations.  David came to the Silicon Valley from the East Coast because he respected the contributions of technology companies, and is interested in advancing their valid interests in every way he can.


CAREER HIGHLIGHTS

Represented the former CFO of Countrywide Financial Corporation in numerous class action, institutional, and regulatory lawsuits involving common stock purchasers and mortgage-backed securities investors.

Won a motion to dismiss ruling that directors who sign an exemplar registration statement for a mortgage-backed securities offering are not liable under Section 11 of the Securities Act for alleged false statements in the prospectus supplements used later to conduct individual offerings.  In re Countrywide Financial Corp. Mortgage-Backed Sec. Litig., 932 F. Supp. 2d 1095 (C.D. Cal. 2013).   Our opponent in the case called our position unprecedented—and we agreed that it was, and then persuaded the judge that it was correct.

Our other cases include SEC action that resulted in a settlement without fraud claims or an officer and director bar against our client, Securities & Exch. Comm’n v. Mozilo, No. CV 09-03944 (C.D. Cal.); two State court cases dismissed on our motions for lack of personal jurisdiction, New Mexico State Investment Council v. Countrywide Fin. Corp., No. D-0101-CV-2008-02289 (Santa Fe Cty. N.M., 1st Jud. Dist. Apr. 14, 2009), United Western Bank v. Countrywide Financial Corp., No. 2010CV3325 (Dist. Ct. Colo., City and Cty. of Denver 2d Jud. Dist. Nov. 9, 2010), and Western & Southern Life Ins. Co. v. Countrywide Fin. Corp., Nos. 2:11-cv-07166 MRP etc., 2012 WL 1097244 (C.D. Cal. Mar. 9, 2012); and a summary judgment victory on a joint motion arguing that the statute of repose for Securities Act claims cannot be extended or tolled.  Footbridge Ltd. Trust v. Countrywide Fin. Corp., 770 F. Supp. 2d 618 (S.D.N.Y. 2011).


Won dismissal of a securities class action case by obtaining the first judicial decision applying a Rule 10b5-1(c) stock trading plan to negate an inference of scienter in a private securities case.  Wietschner v. Monterey Pasta Co., 294 F. Supp. 2d 1102 (N.D. Cal. 2003).  This followed several years of research and public speaking on the Rule, including the submission of public comments on it before it was adopted.  We also won the dismissal of parallel shareholder derivative lawsuit in the Superior Court of California, Monterey County.


Defeated an injunctive challenge to sale high technology defense contractor, then won complete motion to dismiss after the transaction closed based on the novel argument that the action was derivative in nature under California law (unlike Delaware law).  Jarackas v. Applied Signal Technology, Inc., No. 1:11 CV 191643 (Superior Court of California, Santa Clara County).


Won a motion to dismiss claims under Section 12(a)(2) of the Securities Act against a regional bank that allegedly solicited the sale of interest in an investment fund operated by Ponzi schemers.  Bridges v. Geringer, No. 5:13-cv-01290-EJD, 2015 WL 2438227 (N.D. Cal. May 21, 2015).  We prevailed on the basis that the complaint did not allege that our client used the means of interstate commerce in the alleged communications with investors.  Again, our opponent called our position unprecedented in the context of this statute—and we agreed that it was, and then persuaded the judge that it was correct.  We also won on the basis that the complaint did not allege that our client had any financial interest in the sales and hence was not a solicitor under the statute.


Wrote an article for a securities litigation professional journal in 1999, contending that shareholder derivative cases based on allegations also asserted in a parallel securities class action against the corporation were not in a corporation’s best interests and should be stayed or dismissed.  Piling On: The Reemergence Of The Parallel Derivative Lawsuit As The Federal Securities Class Action Window Closes, 1136 PLI/Corp 333 (PLI Sept.-Oct. 1999).  At the time, while one case had suggested the concept, there were no decisions actually applying it.  Since then, numerous courts have applied my position to dismiss or stay such cases.


Won a decision declining to apply in a California court a Delaware law presumption that an increase in the price of a challenged transaction followed the filing of an M & A lawsuit challenging the same was caused by the plaintiff’s attorneys and justifies awarding them fees.  Capgrowth Group v. Vij, No. 1:12 CV 236874 (Superior Court of California, Santa Clara County Feb. 6, 2015).


Won a motion to dismiss a shareholder derivative lawsuit based on plaintiff’s failure to plead contemporaneous ownership, where issue had not been raised when the shareholder had sent a pre-litigation demand on the corporation.  Sokolowski v. Las Vegas Sands Corp., No. 14-cv-00111-JCM, 2014 WL 3748191 (D. Nev. July 30, 2014).


As an associate at my prior firm, selected and served as the principal legislative history researcher in support of advanced interpretation arguments in the seminal Reform Act case in the Ninth Circuit, In re Silicon Graphics Securities Litigation.  In this capacity, was first to call attention to statute and legislative history requiring disclosure of all facts underlying allegations—which proved to be the key basis for the Ninth Circuit’s affirmance of the dismissal.


Served as the principal factual and legal researcher in detailed analyses leading to decision denying an officer and director bar against the former CEO of a semiconductor manufacturing company alleged to have engaged in stock option backdating.  Securities & Exch. Comm’n v. Schroeder, No. C 07-03798 JW, 2010 WL 4789441 (N.D. Cal. Nov. 17, 2010).  In the related private litigation, our client recovered over $13 million from the company, which initially had attempted to blame our client for suboptimal practices.


Won a motion to dismiss securities class action against substrate manufacturer alleged to have misrepresented quality of products to customers.  Morgan v. AXT, Inc., Nos. C 04-4362 etc., 2005 WL 234125 (N.D. Cal. Sept. 23, 2005).  The case was settled on favorable terms following the dismissal (no contribution from company).


Represented the entire Board of Directors of audio chip company in breach of fiduciary lawsuit filed by bankruptcy trustee alleging a failure to sell the company.  Case settled without payment from clients.  Hermerding v. Tripathi, Adversary Proceeding No. 09 5004 (N.D. Cal. Bank.).


Won motion to dismiss securities fraud claims under Securities Litigation Uniform Standards Act in lawsuit filed when corporation temporality suspended exercise of stock options until restated financial statements were issued.  McIntosh v. McAfee Inc., No. C-06-0794 JW (N.D. Cal. Sept. 28, 2007).


Won as lead counsel and co-lead arbitration a $46.5 million arbitration award on behalf of a defrauded borrower unknowingly involved in what the case investigation revealed to be a widespread, international Ponzi scheme.  General Holding, Inc. v. Derivium Capital (Charleston, S.C., American Arbitration Ass’n June 13, 2005).


Played a leading role in issuers’ joint defense group in the defense of the over 300  “IPO laddering” securities cases in the Southern District of New York.  In re Initial Public Offering Sec. Litig., No. 21 MC 92 (SAS).


Represented former CEO of a semiconductor chip company in securities class action lawsuit and parallel government investigations.  The securities class action settled with no contribution from our client, In re Sipex Corp. Sec. Litig., Master File No. 05-CV-00392 (WHA); and an SEC action settled with no fraud claim and no officer and director bar against our client; despite attempts to blame him for allegedly improper practices.


Successfully defended American Mensa in a copyright lawsuit based on the alleged infringement of intelligence text by New Zealand and Australia Mensa branches by presenting record that foreign entities were not affiliated with US group or subject to jurisdiction.  Publicly praised by the worthy plaintiff after the fact as well qualified to be a Mensa member.


Drafted briefs and declaration that resulted in granting of motion to dismiss, and change in plaintiff’s approach, in derivative case alleging that officers and director steered company to investment banker in exchange for access to IPO shares.  Lefort v. Black, No. 02 2464 VRW (N.D. Cal. 2002).  After the filing of our second motion to dismiss, plaintiff made a demand on the Board, as we had contended was required.  The subsequent investigation (by separate counsel) exonerated our clients and resulted in a voluntary dismissal.


Served as co-lead trial counsel on behalf of plaintiff in pro bono civil rights case, Simpson v. McNack, No. CV 06-04837 EMC (N.D. Cal. 2010).  The jury found for our client as against one defendant, and the case settled on favorable terms during the post-verdict judgment phase.


Won motion to dismiss securities class action lawsuit against intelligence contractor alleged to have misrepresented customer backlog.  In re Applied Signal Tech., Inc. Sec. Litig., No. C 05-1027 SBA, 2006 WL 1050174 (N.D. Cal. Feb. 9, 2006).  Although the decision was reversed three years later by the Ninth Circuit, the strength of the district court’s acceptance of our contentions positioned case well and resulted in a settlement on favorable terms (no contribution from company).


Drafted briefs and declarations that resulted in granting of summary judgment on behalf of a leading software company alleged to have issued false forecasts.  In re Sybase, Inc. Sec. Litig., 48 F. Supp. 2d 958 (N.D. Cal. 1999).


Drafted briefs that resulted in rare pre-Reform Act dismissal of securities class action case alleging that pioneering video game company misrepresented the performance and quality of its product.  In re 3DO Sec. Litig., No. CV 94-1820 CAL (N.D. Cal. July 19, 1995).  The case settled on favorable terms after the dismissal (no contribution from company).


Drafted briefs and declarations that resulted in granting of motions to dismiss on behalf of computer distributor alleged to have issued false forecasts.  In re Merisel Sec. Litig., Master File No. CV-94-3959-R (C.D. Cal. Apr. 3, 1995).  Although the decision was reversed two years later by the Ninth Circuit, the strength of the district court’s acceptance of our contentions positioned case well and resulted in a settlement on favorable terms (no contribution from company).


Assisted in drafting of brief result in grant of motion to dismiss class action complaint challenging terms of acquisition of high technology company on basis of State law preemption.  Barth v. NovaSensor, No. C-91-0830-DLJ, 1991 WL 330922 (N.D. Cal. Dec. 6, 1991).


Served as chief legal researcher on damages issues, and confirmed validity of key procedural step resulting in interlocutory win on the merits, in a copyright case that reached the United States Supreme Court,  Lotus v. Borland.


PRIOR PROFESSIONAL EXPERIENCE


Member (Partner), Wilson Sonsini Goodrich & Rosati, 1999-2001


Associate, Wilson Sonsini Goodrich & Rosati, 1990 1999


Judicial Extern, Honorable Milton Schwartz, United States District Court, Eastern District of California, 1988


PUBLICATIONS AND SPEECHES


David has written numerous articles and comments on the securities laws, insider trading, derivative lawsuits, and document retention policies, including the following:


Securities and Exchange Board of India Adopts Broad Prohibitions On Insider Trading And Disclosure (March 2015) (with Rajiv Dharnidhaka)


Sophisticated New Securities and Exchange Board of India Insider Trading And Disclosure Regulations Present Interesting Comparisons To US Securities Laws (March 2015) (with Rajiv Dharnidhaka)


Reason Enough:  The Potential Implications Of Omnicare, Inc. v. Laborers’ District Counsel Construction Industry Pension Fund (January 2015) (with Shirli Weiss)


Second Circuit Clarifies Law of Insider Trading In Reversing Convictions Of Remote Tippees (December 2014) (with Edward Johnsen and Patrick Hunnius)


Securities Litigation and the Departing High Level Officer (June 2014) (with Shirli Weiss)


Sarbanes-Oxley Act Covers Public Companies’ Contractors and Subsidiaries (March 2014) (with Rachel Cowen and Jamie Konn)


Consent Decrees With The United States Securities And Exchange Commission (June 2012)


A Missed Opportunity To Define Insider Trading:  United States v. Heron (PLI 2009) (with Shirli Weiss)


The Good, The Bad And The Ugly:  The Triangular Contest Over Privileged Information Relevant To Securities Litigation (PLI 2008) (with Shirli Weiss)


Tellabs:  Supreme Court Strengthens Pleading Standards For Securities Fraud Claims (2007) (with Robert Brownlie)


SEC Announces Factors Influencing Assessment Of Monetary Penalties Against Corporations (2006) (with Deborah Meshulam)


Five Tenets of a Document Retention Policy, 18:7 INSIGHTS 2 (July 2004) (with Diane Frankle)


State High Court Ruling Expands Securities Fraud Claims, 11:9 WASHINGTON LEGAL FOUNDATION COUNSEL’S ADVISORY (July 25, 2003) (with Paul Reynolds)


Enron Provides Lesson on Audits For Accountants & Public Companies, 17:14 WASHINGTON LEGAL FOUNDATION LEGAL BACKGROUNDER (Mar. 8, 2002) (with Henry C. Montgomery)


Financial Fraud Lawsuits: The Case For Stricter Judicial Scrutiny, 7:5 ANDREWS SECURITIES LITIGATION AND REGULATION REPORTER 15 (Sept. 26, 2001) (with Shirli Fabbri Weiss)


Who is Responsible for Financial Fraud?, 1203 PLI/Corp 651 (Sept. 21, 2000)


Piling On: The Reemergence Of The Parallel Derivative Lawsuit As The Federal Securities Class Action Window Closes, 1136 PLI/Corp 333 (PLI Sept.-Oct. 1999)


Directors’ Reliance On Internal Controls In Light of Caremark And W.R. Grace, 1070 PLI/Corp 285 (PLI Sept.-Oct. 1998) (with Bruce G. Vanyo)


The Pleading Standards and the Safe Harbor Provisions Of The Private Securities Litigation Reform Act of 1995, 1070 PLI/Corp 103 (PLI Sept.-Oct. 1998) (with Bruce G. Vanyo, Lloyd Winawer and Rebecca C. Mitchells)


Federal Securities Law and the Internet, 1 CYBERSPACE LAWYER 4 (July 1996) (with Boris Feldman)


Many of these articles are republished on www.10b-5.com.  David has also spoken on these topics, and in particular on Rule 10b5-1(c) stock trading plans and Compensation Committee issues 

© David Priebe 2016