Legal Procedures in Financial Disputes Flashcards

Under FRCP 9(b), how must a plaintiff plead a claim of securities or investment fraud?

Answer: With particularity as to the circumstances constituting fraud

Rule 9(b) requires fraud circumstances (who, what, when, where, how) to be stated with particularity, though intent may be alleged generally.

Under the PSLRA, as interpreted in Tellabs v. Makor, what must a securities fraud complaint allege regarding scienter?

Answer: Facts giving rise to a strong inference of scienter at least as compelling as any opposing inference

Tellabs held the inference of scienter must be cogent and at least as compelling as any opposing innocent inference.

A lender sues a borrower from another state in federal court on diversity grounds. What minimum amount in controversy is required?

Answer: More than $75,000, exclusive of interest and costs

28 U.S.C. § 1332(a) requires the matter in controversy to exceed $75,000 exclusive of interest and costs.

Absent a waiver of service, how long does a defendant served with a federal summons have to answer under FRCP 12(a)?

Answer: 21 days after service

Rule 12(a)(1)(A)(i) gives a served defendant 21 days to serve an answer.

A domestic defendant timely returns a Rule 4(d) waiver of service. How long does it have to answer, measured from when the request was sent?

Answer: 60 days

Waiving service extends the answer deadline to 60 days from the request (90 days if sent outside the U.S.).

A bank sued in state court wishes to remove the case to federal court. Generally, within what period must it file the notice of removal?

Answer: 30 days after receiving the initial pleading through service or otherwise

28 U.S.C. § 1446(b)(1) requires removal within 30 days of receipt of the initial pleading.

Before filing a Rule 11 sanctions motion against an opponent's frivolous pleading, the movant must serve the motion and allow how long for withdrawal or correction?

Answer: 21 days

Rule 11(c)(2) contains a 21-day safe harbor before the motion may be filed with the court.