backAUSTIN, April 24, 2017 — King & Spalding secured a significant Fifth Circuit victory on behalf of former officers of ATP Oil & Gas Corporation, a Texas-based energy company that was forced into bankruptcy by the Deepwater Horizon disaster and ensuing moratoria on deepwater drilling and production in the Gulf of Mexico.
In an opinion issued on April 21, the Fifth Circuit affirmed an August 2015 district court dismissal of a putative class action filed by ATP shareholders under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. The shareholders accused ATP’s former officers of committing securities fraud by misrepresenting various aspects of the company’s business prior to bankruptcy, including its production from a particular oil-and-gas well, its liquidity, and the resignation of its CEO. The Fifth Circuit held that the shareholders failed to satisfy the heightened standard for pleading scienter.
The Austin-based King & Spalding team included partners Paul Bessette, who co-chairs the firm's Securities Litigation Group, and Mike Biles, along with associates James P. Sullivan and Tyler Highful.
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