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Harry S. Davis

919 Third Avenue
New York, New York 10022
United States of America
P: +1 212.756.2222
E:

Harry S. Davis is a partner in the New York office, where his practice focuses on complex commercial litigation and regulatory matters for financial services industry clients, including hedge funds, funds of funds and private equity funds, prime and clearing brokers, and auditors and administrators. Harry has substantial experience in both securities regulatory matters and private litigation, including investigations by the Securities and Exchange Commission, U.S. Attorneys' Offices, the Department of Justice, the Commodities Futures Trading Commission, the Federal Trade Commission, state attorneys general, state securities regulators and self-regulatory organizations.

Harry has litigated numerous cases in federal and state courts throughout the United States, including his recent victory for an inter-dealer broker in an arbitration brought by one of its competitors for alleged misappropriation of trade secrets and his successful representation of a prime broker in a hotly contested and high-profile jury trial brought by the bankruptcy trustee of a failed hedge fund. Over the course of a career spanning more than 25 years, Harry has represented clients in investigations and litigations involving allegations of insider trading, market manipulation, market timing and late trading, misconduct involving PIPEs, short-swing profits, securities and common law fraud, advertising, breach of fiduciary duty and breach of contract, among other claims. To prevent minor issues from growing into bigger problems, he provides litigation and compliance counseling to many of the firm’s clients, and conducts internal investigations.

Selected Representations

Obtained an award in favor of interdealer broker Tullett Prebon in an AAA Arbitration alleging misappropriation of trade secrets. In doing so, successfully invalidated the contractual damages provision relied upon by rival BGC Partners in seeking approximately $2 billion in damages. Following trial, the arbitrator awarded BGC less than $1 million in damages in this “bet the company” case and found that BGC was not the prevailing party and, therefore, was not entitled to attorney’s fees despite the fact that Tullett had conceded liability. Successfully defended the arbitration award in response to a motion to vacate it in New York Supreme Court as well as on appeal to the Appellate Division, which found that the Arbitrator’s conclusion that the provision was unenforceable to be “inescapable” based upon the evidence Tullett had introduced in the arbitration hearing. BGC v. Tullett (AAA Arbitration, NY Supreme Court and Appellate Division, 1st Department). Also successfully obtained a dismissal of a parallel case brought in New York State Supreme Court based in part on the AAA decision.  

Successfully represented Bear Stearns Securities Corp. in connection with a series of individual and class action lawsuits filed by shareholders and the bankruptcy trustee of Manhattan Investment Fund Ltd., a hedge fund that collapsed following disclosure that its manager concealed approximately $400 million in losses through the creation of false account statements. Defeated allegations that Bear Stearns, which had provided clearing services to the fund, aided and abetted the manager’s fraud, breached its fiduciary duty and violated fraudulent transfer laws, including winning a jury verdict for Bear Stearns. Manhattan Investment Fund, Ltd. Litigations (2nd Circuit Ct. App., S.D.N.Y., Bankr. S.D.N.Y. and N.Y. Sup. Ct.).

Successfully defended hedge funds involved in activist campaign in connection with claims alleging violations of Investment Company Act anti-pyramiding provisions, market manipulation, proxy fraud, participation in an undisclosed group and violation of short-swing profit rules. meVC Draper Fisher Jurvetson Fund I, Inc. v. Millennium Partners, L.P. (S.D.N.Y.).

Successfully represented domestic and offshore hedge funds in connection with PIPEs investigations by the SEC, the New York State Attorney General and other state securities regulators involving claims of insider trading, market manipulation and other purported securities law violations.

Obtained dismissal of a lawsuit against hedge funds in a novel fraudulent transfer case brought by the bankruptcy trustee of JTS Corporation arising from investments in convertible preferred stock and the subsequent conversion of that stock into common shares. Decker v. Advantage Fund, Ltd., et al. (Bankr. N.D. Cal., N.D. Cal. and 9th Circuit Ct. App.).

Successfully represented investors in the takeover of the board of directors of an offshore and master fund and in gaining control over a domestic fund after disclosure by the fund manager that he had acquired concentrated positions in various life sciences companies. On behalf of the funds, negotiated with those life sciences companies to resolve disputes under Sections 13 and 16 of the Securities Exchange Act of 1934, neutralizing a highly dilutive poison pill, and obtained dismissal of a securities fraud class action filed against the funds by short sellers of the life sciences companies. Also successfully represented the funds in connection with investigations by the SEC, the U.S. Attorney's Office, the FTC and the Cayman Islands Monetary Authority, resulting in no claims being brought against the funds even though civil and criminal charges were filed against the fund manager. Durus Life Sciences Funds Litigation.

Achieved a favorable settlement for a hedge fund in connection with an investigation by the SEC and the New York State Office of the Attorney General relating to market timing and late trading, and representing another hedge fund in connection with investigations being conducted by multiple offices of the SEC, the NYAG and the U.S. Attorney's Office relating to market timing.

Successfully represented a substantial limited partner in LJM2 Co-Investment, LP in connection with removal of a general partner, including litigation confirming the removal, related SEC and Congressional investigations, and other litigation matters. In re Enron Corporation.

Successfully represented a corporation and certain directors in litigation alleging breach of fiduciary duty arising from sale of the company. In re Morton’s Restaurant Group Shareholders Litigation (Del. Ch. Ct. and N.Y. Sup. Ct.).

Obtained dismissals of class action lawsuits in Indiana, Michigan, North Carolina and Tennessee alleging violations by Credit Suisse First Boston Mortgage Securities Corp. of various state-law consumer protection statutes relating to second mortgage loans made to homeowners by originating lenders and subsequently securitized by CSFB. Class action in Missouri pending.

Represented generic pharmaceutical manufacturer in connection with FTC investigation and related federal and state court civil antitrust litigation relating to competitors’ settlement of patent infringement litigation. In re Cardizem CD Antitrust Litigation.

Has conducted internal investigations and handled regulatory investigations for numerous private investment funds relating to alleged insider trading, market manipulation and compliance with securities laws.

Regularly provides securities law counseling and advice to financial services industry clients, including hedge funds, private equity funds, underwriters and broker-dealers, in connection with insider-trading issues, including SEC and FINRA investigations; questions relating to market manipulation, ethical walls, short-swing profit rules and group issues; and other securities law and regulatory issues.

Has provided antitrust counseling and advice, including the preparation of competition studies for submission to the FTC, the Antitrust Division of the Department of Justice and the Federal Reserve Board, in connection with mergers & acquisitions in the following industries: banking, commercial finance, factoring, commercial equipment finance, commodities brokerage, rental cars, paper manufacturing, automobile manufacturing and financing, subprime lending, information technology, pharmaceuticals, glass container manufacturing, oil & gas equipment sales and leasing, and travel-related businesses.

Has provided antitrust and trade practices counseling and advice in connection with the review of various business practices, including product distribution, exclusive dealing and licensing agreements, intra-enterprise conduct, interlocking directors, joint ventures and strategic alliances, and Hart-Scott-Rodino issues.

Selected Publications

Insider Trading Law and Compliance Answer Book, editor; “Overview of the Law of Insider Trading,” “Materiality” and “Breach of Duty: Misappropriation Theory,” author (Practising Law Institute) 2011-2015

“District Court Adopts Subjective Good Faith Defense for Fraudulent Transfer Claims in SIPA Case,” Pratt’s Journal of Bankruptcy Law, July/August 2014 (co-author)

SRZ Insider Trading Developments Newsletter, Summer 2014 (contributor)

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Selected Speaking Engagements

“Securities Enforcement and Related Civil Litigation,” SRZ 23rd Annual Private Investment Funds Seminar, January 2014

“Regulatory Examinations and Enforcement,” SRZ 22nd Annual Private Investment Funds Seminar, January 2013

“What Changes are Being Made to Prevent Insider Trading,” IIR GAIM Ops Cayman, Cayman Islands, April 2012

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Memberships

American Bar Association
New York State Bar Association
New York County Lawyer’s Association
Trade Regulation Committee
     Chairman, 2003-04
     Co-Chairman, 2002-03
     Vice Chairman, 2001-02
New York City Bar Association
Securities Industry and Financial Markets Association
     Compliance and Legal Division
Federal Bar Council
Federalist Society

Other Distinctions

The Legal 500 United States
New York State Bar Association Empire State Counsel Honoree
New York Super Lawyers

Bar Admissions

  • New Jersey
  • New York

Court Admissions

  • U.S. Court of Appeals, First Circuit
  • U.S. Court of Appeals, Second Circuit
  • U.S. Court of Appeals, Third Circuit
  • U.S. Court of Appeals, Ninth Circuit
  • U.S. District Court, Eastern District of New York
  • U.S. District Court, Southern District of New York
  • U.S. District Court, Western District of New York
  • U.S. District Court, Northern District of New York
  • U.S. District Court, District of New Jersey

Education

  • Cornell Law School, J.D., magna cum laude, 1988
    • Order of the Coif
    • Editor, Cornell Law Review
    • Member, Moot Court Board
  • Johns Hopkins University, B.A., 1984
    • Departmental Honors

Prior Experience

Associate, Cravath Swaine & Moore, 1989-1995
Judicial Clerk, Hon. Joseph L. Tauro (D. Mass.), 1988-89