Appeals court revives Signature Bank shareholder lawsuit
The 2nd U.S. Circuit Court of Appeals on a 3-0 vote revived a shareholder lawsuit over Signature Bank's March 2023 collapse, ruling the FDIC's receivership did not extinguish shareholders' personal right to sue. The court rejected the FDIC's invocation of a 1989 succession clause as transferring ownership of those claims and cited a 2021 Supreme Court precedent. Shareholders led by the Swedish pension fund Sjunde AP-Fonden accuse seven former executives, directors and auditor KPMG of misrepresenting liquidity risks and inflating the share price. The case returns to district court and the ruling leaves open broader questions about FDIC powers.
Shareholders can sue despite FDIC receivership under 1989 law
Context
Regulators closed Signature Bank on March 12, 2023 after big customer withdrawals…
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