Skip to Main Content

Sharan Nirmul

Partner

D   484.270.1465
F   610.667.7056

Sharan Nirmul, a partner of the Firm, concentrates his practice in the area of securities, consumer and fiduciary class action and complex commercial litigation, exclusively representing the interests of plaintiffs and particularly, institutional investors.

Sharan represents a number of the world’s largest institutional investors in cutting edge, high stakes complex litigation. In addition to his securities litigation practice, he has been at the forefront of developing the Firm’s fiduciary litigation practice and has litigated ground-breaking cases in areas of securities lending, foreign exchange, and MBS trustee litigation. Mr. Nirmul was instrumental in developed the underlying theories that propelled the successful recoveries for customers of custodial banks in Compsource Oklahoma v. BNY Mellon, a $280 million recovery for investors in BNY Mellon’s securities lending program, and AFTRA v. JP Morgan, a $150 million recovery for investors in JP Morgan’s securities lending program. In Transatlantic Re v. A.I.G., Mr. Nirmul recovered $70 million for Transatlantic Re in a binding arbitration against its former parent, American International Group, arising out of AIG’s management of a securities lending program.

Focused on issues of transparency by fiduciary banks to their custodial clients, Mr. Nirmul served as lead counsel in a multi-district litigation against BNY Mellon for the excess spreads it charged to its custodial customers for automated FX services. Litigated over four years, involving 128 depositions and millions of pages of document discovery, and with unprecedented collaboration with the U.S. Department of Justice and the New York Attorney General, the litigation resulted in a settlement for the Bank’s custodial customers of $504 million. Mr. Nirmul also spearheaded litigation against the nation’s largest ADR programs, Citibank, BNY Mellon and JP Morgan, which alleged they charged hidden FX fees for conversion of ADR dividends. The litigation resulted in $100 million in recoveries for ADR holders and significant reforms in the FX practices for ADRs.

Mr. Nirmul has served as lead counsel in several high-profile securities fraud cases, including a $2.4 billion recovery for Bank of America shareholders arising from BoA’s shotgun merger with Merrill Lynch in 2009. More recently, Mr. Nirmul was lead trial counsel in litigation arising from the IPO of social media company Snap, Inc., which has resulted in a $187.5 million settlement for Snap’s investors, claims against Endo Pharmaceuticals, arising from its disclosures concerning the efficacy of its opioid drug, Opana ER, which resulted in a recovery of $80.5 million for Endo’s shareholders, and claims against Ocwen Financial, arising from its mortgage servicing practices and disclosures to investors, which settled on the eve of trial for $56 million. Mr. Nirmul currently serves as lead trial counsel in pending securities class actions involving General Electric, Kraft-Heinz, and the stunning collapse of Luckin Coffee Inc., following disclosure of a massive accounting fraud just ten months after its IPO. He also currently serves on the Executive Committee for the multi-district litigation involving the Chicago Board Options Exchange and the manipulation of its key product, the Cboe Volatility Index.

Mr. Nirmul received his law degree from The George Washington University National Law Center and undergraduate degree from Cornell University. He was born and grew up in Durban, South Africa.

Speaking Engagements

Sharan is a regular speaker at the Firm’s annual conferences, the Rights & Responsibilities of Institutional Investors in Amsterdam and the Evolving Fiduciary Obligations of Pension Plans in Washington, D.C.

Awards/Rankings

  • Benchmark Litigation Stars, 2020 & 2021
  • Lawdragon 500 Leading Plaintiff Financial Lawyer, 2019-2021
  • Lewis Memorial Award, George Washington National Law Center, 2001, for excellence in clinical practice.
Experience

Current Cases

  • CASE CAPTION Marder v. Campbell Soup Company et al
    COURT United States District Court for the District of New Jersey
    CASE NUMBER 1:2018-cv-14385 (NLH)
    JUDGE Honorable Noel L. Hillman
    PLAINTIFF Oklahoma Firefighters Pension and Retirement System
    DEFENDANTS Campbell Soup Company, , Denise Morrison, and Anthony DiSilvestro
    CLASS PERIOD August 31, 2017 through May 17, 2018

    This securities fraud class action case arises out of Defendants’ materially misleading statements and omissions regarding Campbell’s ability to deliver “profitable growth” in its fresh foods division, Campbell Fresh (“C-Fresh”), which included the Bolthouse Farms brand acquired by Campbell for $1.55 billion in 2012.

    During the Class Period, Defendants consistently provided fiscal 2018 (“FY 2018”) growth projections for C-Fresh, including touting “product innovations” in the Bolthouse beverage business that Defendants claimed would drive profitability in C-Fresh. However, adverse facts known to Defendants, but concealed from investors, showed that growth in C-Fresh was unrealistic and unattainable.

    In reality, because of a nationwide beverage recall and associated production declines, leading into FY 2018 C-Fresh lost critical shelf space when its largest supermarket chain customers, including at least Target, Walmart, Kroger, and Albertsons, excluded Bolthouse products from their “Modular Resets,” which are infrequent periodic shelf space allocations made by retailers to determine which products they will carry on store shelves until the next Modular Reset occurs, and replaced Bolthouse beverages with competitor products including Naked Juice (PepsiCo.), Odwalla Juice (Coca-Cola), Suja Juice and GT Kombucha. The exclusion of Bolthouse products from the Modular Resets foreclosed valuable shelf space at, and associated revenues from, at least Target, Walmart, Kroger, and Albertsons, and made sales growth at these customers impossible in FY 2018.

    Oklahoma Firefighters filed a 124-page amended complaint in January 2021 on behalf of a putative class of investors alleging that Campbell and its former executives, including CEO Denise Morrison and CFO Anthony DiSilvestro, violated Section 10(b) of the Securities Exchange Act by making false and misleading statements and concealing material facts about Campbell’s ability to deliver “profitable growth” in C-Fresh and violated Item 303 of Regulation S-K by failing to disclose known material adverse trends which increased the risk of an impairment charge in the Bolthouse beverage business. As alleged, following the revelation that Campbell was taking a $619 million non-cash impairment charge on C-Fresh, with $514 million attributable to the Beverage and Salad Dressing unit, Campbell’s stock price fell precipitously, causing significant losses and damages to the Company’s investors.

    Defendants’ motion to dismiss is fully briefed and pending before the Honorable Noel L. Hillman.

    Read Second Amended Consolidated Class Action Complaint Here

  •   CASE CAPTION Sjunde AP-Fonden, et al., v. General Electric Company, et al.
      COURT United States District Court for the Southern District of New York
      CASE NUMBER 1:17-cv-08457-JMF
      JUDGE Honorable Jesse M. Furman
      PLAINTIFF  Sjunde AP-Fonden and The Cleveland Bakers and Teamsters Pension Fund
      DEFENDANTS General Electric Company and Jeffrey S. Bornstein
      CLASS PERIOD March 2, 2015 through January 23, 2018, inclusive

    This securities fraud class action case arises out of alleged misrepresentations made by General Electric (“GE”) and its former Chief Financial Officer, Jeffrey S. Bornstein (together, “Defendants”), regarding the use of factoring to conceal cash flow problems that existed within GE Power between March 2, 2015, and January 24, 2018 (the “Class Period”).

    GE Power is the largest business in GE’s Industrials operating segment. The segment constructs and sells power plants, generators, and turbines, and also services such assets through long term service agreements (“LTSAs”). In the years leading up to the Class Period, as global demand for traditional power waned, so too did GE’s sales of gas turbines and its customer’s utilization of existing GE-serviced equipment.  These declines drove down GE Power’s earnings under its LTSAs associated with that equipment.  This was because GE could only collect cash from customers when certain utilization levels were achieved or upon some occurrence within the LTSA, such as significant service work.

    Plaintiffs allege that in an attempt to make up for these lost earnings, GE modified existing LTSAs to increase its profit margin and then utilized an accounting technique known as a “cumulative catch-up adjustment” to book immediate profits based on that higher margin.  In most instances, GE recorded those cumulative catch-up earnings on its income statement long before it could actually invoice customers and collect cash under those agreements. This contributed to a growing gap between GE’s recorded non-cash revenues (or “Contract Assets”) and its industrial cash flows from operating activities (“Industrial CFOA”).  

    In order to conceal this increasing disparity, Plaintiffs allege that GE increased its reliance on receivables factoring (i.e., selling future receivables, including on LTSAs, to GE Capital or third parties for immediate cash).  Through factoring, GE pulled forward future cash flows and, in light of the steep concessions it often agreed to in order to factor a receivable, traded away future revenues for immediate cash.  In stark contrast to the true state of affairs within GE Power—and in violation of Item 303 of Regulation S-K—GE’s Class Period financial statements did not disclose material facts regarding GE’s factoring practices, the true extent of the cash flow problems that GE was attempting to conceal through receivables factoring, or the risks associated with GE’s reliance on factoring.  Rather, Defendants affirmatively misled investors about the purpose of the Company’s factoring practices, claiming that such practices were aimed at managing credit risk, not liquidity

    Eventually, however, GE could no longer rely on this unsustainable practice to conceal its weak Industrial cash flows.  As the truth was gradually revealed to investors—in the form of, among other things, disclosures of poor Industrial cash flows, massive reductions in Industrial CFOA guidance, and a dividend cut that was attributable in part to weaker-than-expected Industrial cash flows—GE’s stock price plummeted, causing substantial harm to Plaintiffs and the Class. 

    In January 2021, the Court sustained Plaintiffs’ claims based on allegations that GE failed to disclose material facts relating its practice of and reliance on factoring, in violation of Item 303, and affirmatively misled investors about the purpose of GE’s factoring practices.  In April 2022, following the completion of fact discovery, the Court granted Plaintiffs’ motion for class certification, certifying a Class of investors who purchased or otherwise acquired GE common stock between February 29, 2016 and January 23, 2018.  In that same order, the Court granted Plaintiffs’ motion for leave to amend their complaint to pursue claims based on an additional false statement made by Defendant Bornstein.  The parties are currently engaged in expert discovery. 

    Read Fifth Amended Consolidated Class Action Complaint Here

    Read Opinion and Order Granting and Denying in Part Motion to Dismiss Here

    Read Order Granting Motion for Class Certification and for Leave to Amend Here

    Click Here to Read the Class Notice

  •   CASE CAPTION          In re Ideanomics, Inc. Securities Litigation
      COURT United States District Court for the Southern District of New York
      CASE NUMBER 1:20-cv-04944-GBD
      JUDGE The Honorable George B. Daniels
      PLAINTIFF Rene Aghajanian
      DEFENDANTS Ideanomics, Inc. (Ideanomics or “the Company”), Alfred Poor, Bruno Wu, Connor McCarthy, and Anthony Sklar (“Individual Defendants”
      CLASS PERIOD March 20, 2020 – June 25, 2020

    This securities fraud class action arises out of Defendants’ misrepresentations and omissions concerning the existence and operations of Ideanomics’ flagship electric vehicle (EV) sales hub, dubbed the “Mobile Energy Global (MEG) Center.” During the class period, Defendants issued a deluge of press releases, and made numerous statements on interviews and earnings calls promoting the MEG Center as a one million square foot facility focused on the sale and conversion of EV fleet vehicles.  Defendants also made statements touting the volume of sales attributable to the MEG Center and the associated MEG business unit, claiming that it would account for the majority of Ideanomics’ revenues in 2020.  Concurrent with their promotion of the MEG Center, Defendants entered into numerous equity financing arrangements with a third party to retire existing, underwater, equity debt financing extended by insiders to Ideanomics, including by affiliated companies to Defendant Wu.  These financiers received Ideanomics stock at discounted rates in exchange for loans to the Company.  As Ideonomic’s stock price popped, those shares were traded into the market. 

    On June 26, 2020, in response to a report issued by market analysts the previous day refuting Ideanomics’ claims concerning the existence of the MEG Center and Ideanomic’s presence at the site, Ideanomics admitted that the MEG Center was only a quarter of the size originally claimed, and now claimed that it was supposedly part of a pre-existing used vehicle market, being utilized by Ideanomics through a partnership with the city of Qingdao, China.  Ideanomics claimed to have committed to rename the supposed Qingdao facility as the MEG Center at a later date, thereby further acknowledging that despite what was said in numerous interviews and press releases, there was no 1one million square foot MEG Center at the time Defendants made their inflationary statements to the market.  Plaintiff’s own post-class period investigation on the ground in China has revealed no MEG Center at the site that Defendants claimed a million square foot operation already existed, that the site is occupied by numerous other businesses, and that hastily erected promotional banners inside and outside of the Qingdao facility still claim that the MEG Center is “coming soon.”

    Lead Plaintiff filed an amended complaint on February 26, 2021 alleging violations of Section 10(b) of the Securities Exchange Act against all Defendants, and violations of Section 20(a) of the Exchange Act against the Individual Defendants. As alleged, Defendants’ June 26, 2020 admissions following the previous day’s analyst reports caused Ideanomics’ per-share share price to drop from $3.09 per share to $1.46, a 53% decline.

    On April 14, 2022, Plaintiff sought leave to amend the complaint and to file a second amended complaint.

    Read Consolidated Amended Complaint Here

  • CASE CAPTION            In re re Kraft Heinz Securities Litigation
    COURT United States District Court for the Northern District of Illinois
    CASE NUMBER 1:19-cv-01339
    JUDGE Honorable Robert M. Dow, Jr.
    PLAINTIFF Union Asset Management Holding AG, Sjunde Ap-Fonden, and Booker Enterprises Pty Ltd.
    DEFENDANTS The Kraft Heinz Company (“Kraft” or the “Company”), 3G Capital Partners, 3G Capital, Inc., 3G Global Food Holdings, L.P., 3G Global Food Holdings GP LP, 3G Capital Partners LP, 3G Capital Partners II LP, 3G Capital Partners Ltd., Bernardo Hees, Paulo Basilio, David Knopf, Alexandre Behring, George Zoghbi, and Rafael Oliveira
    CLASS PERIOD November 5, 2015 through August 7, 2019, inclusive

    This securities fraud class action case arises out Defendants’ misstatements regarding the Company’s financial position, including the carrying value of Kraft Heinz’s assets, the sustainability of the Company’s margins, and the success of recent cost-cutting strategies by Kraft Heinz.

    Kraft Heinz is one of the world’s largest food and beverage manufacturer and produces well-known brands including Kraft, Heinz, Oscar Mayer, Jell-O, Maxwell House, and Velveeta. The Company was formed as the result of the 2015 merger between Kraft Foods Group, Inc. and H.J. Heinz Holding Corporation. That merger was orchestrated by the private equity firm 3G Capital (“3G”) and Berkshire Hathaway with the intention of wringing out excess costs from the legacy companies. 3G is particularly well-known for its strategy of buying mature companies with relatively slower growth and then cutting costs using “zero-based budgeting,” in which the budget for every expenditure begins at $0 with increases being justified during every period.

    Plaintiffs allege that Kraft misrepresented the carrying value of its assets, sustainability of its margins, and the success of the Company’s cost-cutting strategy in the wake of the 2015 merger. During the time that Kraft was making these misrepresentations and artificially inflating its stock price, Kraft’s private equity sponsor, 3G Capital, sold $1.2 billion worth of Kraft stock.

    On February 21, 2019, Kraft announced that it was forced to take a goodwill charge of $15.4 billion to write-down the value of the Kraft and Oscar Mayer brands—one of the largest goodwill impairment charges taken by any company since the financial crisis. In connection with the charge, Kraft also announced that it would cut its dividend by 36% and incur a $12.6 billion loss for the fourth quarter of 2018. That loss was driven not only by Kraft’s write-down, but also by plunging margins and lower pricing throughout Kraft’s core business. In response, analysts immediately criticized the Company for concealing and “push[ing] forward” the “bad news” and characterized the Company’s industry-leading margins as a “façade.”

    Heightening investor concerns, Kraft also revealed that it received a subpoena from the U.S. Securities and Exchange Commission in the same quarter it determined to take this write-down and was conducting an internal investigation relating to the Company’s side-agreements with vendors in its procurement division. Because of this subpoena and internal investigation, Kraft was also forced to take a separate $25 million charge relating to its accounting practices. Plaintiffs allege that because of the Company’s misrepresentations, the price of Kraft’s shares traded at artificially-inflated levels during the Class Period.

    On August 11, 2021, The Honorable Robert M. Dow, Jr. sustained Plaintiffs’ complaint. The case is now in discovery.  In March 2022, Plaintiffs moved for class certification.  

    Read Consolidated Amended Class Action Complaint Here

    Read Opinion and Order Denying Motion to Dismiss Here

    Read Motion for Class Certification Here

  • CASE CAPTION                 In re Luckin Coffee Inc. Securities Litigation
    COURT United States District Court for the Southern District of New York
    CASE NUMBER 1:20-cv-01293-LJL-JLC
    JUDGE Honorable John P. Cronan
    PLAINTIFF Sjunde AP-Fonden and Louisiana Sheriffs’ Pension & Relief Fund
    DEFENDANTS

    Luckin Coffee, Inc. (“Luckin” or “the Company”), Charles Zhengyao Lu, Jenny Zhiya Qian, Jian Liu, Reinout Hendrik Schakel (collectively “Executive Defendants” and together with Luckin, “Exchange Act Defendants”).

    Hui Li, Erhai Liu, Jinyi Guo, Sean Shao, Thomas P. Meier (collectively “Director Defendants”).

    Credit Suisse Securities (USA) LLC, Morgan Stanley & Co. LLC, China International Capital Corporation Hong Kong Securities Limited, Needham & Company, LLC , Haitong International Securities Company Limited, & KeyBanc Capital Markets Inc. (collectively, “Underwriter Defendants”).

    CLASS PERIOD May 17, 2019 – April 1, 2020

    This securities fraud class action arises out of Defendants’ misrepresentations and omissions concerning the financial status of the Chinese coffee company Luckin Coffee, Inc.  During the class period, Luckin promoted a sales model wherein it would operate at a loss for several years for the purpose of gaining market share by opening thousands of app-based quick -serve coffee kiosks throughout China.  Between 2017 and 2018, Luckin claimed its number of stores increased from just nine to 2,073 stores.  It also claimed that its total net revenues grew from $35,302 to $118.7 million in that same period.

    On May 17, 2019 Luckin, through an initial public offering (IPO) offered 33 million ADSs to investors at a price of $17.00 per ADS, and reaped over $650 million in gross proceeds. On January 10, 2020 Luckin conducted an SPO of 13.8 million ADSs pried at $42.00 each, netting another $643 million for the company. Unbeknownst to investors, however, Luckin’s reported sales, profits, and other key operating metrics were vastly inflated by fraudulent receipt numbering schemes, fake related party transactions, and fraudulent inflation of reported costs, among other methods of obfuscating the truth. Following a market analyst’s report wherein the sustainability of Luckin’s business model and the accuracy of its reported earnings were challenged, after conducting an internal investigation, Luckin ultimately admitted to the fraud.

    Plaintiffs filed a 256 page complaint alleging violations of Section 10(b) of the Securities Exchange Act against the Exchange Act Defendants, violations of Section 20(a) of the Exchange Act against the Executive Defendants, violations against Section 11 of the Securities Act against all Defendants, violations of Section 15 of the Securities Act against the Executive Defendants and the Director Defendants, and violations of Section 12(a)(2) of the Securities Act against the Underwriter Defendants.  As alleged, following a series of admissions from Luckin and Defendant Lu admitting the existence and scope of the fraud, Luckin’s share price dropped from $26.20 to $1.38 per share, before ultimately being delisted.

    Luckin is currently undergoing liquidation proceedings in the Cayman Islands, where it is incorporated. Luckin also filed for Chapter 15 bankruptcy in the Southern District of New York.  The Underwriter Defendants and Thomas Meier, an outside director filed motions to dismiss the Complaint which are pending.   None of the Executive Defendants or any other Director Defendants have appeared in this Action and all are residents of the PRC.  They were served pursuant to the Hague Convention.  

    On October 26, 2021, Lead Plaintiffs reached a $175 million settlement with Luckin to resolve all claims against all Defendants.  More information regarding the settlement can be found here.

    Read Consolidated Class Action Complaint Here

    Read Order Granting Motion for Preliminary Approval Here 

Landmark Results

  • Served as co-lead counsel in case alleging that BNY Mellon Bank, N.A. and the Bank of New York Mellon (BNY Mellon) breached fiduciary and contractual duties in connection with its securities lending program. 

    On behalf of the Electrical Workers Local No. 26 Pension Trust Fund, we claimed that BNY Mellon imprudently invested cash collateral obtained under the lending program in medium term notes issued by Sigma Finance, Inc.—a foreign structured investment vehicle that went into receivership—in breach of its common law fiduciary duties, its fiduciary duties under ERISA and its contractual obligations under the securities lending agreements. After the close of discovery, the case settled for $280 million. 

  • As co-lead counsel representing the Maine Public Employees’ Retirement System, secured a $500 million settlement for a class of plaintiffs that purchased mortgage-backed securities (MBS) issued by Countrywide Financial Corporation (Countrywide).

    Plaintiffs alleged that Countrywide and various of its subsidiaries, officers and investment banks made false and misleading statements in more than 450 prospectus supplements relating to the issuance of subprime and Alt-A MBS—in particular, the quality of the underlying loans. When information about the loans became public, the plaintiffs’ investments declined in value. The ensuing six-year litigation raised several issues of first impression in the Ninth Circuit.

  • Represented an Austrian mutual fund manager, Raiffeisen Capital Management, as co-lead plaintiff in class action litigation alleging that auto-parts manufacturer Delphi Corporation (Delphi) had materially overstated its revenue, net income and financial results over a five-year period. 

    Specifically, we charged that Delphi had improperly (i) treated financing transactions involving inventory as sales and disposition of inventory; (ii) treated financing transactions involving “indirect materials” as sales of these materials; and (iii) accounted for payments made to and credits received from General Motors as warranty settlements and obligations. When the fraudulent accounting practices became known, Delphi was forced to restate five years of earnings, and ultimately declared bankruptcy. We reached a $38 million settlement with Delphi’s outside auditor; in addition, the class has excellent prospects for recovery through bankruptcy litigation. 

Publications

Caught Off-Guard by Securities Lending Programs: How Supposedly Conservative Investments

Have Turned Into Unexpected Losses for Pension Funds, NAPPA Report, May 2009

Not All Foreign Plaintiffs Are Equal in U.S. Securities Class Actions, KTMC Client Update, http://www.ktmc.com/pdf/fall08.pdf

2nd Circuit’s Dynex Decision, A Sensible Approach, Law 360, August 1, 2008. http://www.law360.com/articles/64829/2nd-circuit-s-dynex-decision-a-sensible-approach?article_related_content=1

Second Circuit Affirms "Corporate Scienter" Doctrine, KTMC Client Update, http://www.ktmc.com/pdf/spring08.pdf