Norton Rose Fulbright US LLP
Related services and key industries
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Frank Taylor is a partner in the Minneapolis office. Frank has more than 40 years of experience in complex financial markets litigation, class actions, regulatory investigations, enforcement proceedings and market conduct examinations. He has defended clients in some of the financial services industry's most significant cases. To date, he has served as lead trial counsel in more than 135 class actions and has tried more than 350 matters to verdict, judgment or award in 42 states before federal, state and arbitration forums. Frank focuses his practice on counselling and representation of firms in various financial markets; complex litigation and arbitration in the financial markets; alternative dispute resolution; class action defense; regulatory investigations, enforcement proceedings and market conduct examinations; antitrust; and complex business disputes.
Frank is widely respected among major financial, investment and insurance companies throughout the United States. He has solid experience representing firms and individuals in enforcement proceedings brought by regulatory, self-regulatory and various state bodies; judicial actions brought by state attorneys general; and legislative actions. His clients include manufacturers of insurance products and annuities, registrants, fund managers, registered investment advisors, broker/dealers, futures commission merchants (FCMs), hedge funds, issuers of collateralized mortgage obligations (CMOs), and manufacturers and issuers of financial instruments.
Frank has extensive experience defending claims against manufacturers of annuities and life insurance. These matters include the successful defense, upheld on appeal, of a putative class action involving the use of shadow insurance, the successful defense of a putative class action challenging the use of home equity to purchase equity-indexed variable annuities, successful defense of putative class actions involving the sales of annuities to suspect classes and the successful representation of insurance product manufacturers, broker-dealers, and other financial institutions and their representatives in attendant state and multi-state investigations.
Frank has handled many complex financial services litigations. These include: class actions involving shadow insurance, use of home equity proceeds to purchase equity indexed annuities, sales of annuities and insurance contracts to suspect classes, class actions defending registrants or underwriters in price drop, cooked book and misrepresentation of transactions disputes, cases of first impression in arbitrability of disputes, short swing profit disputes under Section 16, breach of contract claims in purchasing company shares, hedge fund and direct investment issues, sales by unregistered individuals, suitability issues related to the sale of insurance products, breakdown or lack of compliance controls within a firm, theft by officers, insider trading, front-running, Ponzi schemes, and ERISA actions.
Consequently, he has been influential in a number of "firsts" in this area, including assisting in the creation of the first derivatives program and the first investment advisory program offered by a Wall Street firm. He later successfully defended both firms in the first class actions and enforcement proceedings related to these programs. Frank was also the lead in the first roll-up of limited partnership interests into a master limited partnership, and the first registration of the conversion of limited partnership interests into publicly traded common stock.
Frank is regularly called upon to advise companies with respect to insider trading matters, insider-trading policies, the disposition of surplus funds held as paid-in capital, suspected violations of conflict of interest policies and other internal investigations.
JD, with distinction, University of Iowa College of Law, 1977
BA, with distinction, with honors, Phi Beta Kappa, University of Iowa, 1974
At the University of Iowa College of Law, Frank served as editor for the Iowa Law Review. He is also a former adjunct professor for William Mitchell College of Law.
Frank is admitted to practice in Minnesota, Iowa, Nebraska, and New York. He is also admitted to the following courts: U.S. District Court District of Arizona, U.S. District Court District of Minnesota, U.S. District Court District of New York, U.S. District Court District of Colorado, U.S. District Court District of Iowa, U.S. District Court District of Nebraska, U.S. District Court Southern District of New York, U.S. Court of Appeals 6th Circuit, U.S. Court of Appeals 8th Circuit, U.S. Court of Appeals 10th Circuit, U.S. Court of Appeals 11th Circuit, U.S. Court of Federal Claims, U.S. Tax Court, Minnesota Supreme Court and U.S. Supreme Court.
- Iowa State Bar
- Minnesota State Bar
- Nebraska State Bar
- New York State Bar
- Obtained an Order of Dismissal, with prejudice, from the Western District of Missouri on a Fed.R.Civ.P. 12(b)(6) Motion that the McCarren-Ferguson Act barred RICO claims that an insurance manufacturer using "shadow insurance" improperly priced its annuities and other contracts. The Eighth Circuit affirmed.
- Successfully resolved RICO class actions in the Middle District of California and the Superior Court for Los Angeles County, California in which the class representative alleged that the manufacturer and its agents improperly "taught" customers to "strip" equity from their homes to purchase equity indexed annuities. The federal action was dismissed on Fed.R.Civ.P. 12(b)(6) Motion, and the case was subsequently resolved in state court. The resolution class consisted of approximately 33,000 members.
- Successfully defended a class action brought in California state court by a 74-year-old blind man who mortgaged his home to purchase a deferred annuity. This was a "stalking case" that was resolved in such a manner as to preclude additional cases, particularly class actions.
- Successfully resolved in the Middle District of California a RICO class action of 88,000 members involving the sales of annuities to suspect classes of individuals without proper disclosure of, among other things, surrender charges. The Class Plaintiff also alleged that the annuities were improperly "priced."
- Managed opt-out litigation from a class settlement involving alleged vanishing premiums. There were approximately 35,000 opt-out claims.
- Obtained dismissal, with prejudice, on statute of limitations grounds claims that an insurance company committed fraud and violated others laws by churning annuities. The Tenth Circuit affirmed the dismissal.
- Lead trial counsel in the successful dismissal and settlements of actions brought in Mississippi federal and state courts involving alleged forgery by an insurance company's agent to obtain insurance proceeds.
- Successful prosecution of alleged agent misconduct through an illegal premium financing scheme, resulting in the recovery of ill-gotten gains. The matter also involved the successful representation of the manufacturer in nearly fifty state regulatory and criminal investigations.
- Successful defense of a class action brought against a manufacturer by agents who alleged that the manufacturer improperly "clawed back" some $60 million in commissions and bonuses. The matter was resolved without any payment by the manufacturer in settlement.
- Successful defense of an action brought by an employer who improperly used annuities to fund retirement plans in violation of Section 419 of the Tax Code and ERISA, allegedly based upon the advice of the manufacturer.
- Successfully resolved class actions involving the selling of viaticals, including follow-on Ponzi scheme cases. These were the largest class actions in the viatical space.
- Lead trial counsel in the successful defense of 14 claims tried in arbitration involving the sale of bogus promissory notes and viaticals in a Ponzi scheme. Here, we obtained the first Respondent award in any case brought by the leading firm in "selling away" actions.
- Successful representation of the target of the largest multi-state market conduct examination brought to date. Monetary sanctions were de minimus and led to, among other things, adoption of ORSA, enhanced compliance and supervisory functions including dashboard systems.
- Successfully defended several actions brought by a state attorney general against annuity manufacturers alleging that the sale of deferred annuities to seniors and other suspect classes was deceptive, violated consumer protection statues and the sales were not suitable. We used surveys to obtain excellent sales data that was instrumental in rebutting the state's allegations and ultimately resolving the matters.
- Led investigation into the alleged misconduct of senior leaders of a financial institution's third party distribution arm who created sham corporations to convert fees and commissions owed the insurance company for their own use. Achieved client's objectives through dismissal of the individuals from employment and successful prosecution of civil litigation.
- Participated in the liquidation of the then largest failure of a manufacturer of an annuity manufacturer, Baldwin United.
- Successful representation in class actions of the largest underwriter of third party sales of Baldwin United annuities.
- Representation of the principals of Executive Risk in various federal and state investigations into the use of insurance as part of leveraged buyout transactions.
- Several successful appearances before the New York Department of Insurance.
- Successful representation before various state insurance commissioners.
- Negotiated and drafted agreements for a private equity firm to manage an insurance company's portfolio even after the private equity firm sold the insurance company.
- Successful resolution of several coverage disputes.
- Negotiated and drafted agreements with third party broker-dealer to market, sell and settle securities and insurance products.
- Participation in the DOL Rule and Rule 151 challenges.
- Lead trial and liaison counsel for the Investment Banker Defendants in the largest securities case tried to a jury. Obtained the only summary judgment for a defendant and settled the remainder of the claims after six weeks of trial for mid-six figures. The verdicts exceeded $2.5 billion. Principal was also a "target" of the FBI investigation and no charges were brought.
- Successful representation of a broker-dealer of securities who underwrote the sale of $2.2 billion of interests in public and private oil and gas limited partnerships that returned $4 million of the investments. Total resolution cost was under $30 million, with no sanctions. Forty-nine class actions and numerous individual "stalking horse" actions were filed around the country. Many state and federal regulatory and self-regulatory investigations were brought. All were successfully defended with no sanctions or penalties levied against the firm, its executives or registered representatives..
- Successfully defended actions brought against the second largest wholesaler of interests in Petro-Lewis Corporation and its limited partnership interests. When adjusted for the time value of money, Petro-Lewis is viewed as the fourth largest securities case brought in the United States and the largest Ponzi scheme.
- Successful representation of a broker-dealer that underwrote the sale of US$250 million of tax credit financed low income securities issued by Citi-Equities Group in what turned out to be a Ponzi scheme. The perpetrator of the scheme was convicted on forty-five counts of mail and wire fraud and sentenced to 293 months in federal prison under the Kingpin Statute. The broker-dealer was the target of a class action, numerous arbitrations and several regulatory investigations. Total cost of resolution was less than US$2 million and no sanctions were imposed. This is the largest credit litigation in the United States.
- Representation of various entities involved in WorldCom.
- Successful white collar representation of a target in the one of the largest Department of Justice RICO actions for alleged state sales tax violations. The United States alleged that failure to pay state sales taxes constituted mail and wire fraud under RICO. One target was convicted, sentenced to two years in federal prison and ordered to pay US$6 million in fines. Our client was not prosecuted. The defense was predicated upon a Consent Decree with the Department of Justice involving the licensing of the Xerographic process.
- Lead trial counsel that successfully prosecuted a RICO claim against a customer that "bounced" $48 million in checks to cover a margin call and then arranged a worthless financing scheme to "cover" the loss.
- Successful representation of holders of Capital Credits in the country's largest agricultural cooperative in which the Colorado federal court defined capital credits as securities and the members of the class received full redemption value of the Capital Credits and all costs and attorneys' fees.
- Dismissal on Rule 12(b)(6) Motion of an action brought under Section 16(b) of the Exchange Act for alleged improper short swing profits. Donoghue v. Patterson Cos., 990 F. Supp. 2d 421 (S.D.N.Y. 2013).
- Lead trial counsel to the registrant in the first Eighth Circuit decision interpreting the scope of Section 16(b). Successfully defended the claim, obtaining summary judgment from the trial court after appeal.
- As lead trial counsel, obtained the dismissal, on Fed.R.Civ.P. 12(b)(6) Motions, of many putative securities class actions brought under the Exchange Act, ERISA and state law because of the precipitous drop in the price of a registrant's common stock.
- Successfully defended a putative class action brought in connection with the acquisition of a publicly traded company by private equity.
- Obtained dismissals of two class actions – one on Motion, the other on a disclosure only basis – brought because of allegedly poor valuation of the acquisitions of bank holding companies by other bank holding companies.
- Lead trial counsel in the successful representation of a publicly traded company in 17 class actions brought in four jurisdictions.
- Numerous work in MDL actions.
- Successful representation of a broker-dealer of securities that underwrote the sale of interests in private oil and gas partnerships that were largely worthless.
- Lead trial counsel in the successful defense of a class action securities claim brought against a publicly traded company, its principals and its largest shareholder, which was an Indian pharmaceutical company.
- Resolved 30 customer complaints in arbitration, three state securities investigations, led by the Commonwealth of Virginia, and an SEC investigation relating to the loss of US$100 million in accounts managed without the grant of discretion by the customers to a registered representative who improperly held himself out as an affiliate of an RIA. No sanctions were levied and the total case resolution cost was less than 1.2 percent of actual losses.
- Settlement of a FINRA investigation into record keeping violations by one of the largest independent contractor broker-dealers. FINRA had threatened severe sanctions, including expulsion. This is one of the largest settlements with FINRA.
- Successful defense of a suitability claim brought against large financial institution and its broker-dealer by the minor children and incapacitated adults of a Native American Indian Tribe against a global financial services organization. Award was well within tolerance limits.
- Representation of a broker-dealer that obtained a judgment against a wealthy Saudi arms dealer for losses suffered in a margined options trading account and who did not satisfy the judgment. The arms dealer sued the broker-dealer in Saudi Shia court arguing that options trading was gambling and prohibited by Sharia law. The Saudi court agreed and entered judgment against the broker-dealer and the branch office manager and assistant branch office manager. The matter was successfully resolved in the US courts.
- Lead trial and regulatory counsel to a broker-dealer whose registered representative functioned as an unlicensed investment advisor in the management of a $60 million portfolio.
- After hearing, obtained award for a broker-dealer accused of failure to supervise a registered representative who took discretion of the account of an octogenarian suffering from dementia who had losses well into the eight figures.
- Resolution for a large broker-dealer of problems associated with senior leader who posted disparaging information about a publicly traded competitor on a message board, while taking short position through naked options in the competitors' publicly traded common stock.
- Obtained substantial award for a broker-dealer against a customer who incurred large losses in options trading.
- Successful resolution for a broker-dealer of disputes in the Pacific Northwest in which over US$100 million was lost through a seminar marketing scheme.
- Lead trial counsel for a large financial institution and its captive broker-dealer in the successful defense of a class action, bankruptcy clawback proceedings and 250 arbitrations brought in Michigan arising out of a massive Ponzi scheme involving the Ed May Deals.
- Led the first roll up of private limited partnerships into a publicly traded master limited partnership as a way to work out litigation.
- Led the roll up of publicly traded equity securities and privately held limited partnerships into one publicly traded entity.
- Obtained a significant award in raiding case that Registered Representative magazine described, at the time, as the largest and most wide-ranging awards rendered in such a case. Dumpster diving was used to obtain the critical evidence.
- Successful defenses of raiding claims.
- Counsel for a promoter of one of the largest commodities fraud actions brought in the United States. Civil and criminal actions were dismissed.
- Successful workout of the failure of a large Embassy Suites franchise chain financed through Section 103(b) of the Internal Revenue Code. The workout was pre-litigation and neither litigation nor bankruptcy was filed.
- Successful workout of failed holdings by the largest developer of commercial office buildings in the Upper Midwest. The workout was pre-litigation and neither litigation nor bankruptcy was filed..
- Obtained summary judgment in the last antitrust case brought to final judgment in the District of Minnesota, which was affirmed on appeal to the Eighth Circuit.
- Trial counsel in an action brought to quiet title in the name of the exploratory partner in a joint venture to explore and develop uranium reserves in Texas. Although US$1 billion jury verdict was rendered in the trial court, the price of uranium dropped during appeal, resulting in the payment of US$500 million to our client by the "successful" plaintiff. Our client appealed verdict, the other side did not, which created the verdict arbitrage opportunity.
- Special state's attorney to counties in connection with property valuation.
- Successful trial results in property valuation.
- Trial counsel in condemnation and land use actions.
- Trial counsel in the condemnation of property in which the condemnee received the largest jury verdict in Nebraska.
- Represented farmers and ranchers who were allegedly denied due process in the issuance of an order by a state agency denying them the exercise of their water rights to irrigate their crops and water their livestock.
- Successful representation of a minority shareholder in the break-up of the country's largest purebred Angus cattle company.
- Workout of agriculture loans for financial institutions during the agricultural crisis of the 1980's.
- Global representation of large financial institution in connection with disaster planning for the Y2K potential crisis.
- Counsel to the CEO of an automobile dealership chain in connection with the CEO's acquisition of interests in the dealerships.
- Litigation Star, Benchmark Litigation
- Chambers USA
- Minnesota Super Lawyers
- Who's Who in America
- Leading American Attorney
- Martindale-Hubbell, Preeminent Rating
- North Star Lawyer, Minnesota State Bar Association
- The Best Lawyers in America, Best Lawyers, 2021
Frank has authored numerous articles related to the financial services industry including:
- Co-author, "Is the next big Ponzi scheme around the corner? And are firms at a higher risk for selling away activities?" Norton Rose Fulbright Legal Update, May 11, 2020
- Co-author, "COVID-19: Emerging strong on the other side of the pandemic," Norton Rose Fulbright Legal Update, March 27, 2020
- "Variable Annuities and Other Insurance Products," NSCP National Membership Meeting, September 1, 2015
- Co-author, "The $225,000 laptop: losing confidential customer data will cost you," Lexology, September 1, 2015
- "Are Financial Instruments Issued by Cooperatives Securities? A Framework Analysis," Drake Journal of Agricultural Law, Vol. 5, No. 1
- "Minnesota adopts NAIC model rules on suitability of annuity transactions, to be effective June 1, 2013," Lexology, May 23, 2013
- "Variable Annuities and Other Insurance Products," NSCP National
- "The Issuance of Securities by Small and Growing Businesses: A Primer," William Mitchell Law Review; Vol. 22, No. 4
- "Hedge Funds: Current Issues," NSCP National Membership Meeting, 2010
- "FINRA enforcement appeals hearing panel decision regarding class-action waiver provisions," Lexology, May 29, 2009
- "Avoiding Litigation and Managing Publicity for Compliance Officers," NSCP National Membership Meeting, 2009
Frank is a frequent lecturer for continuing legal education programs.
- Association of Corporate Counsel presents "A Call to Action: Inclusion in the Workplace Starts with You," Minneapolis, MN, January 31, 2020
- Annual Upper Midwest Securities Litigation and Enforcement Forum, April 2017
- Co- presenter, "Due Diligence in a Post-DOL World" at Financial Services Institute One Voice 2017, San Francisco, CA, January 23, 2017
- Annual Upper Midwest Securities Litigation and Enforcement Forum Presentation on the Department of Labor Fiduciary Duty Rule, January 2017
- Presentation on the Department of Labor Fiduciary Duty Rule, October 2015
- "Variable Annuities and Other Insurance Products," NSCP National Membership Meeting, September 1, 2015
- Securities Industry and Financial Markets Association, 1986-Present
- Member, Compliance and Legal Division
- Association of Life Insurance Counsel, Member
- Association of the Bar of the City of New York, Member
- Nebraska State Bar Association, Member
- New York State Bar Association, Member
- American Bar Association, Member
- Association of Trial Lawyers of America, Member
- New York State Trial Lawyers Association, Member
- Federal Bar Council, Member
- Various state and federal courts
- The Sanneh Foundation, Chair
- Youth Soccer Team, Manager
- North Star Lawyer
Publication | May 29, 2020
Is the next big Ponzi scheme around the corner? And are firms at a higher risk for selling away activities?
Publication | May 11, 2020
Publication | March 27, 2020