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Eric K. Gerard

Partner

D   484-654-2884
F   610-667-7056

Eric K. Gerard, a partner of the Firm, is a former federal prosecutor and experienced trial lawyer whose practice focuses on securities fraud, consumer class actions, and qui tam litigation. He received his law degree from the University of Virginia School of Law, earning Order of the Coif honors while completing a master’s degree in international economics at the Johns Hopkins University.

Before joining Kessler Topaz, Eric worked as an Assistant District Attorney at the Manhattan District Attorney’s Office, as a litigator at an international law firm, and as an Assistant U.S. Attorney. At the Justice Department, Eric served in the white-collar and major crimes sections of the Criminal Division and in the affirmative civil enforcement (ACE) section responsible for investigating fraud against the United States. He has tried a range of complex cases to verdict, including international money laundering, wire fraud, securities counterfeiting, identity theft, obstruction of justice, civil healthcare liability claims, and murder-for-hire.

Memberships

  • American Association of Justice 
  • American Constitution Society 
  • Taxpayers Against Fraud

Speaking Engagements

  • “Case Study in International Money Laundering,” Financial Crimes and Inspectors General Council (2018)
  • “Emerging Trends in Securities Enforcement,” Hillsborough County Bar Association (2017)
  • “Effective Opening Statements,” Goldberg Inn of Court (2017)
  • “Address on Behalf of the New Inductees,” Texas Board of Law Examiners (2014)
  • “Prosecuting Opportunistic Hate Crimes,” Anti-Defamation League, New England Region (2007)

Awards/Rankings

  • Top Complex Financial Crimes Investigation, Inspectors General Council (2018)
  • Outstanding Legal Article Award, Houston Bar Foundation (2017)
  • Rising Star, Super Lawyers Magazine (2016)
  • Houston’s Top Lawyers, Houstonia Magazine (2016)
  • Top Scorer, Texas Bar Exam (2014)
  • Order of the Coif, Virginia Chapter (2009)
  • National Finalist, National Trial Competition (2008)

Experience

Ongoing Cases

  • CASE CAPTION In re Advance Auto Parts, Inc. Securities Litigation
    COURT United States District Court for the District of Delaware
    CASE NUMBER 18-cv-00212-RGA
    JUDGE Honorable Richard G. Andrews
    PLAINTIFF Public Employees’ Retirement System of Mississippi (“MPERS”)
    DEFENDANTS Advance Auto Parts, Inc., Thomas R. Greco, and Thomas Okray
    CLASS PERIOD November 14, 2016 through August 15, 2017, inclusive

    This securities fraud class action case arises out of Defendants’ misrepresentations about their financial forecasts and guidance for fiscal year 2017. As alleged, prior to the Class Period, Defendant Advance Auto Parts struggled with lagging comparable store sales and operating margins. Under a new CEO and CFO (Defendants Thomas Greco and Thomas Okray, respectively), the Company announced an ambitious, optimistic transformation and told the market that it would achieve positive sales and margins in 2017—despite all internal projections continuing to point negative. During the Class Period, Defendants chose to double down and reaffirm their false guidance when presented with opportunities to modify it. When they finally admitted publicly that their promised success would never come to fruition, Defendants caused the Company’s stock price to plummet.

    MPERS filed a 95-page Amended Complaint in January 2019 on behalf of a putative class of investors alleging that the Defendants violated Section 10(b) of the Securities and Exchange Act by making false and misleading statements about the Company’s fiscal year 2017 financial forecasts. In February 2020, Judge Andrews denied the vast majority of Defendants’ motion to dismiss. In November 2020, Judge Andrews certified the class. Defendants sought interlocutory review of the class certification order, but the 3d Circuit Court of Appeals denied review.  Fact discovery is complete, with expert disclosures underway.  The case is set for trial on April 4, 2022.

  • CASE CAPTION      Industriens Pensionsforsikring A/S v. Becton, Dickinson and Company, et al.
    COURT United States District Court for the District of New Jersey
    CASE NUMBER 2:20-cv-02155-SRC-CLW
    JUDGE Honorable Stanley R. Chesler and Honorable Cathy L. Waldor
    PLAINTIFF Industriens Pensionsforsikring A/S (“Industriens”)
    DEFENDANTS Becton, Dickinson and Company, Vincent A. Forlenza, Thomas E. Polen, and Christopher R. Reidy
    CLASS PERIOD November 5, 2019 through February 5, 2020, inclusive

    This securities fraud class action arises out of Becton’s alleged misrepresentations concerning its ability to market one of its key products—the Alaris infusion pump system (“Alaris”)—in 2020.

    For years, Alaris has been an important revenue driver for Becton, accounting for hundreds of millions of dollars in annual sales, and the cornerstone product of its main Becton Medical segment. Beginning in November 2019, Defendants stopped shipping Alaris, explaining to investors that the pause related to mere software “upgrades,” would quickly resolve, and would simply push Alaris sales into the final three quarters of Becton’s fiscal 2020, allowing for strong Company-wide 2020 earnings growth. In reality, however, the problems with Alaris were much more severe than Defendants let on, as the product had been beset with undisclosed defects, safety and compliance issues, and unremediated regulatory failures for months, and in some cases, years, prior to late 2019. When Defendants revealed the full sweep of these issues in February 2020, and the fact that Alaris would be pulled from the market for an indefinite number of months—causing earnings guidance for 2020 to be slashed—Becton’s stock price dropped over $33.00 in a single day of trading.

    Industriens filed an amended complaint in February 2021 on behalf of a putative class of investors alleging that Becton and former executive Forlenza, as well as current executives Polen and Reidy, violated Section 10(b) of the Securities Exchange Act by making false and misleading statements about Alaris and the issues the product faced. As alleged, Defendants downplayed and outright misrepresented the severe safety and regulatory problems Becton knew troubled the Alaris product line, and assured investors that Becton was on track to meet its earnings guidance for 2020, anchored by Alaris revenues, through a series of false or misleading statements. Meanwhile, Forlenza and Polen enriched themselves by together selling over $58 million worth of their personally-held shares of Becton stock between November 2019 and February 2020. The February 2020 revelation of the truth about the Alaris issues led directly to the sharp decline in Becton’s stock price noted above, causing significant losses and injury to the Company’s investors.

    On September 15, 2021, the Court granted Defendants’ motion to dismiss, but granted Plaintiff leave to amend the amended complaint.  On October 29 2021, Plaintiff filed a second amended complaint.

  • CASE CAPTION          Sjunde AP-Fonden v. The Goldman Sachs Group, Inc. et al.
    COURT United States District Court for the Southern District of New York
    CASE NUMBER 1:18-cv-12084-VSB
    JUDGE Honorable Vernon S. Broderick
    PLAINTIFF Sjunde AP-Fonden (“AP7”)
    DEFENDANTS The Goldman Sachs Group (“Goldman Sachs” or the “Company”), Lloyd C. Blankfein, Gary D. Cohn, and Harvey M. Schwartz
    CLASS PERIOD February 28, 2014 to December 20, 2018, inclusive

    This securities fraud class action case arises out of Goldman Sachs’ role in the 1Malaysia Development Berhad (“1MDB”) money laundering scandal, one of the largest financial frauds in recent memory.

    In 2012 and 2013, Goldman served as the underwriter for 1MDB, the Malaysia state investment fund masterminded by financier Jho Low, in connection with three state-guaranteed bond offerings that raised over $6.5 billion. Goldman netted $600 million in fees for the three bond offerings—over 100 times the customary fee for comparable deals.

    In concert with Goldman, Low and other conspirators including government officials from Malaysia, Saudi Arabia, and the United Arab Emirates ran an expansive bribery ring, siphoning $4.5 billion from the bond deals that Goldman peddled as investments for Malaysian state energy projects. In actuality, the deals were shell transactions used to facilitate the historic money laundering scheme. Nearly $700 million of the diverted funds ended up in the private bank account of Najib Razak, Malaysia’s now-disgraced prime minister who was convicted for abuse of power in 2020. Other funds were funneled to Low and his associates and were used to buy luxury real estate in New York and Paris, super yachts, and even help finance the 2013 film “The Wolf of Wall Street.”

    AP7 filed a 200-page complaint in October 2019 on behalf of a putative class of investors alleging that Goldman and its former executives, including former CEO Lloyd Blankfein and former President Gary Cohn, violated Section 10(b) of the Securities Exchange Act by making false and misleading statements about Goldman’s role in the 1MDB fraud. As alleged, when media reports began to surface about the collapse of 1MDB, Goldman denied any involvement in the criminal scheme. Simultaneously, Goldman misrepresented its risk controls and continued to falsely tout the robustness of its compliance measures. Following a series of revelations about investigations into allegations of money laundering and corruption at 1MDB, Goldman’s stock price fell precipitously, causing significant losses and damages to the Company’s investors.

    In October 2020, the U.S. Department of Justice announced that Goldman’s Malaysia subsidiary had pled guilty to violating the Foreign Corrupt Practices Act (“FCPA”) which criminalizes the payment of bribes to foreign officials, and that Goldman had agreed to pay $2.9 billion pursuant to a deferred prosecution agreement. This amount includes the largest ever penalty under the FCPA.

    On June 28, 2021, The Honorable Vernon S. Broderick of the U.S. District Court for the Southern District of New York sustained Plaintiffs’ complaint in a 44-page published opinion. The case is now in discovery.

  • CASE CAPTION       The Electrical Welfare Trust Fund, The Operating Engineers Trust Fund of Washington, D.C., and The Stone & Marble Masons of Metropolitan Washington, D.C. Health and Welfare Fund v. United States of America
    COURT United States Court of Federal Claims
    CASE NUMBER 19-cv-00353-EMR
    JUDGE Eleni M. Roumel
    PLAINTIFF The Electrical Welfare Trust Fund, The Operating Engineers Trust Fund of Washington, D.C., and The Stone & Marble Masons of Metropolitan Washington, D.C. Health and Welfare Fund
    DEFENDANTS United States of America
    CLASS PERIOD N/A

    Plaintiffs filed an action in the United States Court of Federal Claims to recover monies illegally assessed and collected from Plaintiffs through the United States government’s unlawful interpretation and application of Section 1341 of the Patient Protection and Affordable Care Act of 2010, codified in 42 U.S.C. § 18061 (the “Act” or “ACA”). As part of the Act’s implementation, the Transitional Reinsurance Program was created and includes a Transitional Reinsurance Contribution (the “Contribution”) imposed on certain “contributing entities.” The Contribution serves to fund reinsurance payments to health insurance issuers that insure high risk individuals as new enrollees. Those entities deemed “contributing entities” were required to pay the Contribution to the federal government during the transition period, including benefit years 2014 through 2016. On July 30, 2021, the Court denied Defendant’s motion to dismiss, finding that self-administered, self-insured multiemployer plans were not properly considered contributing entities and leaving the case open for discovery on behalf of a class of self-insured multiemployer employee health and welfare benefit plans as to whether Defendant’s imposition of the Contribution on Plaintiffs violates the Due Process and/or Takings Clauses of the Fifth Amendment to the U.S. Constitution. An amended complaint was filed on September 14, 2021 and the case is now proceeding through discovery.

  • CASE CAPTION  Washtenaw County Employees' Retirement System v Walgreen Co., et al.
    COURT United States District Court for the Northern District of Illinois
    CASE NUMBER 1:15-cv-03187
    JUDGE Honorable Sharon Johnson Coleman
    PLAINTIFF Industriens Pensionsforsikring A/S (“Industriens”)
    DEFENDANTS Walgreen Co. (“Walgreen” or the “Company”), Gregory D. Wasson, and Wade Miquelon
    CLASS PERIOD March 25, 2014 through August 5, 2014, inclusive

    This securities fraud class action case arises out of Defendants’ representations and omissions regarding Walgreen’s highly publicized earnings target of $9 billion to $9.5 billion for fiscal year 2016 (the “FY16 target”) and the negative impact of hyperinflation in generic drug prices (“generic inflation”) combined with unfavorable reimbursement contracts that caused significant reductions in Walgreen’s gross margins and earnings. During the Class Period, Defendants repeatedly reaffirmed the FY16 target and represented that Walgreen was seeing “nothing unusual” with respect to generic inflation or reimbursement pressure. Plaintiff alleges that unbeknownst to investors, the systemic shift to generic inflation caused a catastrophic impact on Walgreen’s earnings and profitability because it was “locked up” in multi-year contracts with lower reimbursement rates that did not protect against generic inflation.

    Industriens filed a 124-page complaint in August 2015 on behalf of a proposed class of investors alleging that Walgreen and its former executives, CEO Greg Wasson and CFO Wade Miquelon, violated Section 10(b) of the Securities Exchange Act by making false and misleading statements and concealing material facts about the magnitude and severity of generic inflation and reimbursement pressure and the combined impact on Walgreens’ margins and profitability, including the FY16 target. As alleged, following Walgreens’ disclosure of a $2 billion shortfall to its FY16 EBIT target as a direct result of generic inflation and reimbursement pressure, Walgreens’s stock price fell precipitously, causing significant losses and damages to the Company’s investors.

    In September 2016, the Honorable Sharon Johnson Coleman issued an order denying in part Defendants’ motion to dismiss. In March 2018, Judge Coleman certified the case as a class action. Following Industriens’s amendment of the complaint in December 2018, Judge Coleman issued an order in September 2019 denying in part Defendants’ renewed motion to dismiss. The order held that Plaintiff’s amended complaint adequately alleged several additional false and misleading statements and omissions, including statements regarding the FY16 target and the negative impact of generic inflation and reimbursement pressure on the Company’s performance.

    On November 2, 2021, the Court issued a Memorandum and Opinion and Order denying in large part Defendants’ motion for summary judgment, clearing the case to proceed to trial.

Publications

The Health Lawyer (ABA), “Supreme Dilemma: Handling Conflicts Between State Medical Privacy Laws and Federal Investigative Subpoenas” (Aug. 2019)

Regulatory Compliance Watch, “Lessons in Due Diligence Seen in Case of Jailed Fraudster” (Dec. 2018) (quoted)

Texas Lawyer, “Timely Disclosure Requirements of Texas’s Responsible Third-Party Statute” (Nov. 2015)

Houston Lawyer, “Joint Venturing the Case” (July/Aug. 2015)

Texas Bar Journal, “Called to the Bar” (July 2014)

Developments in Mental Health Law, “Waiting in the Wings: Assessing the Admissibility of Neuroimagery Evidence for Lie Detection” (2008)