Craig W. Smith has played a central role in many of the firm’s significant successes on behalf of shareholders and public corporations in derivative and securities actions. His clients include individuals and institutional investors with holdings in the banking, finance and investment, biotechnology, construction, defense, for-profit education, information technology, leisure, consumer goods, and pharmaceutical industries. Mr. Smith also serves as Robbins LLP’s General Counsel. Mr. Smith has been recognized by his peers as a San Diego Super Lawyer for six consecutive years.
Before joining Robbins LLP, Mr. Smith served for four years as division and regional counsel for UBS Financial Services, Inc., where he advised management regarding securities litigation, financial regulation, compliance and risk management. He spent the first decade of his career at O’Melveny & Myers LLP, where he defended Fortune 500 companies and professional services firms in securities fraud class actions, shareholder derivative litigation, and SEC investigations and enforcement actions, as well as professional malpractice and business tort matters. He served for five years on O’Melveny’s firm-wide Pro Bono Committee.
Mr. Smith earned his Juris Doctorate from the Yale Law School, where he externed for the U.S. Attorney’s Office in New Haven, Connecticut. Mr. Smith earned his Bachelor of Arts in Political Science from the University of California, Berkeley, where he was awarded Highest Honors in Political Science, Highest Distinction in the College of Letters and Science, and was granted early initiation into Phi Beta Kapa in his junior year.
Robbins LLP served as lead counsel in shareholder derivative litigation brought on behalf of Fifth Street Finance Corp., challenging conflicts of interest in Fifth Street’s relationship with its investment advisor, FSAM. Plaintiffs alleged that certain Fifth Street and FSAM officers and directors caused Fifth Street to make reckless investments, use bogus accounting, and pay excessive fees to inflate FSAM’s perceived value in the lead up to FSAM’s initial public offering. Mr. Smith led the settlement negotiations that resulted in advisory fee reductions worth $30 million and comprehensive corporate governance, oversight, and conflicts management enhancements. In re Fifth Street Finance Corp. Shareholder Derivative Litigation, Lead Case No. 3:15-cv-01795-RNC (D. Conn. Dec. 13, 2016).
Mr. Smith and his team played a leading role in shareholder derivative litigation brought on behalf of Avon Products, Inc., against officers and directors alleged to have turned a blind eye to bribes made in violation of the Foreign Corrupt Practices Act to secure the first foreign direct sales license in China. Mr. Smith led the negotiations that resulted in Avon’s agreement to adopt a comprehensive corporate governance and compliance reform program, which The Wall Street Journal praised as “a victory for shareholders looking for accountability from the business.” Pritika v. Jung, No. 651479/2015 (N.Y. Sup. Ct. May 1, 2015).
Mr. Smith played a leading role in shareholder derivative litigation brought on behalf of Career Education Corporation against officers and directors alleged to have caused its for-profit schools to falsify job placement and student loan repayment rates and to fail to meet accreditation standards, jeopardizing access to the Title IV federal student loan funds that account for the lion’s share of its revenues. Mr. Smith and his co-counsel in Alex v. McCullough, No. 1:12-cv-08834 (N.D. Ill. Dec. 5, 2012); Bangari v. Lesnik, No. 1:11-CH-41973 (Ill. Cir. Ct.-Cook Cty. Dec. 11, 2011); and Cook v. McCullough, No. 1:11-cv-09119 (N.D. Ill. Dec. 22, 2011), negotiated a global settlement that secured a $20 million recovery for Career Education, as well as comprehensive board and management-level governance and oversight reforms.
Mr. Smith negotiated a comprehensive package of enhancements to internal controls over accounting and financial reporting and board oversight of enterprise risk and stock repurchases to address allegations that massive undisclosed risk-taking and manipulative stock repurchases in violation of Section 10(b) of the Securities Exchange Act of 1934 caused the company to suffer catastrophic losses in the 2007-2010 financial crisis, and payment of over $26 million to settle the related securities class action. Professor Jeffry N. Gordon of the New York University Law School opined that “the Reforms meaningfully reduce the risk of recurrence of such a shareholder catastrophe and thus create economic value many multiples greater than the requested attorneys’ fees.” Rubery v. Caplan, et al., No. 1:07-cv-08612 (S.D.N.Y. Oct. 3, 2013).
Mr. Smith led the firm’s efforts in shareholder derivative litigation brought to address allegations that certain officers and directors of the company published misleading product development and introduction projections and caused the company to repurchase stock at artificially inflated prices in violation of Section 10(b) of the Securities Exchange Act of 1934. After the company authorized payment of $200 million to settle related securities fraud claims, Mr. Smith negotiated comprehensive financial reporting, risk management, stock repurchases, and board oversight reforms designed to prevent recurrence of these harms and restore investor confidence. In re Motorola, Inc. Derivative Litigation, Lead Case No. 07CH23297 (Ill. Cir. Ct-Cook Cty. Nov. 29, 2012).
Mr. Smith spearheaded the litigation and settlements in a number of shareholder derivative actions brought on behalf of biotechnology companies, including Geron Corporation, MannKind Corporation, and CTI BioPharma (f.k.a. Cell Therapeutics), that led to their adoption of state-of-the-art clinical trial and disclosure oversight and internal controls programs, following costly mismanagement of clinical trials and publication of misleading disclosures. Oriente v. Scarlett et al., No. CVV528121 (Cal. Super. Ct.-San Mateo Cty. April 21, 2014); In re MannKind Corp. Derivative Litigation, No. 1:11-cv-05003-GAF-SSx (C.D. Ca. June 13, 2011); In re Cell Therapeutics, Inc., Derivative Litigation, No. 2:10-cv-00564-MJP (W.D. Wash.-Seattle Apr. 1, 2010).
Mr. Smith and his team’s litigation efforts prompted Heckmann Corporation’s Board of Directors to create a Special Litigation Committee to evaluate legal claims arising from the company’s disastrous acquisition of a China-based water company. Mr. Smith persuaded the Committee to adopt reforms designed to enhance transaction due diligence, disclose practices, and robust investigation of acquisition targets’ internal controls over accounting and financial reporting. Hess v. Heckmann et al., No. INC 10010407 (Cal. Super. Ct.-Riverside Cty. Nov. 18, 2010).
Mr. Smith played a key role in persuading the Special Litigation Committee formed by Brocade’s Board to prosecute stock option backdating claims against former officers and directors. In re Brocade Communication Systems, Inc., Derivative Litigation, No. 1:05-cv-041683 (Cal. Super. Ct.-Santa Clara Cty. Jan. 28, 2010). Mr. Smith was part of the four-lawyer team that met with the Committee and convinced it to retain the firm as co-counsel and to pursue the claims. Brocade recovered tens of millions of dollars and extinguished its obligation to fund the criminal defense of its former CEO.
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