Lee D. Rudy

The results read like a map of the destinations shareholder litigation can actually reach: a Delaware bench judgment believed to be the largest trial verdict for stockholders in history; a federal jury verdict won, defended post-trial, and affirmed on appeal; a nine-figure corporate recovery on the eve of trial; a recapitalization abandoned two days before trial rather than face him in court; and a $250 million fund for a certified class of trading investors.

Southern Peru: Two Billion Dollars for the Company

Southern Peru Copper concerned the oldest hazard in corporate law: a transaction between a public company and its controlling stockholder. Plaintiffs alleged that Grupo Mexico caused Southern Peru to buy a privately held mining company for consideration worth approximately $3 billion — an asset worth substantially less — with the controller standing on both sides of the deal. Rudy served as co-lead trial counsel in the derivative action.

Discovery ran for years and crossed borders, with depositions taken in Peru and Mexico. The trial record confronted valuation, the transaction process, controller influence, and the remedy a court of equity could craft. After a completed bench trial, the Delaware Court of Chancery found the transaction unfair and entered a judgment that, with interest, exceeded $2 billion. The Delaware Supreme Court affirmed the entire-fairness ruling and the remedy in full.

The judgment restored value to Southern Peru itself, because the overpayment had drained the company itself — stockholders benefited through the restoration of corporate value rather than individual trading-loss checks. The verdict remains a landmark of what a derivative case, tried to conclusion, can return.

Fannie and Freddie: The Verdict That Took a Decade

In August 2012, the Federal Housing Finance Agency — then running Fannie Mae and Freddie Mac as conservator — imposed the Net Worth Sweep, diverting essentially all of the companies' profits to the U.S. Treasury. Investors alleged that the sweep violated the reasonable expectations embedded in their share contracts, expectations formed when the conservatorship was announced as a temporary measure designed to return the companies to safe and solvent condition.

The case consumed more than a decade: multiple rounds of pleadings, appeals, discovery, class certification across three classes of common and junior preferred holders — and a first three-week trial in November 2022 that ended when the jury could not reach a verdict. Many trial teams never recover from a mistrial in a case of that scale. Rudy's team, which he helped lead with Eric Zagar, Grant Goodhart, and Lauren Lummus, retooled and tried it again.

The 2023 retrial ran three weeks. The team presented fact and expert witnesses for holders whose securities carried different contractual rights and different damages measures. After ten hours of deliberation, the jury unanimously found that FHFA breached the implied covenant of good faith and fair dealing and awarded $612.4 million. In March 2024, the district court added prejudgment interest for the Fannie Mae preferred class and entered final judgment of $812.05 million.

The defense of the verdict became its own campaign. In March 2025, the district court denied the defendants' post-trial challenge, ruling that "a reasonable jury could come to the verdict that was rendered here." On July 24, 2026, the D.C. Circuit affirmed the judgment in full — rejecting arguments that the implied covenant claim was unavailable, that shareholders had not proven harm, and that certain plaintiffs lacked standing. Of the many lawsuits challenging the Net Worth Sweep across the federal courts, this litigation produced the only successful cause of action. The same four lawyers who tried the case argued the appeal.

CBS and Viacom: $167.5 Million

The CBS litigation challenged the recombination of CBS and Viacom under the common control of Shari Redstone. Pension-fund plaintiffs alleged that CBS overpaid for Viacom in a process the controller influenced.

The case shows Rudy's sequencing. Kessler Topaz first pursued shareholders' books-and-records rights — and won additional internal documents after a trial on that demand alone. Those documents became the spine of a detailed fiduciary complaint, and Rudy served as co-lead counsel in the action that followed. The case survived dismissal and advanced through fact and expert discovery toward a June 2023 trial date. In April, after mediation and with discovery nearly complete, defendants and insurers agreed to pay $167.5 million in cash. The Court of Chancery approved the settlement in September 2023.

The payment went to CBS — by then Paramount Global — because the corporation was the alleged victim of the overpayment. The money returned to the entity that had been drained.

Facebook: The Trial That Never Had to Happen

Facebook proposed a new class of nonvoting stock that would have let Mark Zuckerberg sell or donate substantial economic ownership while retaining voting control — reducing his stake without surrendering commensurate power. A public pension fund challenged the reclassification in the Delaware Court of Chancery, and Rudy served as co-lead trial counsel.

The plaintiffs sought an injunction and prepared the case all the way through discovery and full trial preparation. Two days before opening statements, Facebook abandoned the reclassification entirely.

No damages fund measures that result. The withdrawal preserved the existing voting structure before the transaction could take effect, protecting the voting power attached to every public shareholder's economic ownership. Sometimes the measure of a trial lawyer is the trial the other side refuses to have.

Allergan: $250 Million for the Sellers

The Allergan litigation concerned Pershing Square's accumulation of Allergan shares before Valeant announced its tender offer. Investors alleged that Pershing and Valeant violated federal law by trading while participating in the planned offer — buying from sellers who did not know what the buyers knew. Rudy co-led the common-stock class.

The court denied dismissal motions and certified a class of investors who sold Allergan shares while Pershing was buying. After a four-day hearing on competing summary-judgment motions, the action approached trial — and settled for $250 million. A related proceeding concerning derivative instruments required its own settlement, notice, and allocation process, because the securities, purchasers, and injuries differed; the two funds maintained separate distribution rules. The common-stock fund compensated the eligible sellers themselves — the investors who, in Rudy's words, played by the rules.

Trial Practice and Education

Rudy is a partner at Kessler Topaz Meltzer & Check, focused on corporate-governance, transactional, and derivative litigation for public funds and individual shareholders. Earlier in his shareholder career he served as lead counsel in dozens of derivative actions arising from the backdating of stock options — the scandal that first put his documents-and-dates discipline to work at scale.

He graduated from the University of Pennsylvania in 1992 and Fordham University School of Law in 1996, and is admitted in New York, Pennsylvania, the Eastern District of Pennsylvania, and the United States Court of Federal Claims. His roles have included co-lead trial counsel in Southern Peru and Facebook, trial-team leadership in Fannie and Freddie, co-lead counsel in CBS, and co-lead responsibility for the Allergan common-stock class — a docket defined, from the prosecutor's office onward, by readiness to finish what he files.