A federal appeals court has reversed an August 2010 decision by a Manhattan federal judge which sanctioned class action law firm Milberg LLP and its co-counsel after allegations in a lawsuit against Sony Corporation attributed to "confidential sources" were not later supported by their deposition testimony as reported by Alison Frankel for Thomson Reuters:
"We understand why the district court felt the need to impose sanctions," the decision said. "[Milberg and co-counsel] did not have evidentiary support for certain of the assertions in the second amended complaint; they took a statement attributable to a former Sony employee out of context, thereby making it misleading in terms of time, and they filed motion papers supporting the confidential source allegations even after defendants had served the Rule 11 motion." Nevertheless, the panel found, Milberg and the other firms did eventually strike the misleading statements and did not act in bad faith.
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