Reed Smith's pursuit in New York state court of $6.75 million in fees it said it was owed for its work in a federal class action settlement amounted to a “sleight of hand” that the district court was correct to block, the U.S. Court of Appeals for the Second Circuit ruled in a per curiam order Tuesday.

U.S. District Judge Naomi Buchwald of the Southern District of New York presided in Kaplan v. S.A.C. Capital Advisors, a case filed by shareholders in 2012 against a now-defunct hedge fund management company after the discovery of an insider trading scheme that led to SAC Capital trader Mathew Martoma's conviction in Manhattan federal court, and a separate $1.2 billion penalty levied against the investment firm.

Wohl & Fruchter served as co-class counsel in the action, and sought out additional trial counsel ahead of the settlement. Reed Smith was approached in September 2016, but shortly thereafter the relationship ended after settlement negotiations began. An agreement was reached in December 2018, and Buchwald preliminarily approved attorneys fees, while calling on any other counsel that believed it was entitled to fees to notify the court.