In Section 10(b) securities-fraud cases based on affirmative misrepresentations, a class action cannot be certified unless investor reliance is presumed under the fraud-on-the-market theory of Basic, Inc. v. Levinson, 485 U.S. 224 (1988). In Erica P. John Fund, Inc. v. Halliburton Co., 131 S. Ct. 2179 (2011), the Supreme Court ruled that a plaintiff does… Continue Reading
Category Archives: Securities
Subscribe to Securities RSS FeedSupreme Court Denies Review In NECA-IBEW Case
Posted in Adequacy, Class Certification, Commonality, Predominance, Securities, TypicalityWe’ve been blogging about the Second Circuit’s decision in NECA-IBEW Health & Welfare Fund v. Goldman Sachs (pdf), which held that a named plaintiff in a securities fraud suit might have standing in some situations to assert class action claims regarding securities that he or she never purchased. Yesterday, the Supreme Court denied (pdf) Goldman’s petition… Continue Reading
Securities Fraud Defendant Rebuts Fraud-on-the-Market Presumption of Reliance
Posted in Class Certification, Motions Practice, Predominance, SecuritiesWith all of the attention on last week’s Amgen decision, another interesting decision addressing the fraud-on-the-market presumption of reliance in securities fraud actions may have escaped notice. In GAMCO Investors, Inc. v. Vivendi, S.A. (S.D.N.Y. Feb. 28, 2013), Judge Scheindlin found that the defendant had rebutted the presumption of reliance as to a group of related… Continue Reading
Supreme Court Holds that Securities Fraud Plaintiffs Need Not Show Materiality at Class Certification
Posted in Class Certification, SecuritiesToday, in Amgen Inc. v. Connecticut Retirement Plans and Trust Funds, No. 11-1085, the Supreme Court held that proof of materiality is not a prerequisite for class certification in a securities fraud class action under Section 10(b), even though materiality is a predicate of the fraud-on-the-market presumption of reliance. The opinion for the majority of… Continue Reading
Plaintiffs Seek to Revive Securities Fraud Class Actions Under Second Circuit’s “Class Standing” Doctrine
Posted in Class Action Trends, SecuritiesI previously blogged about the Second Circuit’s troubling decision in NECA-IBEW Health & Welfare Fund v. Goldman Sachs & Co. (pdf), 693 F.3d 145 (2d Cir. 2012), which invented a “class standing” doctrine allowing a named plaintiff in a class action to assert Securities Act claims regarding securities that he or she never purchased. In the… Continue Reading
Cornerstone and Stanford Law School Issue Report On Securities Class Actions
Posted in Class Action Trends, SecuritiesAccording to a recent report authored by Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse, Securities Class Action Filings—2012 Year in Review (pdf), 19 percent fewer securities fraud class actions were filed in federal court in 2012 than in 2011. The 152 new class actions filed in 2012 is the second-lowest such number… Continue Reading
Are Quasi-Class Action Suits By State AGs Removable Under CAFA (Or, For Securities Fraud Cases, Barred By SLUSA)?
Posted in Antitrust, Class Action Trends, SecuritiesA number of courts recently have weighed in on a question we’ve blogged before—whether lawsuits by state attorneys general seeking restitution on behalf of private citizens are subject to removal under the Class Action Fairness Act of 2005 (pdf) (“CAFA”). These rulings have broad implications for the litigation of these quasi-class actions. They also are of… Continue Reading
Supreme Court to Decide Scope of Preemption of State-Law Securities Class Actions by SLUSA
Posted in Securities, U.S. Supreme CourtOn Friday, the Supreme Court granted review in three consolidated cases: Chadbourne & Parke LLP v. Troice, No. 12-79, Willis of Colorado v. Troice, No. 12-86, and Proskauer Rose LLP v. Troice, No. 12-88. The Court’s decision will clarify when the federal Securities Litigation Uniform Standards Act (“SLUSA”) preempts state-law securities class actions. After Congress… Continue Reading
DRI Amicus Brief Argues That Second Circuit’s Expansive View Of “Class Standing” In Securities Cases Should Be Rejected
Posted in Securities, U.S. Supreme CourtA few months ago, I posted about a Second Circuit decision that threatens to open the floodgates to securities class actions, NECA-IBEW Health & Welfare Fund v. Goldman Sachs & Co., 693 F.3d 145 (2d Cir. 2012). In that decision, the Second Circuit ruled that even though a plaintiff in an individual action may assert… Continue Reading
Supreme Court Hears Oral Argument On Whether Materiality Must Be Proven At The Class Certification Stage In Securities Class Actions
Posted in Class Certification, Securities, U.S. Supreme CourtThe Supreme Court recently heard oral argument in a case that may have a significant impact on how district courts resolve class certification fights in securities fraud cases. The issue in Amgen Inc. v. Connecticut Retirement Plans and Trust Funds is whether a class can be certified if the alleged misrepresentations constituting the fraud are… Continue Reading