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So Morrison Precludes Even Domestic ADR Purchasers' Securities Suits?

So the U.S. Supreme Court held in Morrison that the investors who purchased their shares of a non-U.S. company on a foreign exchange cannot pursue claims under the Exchange Act, but securityholders who purchased American Depositary Receipts (ADRs) in the U.S. can still seek damages under the Exchange...

The New Supreme Court Term: Two Important Securities Cases

The first Monday in October marks the opening of the new Supreme Court Term each year. Last year, the High Court heard five cases which are having a significant impact in securities litigation. Jones , discussed here , reaffirmed the traditional Second Circuit standard for bringing suits under Section...

SEC Prevails on Summary Judgment

The Commission prevailed on a motion for summary judgment against the founder and chief investment officer of a registered investment company, Leila Jenkins. The complaint centered on allegations that about $1.2 billion of the $1.3 billion the fund claimed to have under management was fictitious. The...

Exchange Act § 16(B) Bars Deal Initiated by Company

Exchange Act Section 16(b) is typically applied as a "blunt instrument," according to the courts. Crafted as the only provision to specifically address insider trading at the time the Exchange Act was written in 1934, the Section precludes what are called "short swing" profits...

Supreme Court Fails to Decide Limitation Period for Section 16(b) Claims

The Supreme Court rejected the approaches of two Circuit Courts to tolling the limitation period for bringing an Exchange Act Section 16(b) claim while failing to decide if that period can be tolled. The High Court rejected the conclusion of the Ninth Circuit that the two year statute of limitations...

SEC Releases Study on the Cross-Border Scope of the Private Right of Action Under Section 10(b) of the Exchange Act

This is an update to our November 30, 2010 and April 26, 2011 blog posts relating to the SEC's Study on Extraterritorial Private Rights of Action. The study was a result of the Supreme Court's decision in Morrison v. National Australia Bank , 130 S. Ct. 2869 (2010), which abandoned nearly 50...

SEC Order Vacated For Failing To Consistently Apply Its Rule

The D.C. Circuit vacated another Commission determination last week. Again, the order was not based on the merits. Again, it was based on the failure of the agency to comply with procedural requirement. Earlier this year the Circuit Court vacated the Commission's proxy access Rule because the...

The Impact of the New Commission Cooperation Initiatives – Part II

The SEC's new cooperation tools have impacted a number of actions. In four cases, as discussed in Part I of this article, the Commission entered into agreements under which it either chose to prosecute or deferred prosecution with a view toward dismissal. In most instances where the agency has acknowledged...