Davis Polk Discusses Ninth Circuit Approval of Securities Suit Over Unsponsored ADRs

On July 17, 2018, the Ninth Circuit issued an opinion in Automotive Industries Pension Trust Fund v. Toshiba Corp., No. 16-56058 (9th Cir. July 17, 2018), holding that the Supreme Court’s Morrison decision does not preclude purchasers of Toshiba’s unsponsored American Depository Shares or Receipts (“ADRs”) in the over-the-counter (“OTC”) market from maintaining securities claims under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 against Toshiba.  The Ninth Circuit’s decision reverses the district court’s dismissal of the securities claims under Morrison v. National Australia Bank Ltd., 561 U.S. 247 (2010).  The Ninth Circuit … Read more