Sky Blog
On December 26, 2023, the Second Circuit in In re Philip Morris Int’l Inc. Securities Litigation issued a decision on two matters of first impression relating to falsity in the securities fraud context. [1] First, the court held that statements …
The Securities and Exchange Commission announced that it filed 784 total enforcement actions in fiscal year 2023, a 3 percent increase over fiscal year 2022, including 501 original, or “stand-alone,” enforcement actions, an 8 percent increase over the prior fiscal …
In a new essay, I examine public company wrongdoing by focusing on securities fraud.
In general, there are two main reasons why companies commit wrongful acts. The first is that managers have incentives to further their own interests. They may …
Existing securities laws primarily target lies. However, financial influencers, or finfluencers – people or entities with outsized influence on investor decisions through social media – need not lie in order to influence their followers. This means that finfluencers can profit …
In a recent post on the Harvard Law School Forum on Corporate Governance, three partners at Skadden, Arps, Slate, Meagher & Flom LLP give practical advice to companies in preparing for and responding to a short attack. With respect …
In the 90 years since the passage of the Securities Exchange Act, the number of ways market participants can publicly disseminate statements to investors has skyrocketed. Yet no regulator, legislator, or judge has answered a fundamental question: Should the law …
In April of last year, as described in this press release, the SEC filed a complaint against Vale S.A., a publicly traded (NYSE) Brazilian mining company and one of the world’s largest iron ore producers, charging that it made “false …
Fraud-on-the-market (“FOTM”) suits are thought to generate considerable benefits for society – namely, those associated with increased stock-market liquidity and price accuracy. But these suits are also said to impose outsized costs. The federal courts have thus long tried to …
On December 29, 2022, the Second Circuit issued its highly anticipated opinion on remand in United States v. Blaszczak (“Blaszczak II”), reconsidering the case following the Supreme Court’s January 2021 vacatur of the Second Circuit’s original decision upholding …
The Securities and Exchange Commission today [November 15] announced that it filed 760 total enforcement actions in fiscal year 2022, a 9 percent increase over the prior year. These included 462 new, or “stand alone,” enforcement actions, a 6.5 percent …
In many countries, investors can hold publicly traded companies liable for public misstatements. Issuer liability is intuitively appealing because statements are generally made on behalf of the company by its representatives. Moreover, large companies typically have deep pockets, which ensures …
As previously reported by ISS Securities
In what is still regarded as the largest U.S. corporate fraud in history, the Enron scandal “celebrates” its 20th anniversary this month.
It was October 16, 2001 when Enron announced a $638 million third quarter loss, confirming a handful of …
I think these events [the Global Investigations Review conference: New York] are an important opportunity for discussion of trends and really this area is one where your work, your advice to clients, changes the way that people behave. And it …
In March 2020, as the Coronavirus pandemic started to spread across the U.S. and wreak volatility in the stock market, securities class action complaints started to follow. Not surprisingly, U.S.-based litigation often follows wild stock market fluctuations as investors look …
Securities litigation is almost inevitable for any public company. Often, investors sue because the firm’s managers engaged in fraud that directly harmed the shareholders – say, by doctoring the firm’s financials or lying about known business prospects. However, shareholders also …
Securities fraud and short sellers are strange bedfellows. The stereotypical story involving both happens when short sellers bring to light false statements of issuers, prompting corrective disclosures and giving shareholders a cause of action. At times, issuers accuse these short …
Rule 10b-5, the federal antifraud catch-all, applies to both public and private company securities. Yet the voluminous case law, and the related scholarly literature, has focused primarily on public corporations and markets.
This state of the world sufficed for …
Notwithstanding the ongoing spread of COVID-19 and unprecedented changes in daily life and the economy, the second half of 2020 marched on to the steady drumbeat of securities-related lawsuits we have observed in recent years, including securities class and stockholder …
The lynchpin of many securities fraud cases is whether a plaintiff can establish with particularity that a defendant acted with scienter (i.e., fraudulent intent). Where the defendant is an individual person, this question may be relatively straightforward. Where the defendant …