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Supreme Court to Securities Issuers: Beware What You Omit When Stating Your Opinions

Deciding this Term’s big securities case, a unanimous Supreme Court held on March 24 that a statement of opinion does not become actionable under the “untrue statement of material fact” clause of section 11 of the Securities...more

Sixth Circuit Warns Boards Not to Blow Off Notice of Shareholder Proposals

A recent Sixth Circuit decision indicates that company boards should proceed cautiously in providing notice of shareholder meetings, particularly where a dissident shareholder is expected to offer a resolution. ...more

U.S. Supreme Court’s Omnicare Decision Leaves Open Narrowed Theory Of Liability For Statements Of Opinion Under Federal Securities...

Can a public company violate the federal securities laws simply by expressing an opinion that turns out to be wrong? In 2013, the U.S. Court of Appeals for the Sixth Circuit startled the business community by recognizing just...more

The Supreme Court's Omnicare Decision: Implications And Remaining Questions Regarding When Opinions Are Actionable Under The...

On March 24, 2015, the Supreme Court issued its much anticipated decision in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund, No. 13-435, 2015 WL 1291916 (Mar. 24, 2015). With some significant...more

Context, Reasons, Hedges, and Disclaimers: The Supreme Court’s Ruling in Omnicare May Shape Whether and How Companies Express...

The Supreme Court’s decision yesterday in Omnicare Inc. v. The Laborers District Council Construction Industry Pension Fund, No. 13-435 (U.S. March 23, 2015) articulated the standard of liability for statements of opinion. At...more

Omnicare Decision Clarifies Grounds for Section 11 Liability

The Supreme Court holds that section 11 liability does not attach to a statement of opinion merely because the opinion is objectively false. On March 24, the US Supreme Court issued its highly anticipated decision in...more

Supreme Court’s Omnicare Decision Follows Middle Path Advocated by Lane Powell and WLF

In the opinion issued yesterday in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund (“Omnicare”), the Supreme Court rejected the two extremes advocated by the parties regarding how the truth or...more

Supreme Court Holds That Issuers Can Be Liable for Omitting Material Facts From Statements of Opinion in Omnicare Case

In its opinion in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund, released yesterday, the U.S. Supreme Court held that a securities issuer’s statement of opinion in a registration statement,...more

Supreme Court Decides Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund

On March 24, 2015, the U.S. Supreme Court held that a pure statement of opinion in a securities registration statement is not an “untrue statement of a material fact” under Section 11 of the Securities Act of 1933 just...more

Blog: SCOTUS Decides Omnicare: 6th Circuit Applied Incorrect Standards In The Context Of Liability Under §11 For Statements Of...

Today, SCOTUS issued its opinion in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund. In the case, SCOTUS answers these questions: First, when can a statement of opinion be considered a “false...more

Priorities For the SEC’s Enforcement Division

Last week SEC Enforcement Division Director Andrew Ceresney,testified before Congress regarding the efforts of the Division and its requested for additional funding, highlighting its priorities....more

Delaware Supreme Court Leaves Open The Question Of Whether Breach Of Contract Is A Business Judgment

In this interesting order affirming a Chancery decision, the Supreme Court went out of its way to make a point. A stockholder suit alleging that the board breached a stock option plan may state a claim for breach of contract...more

Dechert Survey of Securities Fraud Class Actions Brought Against U.S. Life Sciences Companies

Publicly Traded Life Sciences Companies in the United States Are an Increasingly Popular Target of Securities Fraud Class Action Lawsuits - The past year was particularly noteworthy with respect to the relative number...more

SEC Awards $500K to Company Officer Whistleblower

On Monday, March 2, the Securities and Exchange Commission (SEC) announced that it will award between $475,000 and $575,000 to a corporate officer who reported “high quality, original information” about a securities fraud....more

Omissions Regarding “Known Trends” in a 10-Q Report May Support a Securities Fraud Claim

If a public company fails to disclose in its quarterly or annual reports trends and uncertainties that it could reasonably expect to have a material impact on revenues, at least one significant federal court has held that the...more

Orrick's Financial Industry Week in Review

SEC Proposes Rules for Disclosure of Hedging Policies - On February 9, the SEC issued proposed rules that are intended to enhance disclosure of company hedging policies for directors and employees, as mandated by...more

Delaware Independent Director Liability in Control Buyout Cases

The Delaware Supreme Court will address the standard for pleading that an independent director has breached fiduciary duties in connection with a controlling shareholder buyout. The issue was certified for interlocutory...more

SEC "Claws Back" Bonuses and Stock Sale Profits From CFOs of Public Company Charged With Accounting Fraud

On February 10, 2015, the SEC announced settlements with two former chief financial officers of Saba Software, a Silicon Valley software company, that require the CFOs to repay Saba more than $500,000 in bonuses and profits...more

Three New Weapons to Combat Shareholder Litigation

Over the past several years there has been an overwhelming abundance of class action shareholder litigation. A study by Cornerstone Research found that in 2013 alone, 94% of mergers and acquisitions worth over $100 million...more

Cambridge Ret. Sys. v. Bosnjak, C.A. No. 9178-CB (Del. Ch. June 26, 2014) (Bouchard, C.)

In this memorandum opinion, the Court of Chancery granted in part and denied in part the defendants’ motion to dismiss for failure to make a pre-suit demand on the board and for failure to state a claim, holding that demand...more

Delaware Court of Chancery Rules That a Major Debt Holder and 48 Percent Stockholder Is a Controlling Stockholder and Owes...

In Hamilton Partners, L.P. v. Highland Capital Management, L.P., the Delaware Court of Chancery denied a motion to dismiss breach of fiduciary duty claims brought by former stockholders of American Home Patient, Inc. (AHP)...more

Hushmail: Are Activist Hedge Funds Breaking Bad?

Increasingly, some activist hedge funds are looking to sell their stock positions back to target companies. How should the board respond to hushmail? The Rise and Fall of Greenmail - During the heyday of...more

Fair Valuation and Mutual Fund Directors: History of Enforcement Actions Against Independent Directors

At the ICI 2014 Mutual Funds and Investment Management Conference, the staff of the Division of Investment Management announced that it would not propose comprehensive guidance on valuation of investment company portfolios...more

Does the Business Judgment Rule Protect Bank Officers and Directors?

When a corporation suffers significant losses, or ultimately fails, frustrated shareholders, creditors, or others often try to sue the corporation and/or its officers and directors for losses caused by mismanagement of the...more

Paradigm Shift? The Delaware Supreme Court Allows Bylaw That Shifts Attorneys’ Fees to Loser in Fiduciary Duty Litigation

Under the prevailing “American rule,” shareholders and their counsel face little financial risk when they assert claims against directors and officers for breaches of fiduciary duty, typically following the announcement of a...more

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