Executive Summary -

In private securities litigation, all eyes are on the U.S. Supreme Court hearing set for March on Halliburton Co.’s appeal challenging the longstanding fraud on-the-market doctrine, which underlies most securities litigation. Set out in 1988, the doctrine allows most securities cases to proceed as class actions so long as plaintiffs demonstrate that the market is efficient, which has usually been an easy hurdle to overcome. Now, in a case that began in 2002 and already has made one pass through the Court on other arguments, Halliburton is asking the Court to let it rebut the presumption of reliance on that efficiency by proving that misstatements did not affect its stock price. As for law enforcement, Securities and Exchange Commission Chair Mary Jo White continues to make good on promises to be more effective and aggressive. We met for an update with Jordan Eth of Morrison & Foerster; Joy A. Kruse of Lieff Cabraser Heimann & Bernstein; Matthew Larrabee of Dechert; Robert Leach of the U.S. Attorney’s Office for the Northern District of California; and Peter M. Stone of Paul Hastings. The discussion was moderated by California Lawyer and reported by Cheree Peterson of Barkley Court Reporters.

Originally published in California Lawyer on January 12, 2013.