Recent Legal Developments in Federal Securities Litigation

This program, presented by Adam Magid of Cadwalader's Global Litigation Group, will discuss recent appellate-level decisions of interest involving private claims under the federal securities laws and their implications.

In Menora Mivtachim Insurance Ltd. v. Frutarom Industries Ltd., the Second Circuit adopted a restrictive view of the purchaser-seller rule applicable to private claims under Section 10(b) of the Securities Exchange Act, limiting standing to plaintiffs who transacted securities of the company "about which" the alleged misrepresentations were made. In Moab Partners, L.P. v. Macquarie Infrastructure Corporation, the Second Circuit confirmed that violations of SEC disclosure regulations may support Section 10(b) liability in reviving claims based on an issuer's failure to disclose the business risks posed by a United Nations harmful-emissions regulation. In York County v. HP Inc., the Ninth Circuit clarified the standards governing the Section 10(b) statute of limitations, holding that it begins to run when a "reasonably diligent plaintiff" can plead the "facts constituting the violation" so as to survive a motion to dismiss. Each decision advances the body of law governing Section 10(b) claims and offers valuable lessons for litigants and issuers.

1. Review the purchaser-seller rule, a recent application of the rule by the Second Circuit, and the unsettled state of the law governing the purchaser-seller rule outside the Second Circuit
2. Discuss how the Second Circuit has incorporated SEC disclosure regulations into its Section 10(b) jurisprudence, and the difference in the approach adopted by several other circuit courts
3. Identify the prevailing standards governing when the Section 10(b) statute of limitations begins to run, and questions that await definitive answers by the circuit courts