Merck & Co. v. Reynolds
- Case Date: 8/17/2009
- Project Name: Civil Justice Reform
On April 27, 2010, the U.S. Supreme Court ruled that the two-year limitations period within which a plaintiff may file a suit alleging securities fraud does not begin to run simply because the plaintiff knows that the defendant has issued inaccurate statements and has reason to suspect that the defendant may have intended to mislead. Rather, it begins to run only after “a reasonably diligent plaintiff” would have discovered facts indicating scienter (i.e., an intent to mislead). The decision was a setback for WLF, which filed a brief urging the Court to rule that the limitations period begins to run once the facts would lead a reasonably diligent plaintiff to begin investigating whether fraud was present. WLF argued that knowledge that a company has issued allegedly misleading statements should be enough to raise a suspicion that the misleading statements were issued with an intent to mislead and thus to place investors on “inquiry notice” of fraud.
More Information and Downloads:
8/17/2009: Download the Brief
Litigation Update: Court Adopts Relaxed Time Limits on Securities Fraud Lawsuits
Press Release: Court Urged To Set Time Limits On Securities Fraud Lawsuits