Erica P. John Fund, Inc. v. Halliburton Co.
- Case Date: 3/31/2011
- Project Name: Civil Justice Reform
On June 6, 2011, the U.S. Supreme Court issued a narrow decision in a case that addressed the circumstances under which plaintiffs in a securities fraud suit are entitled to a presumption of reliance under the fraud-on-the-market theory. The Court overturned an appeals court decision holding that a plaintiff must establish loss causation (i.e., that losses came about because stock prices declined after the market discovered the falsity of previous company statements) in order to invoke the fraud-on-the-market theory. But the Court declined to reach many of the broader issues that the plaintiffs and the U.S. urged the Court to decide. The narrowness of the decision was a victory for WLF, which filed a brief urging the Court to reject the broader arguments being raised by the U.S. – in particular, an argument that defendants should be required to wait until trial to introduce evidence intended to rebut claims that the market relied on the defendants’ allegedly false statements.
More Information and Downloads:
3/31/2011: Download the Brief
Litigation Update: Court Sidesteps Most Major Issues In Narrow Securities Fraud Decision