• The Janus Appeal: Supreme Court to Address Secondary Actor Liability Again
  • November 17, 2010 | Author: Eric S. Waxman
  • Law Firm: Skadden, Arps, Slate, Meagher & Flom LLP - Los Angeles Office
  • Next month, the U.S. Supreme Court will take up key questions regarding secondary actor liability in Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525, following its prior decisions in Central Bank of Denver v. First Interstate Bank of Denver, 511 U.S. 164 (1994) and Stoneridge Investment Partners v. Scientific-Atlanta, 552 U.S. 148 (2008). In Central Bank, the Supreme Court eliminated aiding and abetting liability in private lawsuits under Section 10(b) of the Securities Exchange Act of 1934 for secondary actors, holding that a secondary actor only may be liable under 10(b) if all of the elements of primary liability are satisfied. See Central Bank of Denver, 511 U.S. at 191. Notwithstanding Central Bank's holding, plaintiffs have since argued that Central Bank left unanswered how to determine when a secondary actor satisfies the elements of primary liability under 10(b).