• Private Securities Fraud Claims Under Section 10(b) Based on False or Misleading Statements: U.S. Supreme Court Holds that Private Actions May Be Brought Only Against Parties With Ultimate Authority Over the Content and Issuance of the Alleged Misstatements
  • June 17, 2011
  • Law Firm: Sullivan Cromwell LLP - New York Office
  • In recent years, the U.S. Supreme Court has interpreted the judicially created private right of action for securities fraud under Section 10(b) of the Securities Exchange Act of 1934 to impose liability only on “primary” violators who were actually responsible for making the alleged misstatements in question. In Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164 (1994), and Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., 552 U.S. 148 (2008), the Supreme Court rejected private securities fraud lawsuits that relied on theories of “aiding and abetting” and “scheme liability,” because the defendants did not “make” the alleged misstatements.