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: Northwest Business Litigation BlogU.S. Supreme Court declines to expand securities fraud liability
By Lori Bauman
In the latest in a string of rulings favoring business interests, the U.S. Supreme Court held today that parties who did not directly mislead investors cannot be liable for securities fraud under SEC Rule 10b-5. By a 5-3 vote, the court refused to recognize the concept of "scheme liability" as to third parties who participate in a fraudulent scheme but do not themselves issue a false statement.
See Justice Anthony Kennedy's opinion in Stoneridge Investment Partners v. Scientific-Atlanta here. And see earlier discussion of the case in the Oregon Business Litigation Blog here.
Full post as published by Northwest Business Litigation Blog on January 16, 2008 (boomark / email).
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