The U.S. Supreme Court today agreed to review the underpinnings of the Fifth Circuit’s 2-1 decision last week to decertify a class of Enron shareholders. In Stoneridge Investment Partners, LLS v. Scientific-Atlanta, Inc., No. 06-43 (U.S. Mar. 26, 2007) (order granting cert. here), the Court will consider whether the Eighth Circuit erred in limiting liability under section 10 of the Securities Exchange Act and Rule 10b-5 to defendants who directly misrepresented facts, omitted facts they had a duty to disclose, or engaged in manipulative buying or selling. The Fifth Circuit adopted the Eighth Circuit’s analysis and rejected the Ninth Circuit’s contrary approach.
You can see the Eighth Circuit decision here, the one from the Fifth Circuit here, and the Ninth Circuit’s here. Also check out our posts on the Enron opinion here and here.
Blawgletter notes, with a teeny dot of satisfaction, that we highlighted the possibility of Supreme Court review last Wednesday.