Say you write a press release. It says your firm just won a beauty contest. It claims you expect the contract to increase the firm's net income by X percent.

But your note to the fourth estate doesn't mention that the deal will raise firm costs by an Awful Lot. So much in fact that you expect to lose money!

Someone then somehow buys shares in your firm, at a price that reflects the false hope, which the press release promotes, of rising profits. And then, when your firm's annual report reveals a big drop in net income and the share price plummets as a result, the buyer sues under Rule 10b-5 and section 10(b) of the Securities Exchange Act of 1934.

Did you "make" the false statement about the profits you never thought the firm would get? No, the 5-4 Supreme Court held yesterday in Janus Capital Group, Inc. v. First Derivative Traders, No. 09-525 (U.S. June 13, 2011). Your firm did, but you didn't — because you lacked "ultimate authority" over what the press release said.

Justice Clarence Thomas penned the majority opinion, which Chief Justice Roberts and Justices Alito, Kennedy, and Scalia joined; Justice Breyer dissented, as did Justices Ginsburg, Kagan, and Sotomayor.

Editors of the WSJ praised the outcome. A less bright-line standard "could implicate the innocent", they wrote.

Blawgletter notes the pregnant "could". It implies that the tough test the majority chose could exonerate the guilty. It also suggests, ever so slightly, that a truly innocent person doesn't include someone who smuggled the false statements into a public disclosure over whose content someone else had "ultimate authority". And yet that person goes free under the Court's ruling.