loss causation
Nuveen Loses Bond Case Over Loss Causation
By Barry Barnett on
Do federal securities laws make your head hurt?
Sometimes they cause Blawgletter's synapses to misfire.
Take today. In Nuveen Municipal High Income Opportunity Fund v. City of Alameda, No. 11-17391 (9th Cir. Sept. 19, 2013), the ruling turned on what our securities-lawyer friends call "loss causation". Which they contrast with "transaction causation".
Stay with…
Rise After Drop in Stock Price Doesn’t Bar Damages for Securities Fraud, Second Circuit Holds
By Barry Barnett on
Say you bought a share of Enron stock before it belly-flopped into chapter 11. You paid too much for it, right? $90 or so. And when the belly-flopping took place, the market price for your share in the Greatest Company Ever fell to, oh, about $1. You lost around $89 bucks, right?
Maybe. In your…
Supreme Court Slams Fifth Circuit Test for Securities Class Actions
By Barry Barnett on
The U.S. Supreme Court today reversed a Fifth Circuit decision that required plaintiffs in federal securities cases to prove "loss causation" at the class certification stage. Erica P. John Fund v. Halliburton, Inc., No. 09-1403 (U.S. June 6, 2011).
As Blawgletter noted a couple months ago, the Fifth and Seventh Circuit had…
Hiding of Fee Rebates May Cost Citigroup
By Barry Barnett on
On Monday, the Second Circuit reversed dismissal of a securities fraud case against Smith Barney/Citigroup for misleading mutual fund investors about the true cost of "transfer agent" services, for which the mutual funds paid an outside vendor. After a few years, the transfer agent, at SmithBarneyCitigroup's request, started rebating most of the fees to SmithBarney/Citigroup. SmithBarney/Citigroup…