I don’t know how many readers follow Lyle Roberts’s The 10b-5 Daily blog, but if you are not following it, you should. When Lyle posts a new item, it is always interesting. In his latest post, Lyle discusses a recent federal district court decision in which the court confronted the question whether a company’s description of a legal matter as “without merit” could be the basis of a misrepresentation claim under the federal securities laws. Because this is such an interesting question, and because companies routinely describe lawsuits to which they are subject as being “without merit,” I discuss the decision below.
Lyle’s July 25, 2023, post about the decision on The 10b-5 Daily blog can be found here. A copy of the District of Massachusetts court’s July 24, 2023, decision in City of Fort Lauderdale Police and Firefighters’ Retirement Systems v. Pegasystems, Inc. can be found here.Continue Reading Statement that Underlying Suit is “Without Merit” Held Actionable