In its June 21, 2021 decision in Goldman Sachs Group, Inc. v. Arkansas Teacher Retirement System (discussed here), the U.S. Supreme Court provided important guidance regarding price impact evidence at the class certification stage of securities class action litigation. In the following guest post, Nessim Mezrahi, Stephen Sigrist, and Carolina Doherty discuss class certification implications of price impact in securities class actions pursuant to the Goldman Sachs decision. Mezrahi is cofounder and CEO, Sigrist is VP of data science, and Doherty is VP of business development at SAR. A version of this article previously was published in Law360. I would like to thank the authors for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.

Continue Reading Guest Post: Q2 Stock Drop Stats Buoy High Court’s Goldman Ruling

When the U.S. Supreme Court granted the petition for a writ of certiorari to take up class certification questions raised in the long-running Goldman Sachs securities class action lawsuit, some commentators thought the case might give the Court the opportunity to reconsider fundamental issues about the presumption of reliance under the “fraud on the market” theory in connection with class certification in securities suits. However, as the case has turned out, the Court’s consideration of the case has not produced any fundamental recasting of any key issues; instead, the Court on June 21, 2021 issued a narrow decision that the majority opinion itself acknowledged, with respect to the most significant substantive part of the Court’s opinion, will not be “outcome determinative” in many cases. The Court’s June 21, 2021 decision can be found here.
Continue Reading Supreme Court Vacates Class Certification in Goldman Sachs Securities Suit on Narrow Grounds

Nessim Mezrahi
Stephen Sigrist

In the following guest post, Nessim Mezrahi and Stephen Sigrist discuss their analysis of Rule 10b-5 private securities fraud litigation in 2019 and 2020 against U.S. Issuers, and the impact of recent guidance by the 2nd and 7th Circuits on Halliburton II stock price impact defenses at the class certification stage.  Mezrahi is cofounder and CEO and Sigrist is a data scientist at SAR.  SAR’s January 8, 2021 press release discussing a more detailed 4Q 2020 securities class action analysis can be found here. A version of this article previously was published on Law360. I would like to thank Nessim and Stephen for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ article.
Continue Reading Guest Post: Halliburton II Price Impact Defenses Can Limit Severity on Deficient Exchange Act Claims

In the same December 11, 2020 Order in which it rejected the bid by the Texas Attorney General to overturn the results of the 2020 Presidential election, the U.S. Supreme Court also agreed to take up a case involving the effort of Goldman Sachs to overturn the certification of a class in the long-running securities lawsuit. The case relates to the bank’s alleged conflicts of interest in structuring collateralized debt obligation securities before the global financial crisis. The case will require the Court to address important questions pertaining to the ability of securities lawsuit defendants opposing class certification to attempt to rebut the presumption of reliance and the extent to which the defendants in opposing class certification can rely on matter that is also relevant to merits-related issues such as materiality.
Continue Reading U.S. Supreme Court Agrees to Take Up Securities Suit Class Certification Issues

Tim Hoeffner
Paul Ferrillo

The Second Circuit issued its latest decision in the long running Goldman Sachs Group securities class action litigation on April 7, 2020 (here). In the following guest post, Tim Hoeffner and Paul Ferrillo of the McDermott, Will & Emery law firm take a look at the Second Circuit’s decision and analyze its implications. I would like to thank Tim and Paul for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Time and Paul’s article.
Continue Reading Guest Post: Close Call in New Second Circuit Class Certification Decision

Tiago Duarte-Silva
Assen Koev

In order to obtain class certification, the 10b-5 action plaintiff must show that the defendant company’s shares trade in an efficient market. In order for a court to determine whether the company’s shares trade in an efficient market, it must consider the five “Cammer factors,” of which one is whether the company has a sufficient number of analysts following its stock. In the following guest post,  Tiago Duarte-Silva, Vice President, Charles River Associates, and Assen Koev, Principal, Charles River Associates, take a look at this Cammer analyst factor and what it may tell us about 10b-5 actions. A version of this article previously was published by Charles River Associates as a newsletter. I would like to thank Tiago and Assen for allowing me to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this blog’s readers. Please contact me directly if you would like to submit a guest post. Here is Tiago’s and Assen’s article.
Continue Reading Guest Post: The Cammer Analyst Factor in Securities Class Actions

As I have detailed in prior posts on this blog, securities class action litigation is well-established in Australia. According to a recent report from ISS Securities Class Action Services, securities class action litigation has grown “markedly” in the last ten years, to the point that outside North America, Australia “is the jurisdiction in which a corporation is most likely to find itself defending against a class action,” and indeed other than the U.S., Australia “is pulling ahead of almost all other countries in terms of active securities class action cases before the courts.” There are however important differences between the Australian and U.S. class action systems, and some of these difference post important challenges for both the courts and for litigants – and indeed have led to calls for reform. The October 23, 2018 report, entitled “Navigating the Australian Securities Class Action Landscape,” can be found here.
Continue Reading The Challenging Securities Litigation Landscape in Australia

In the following guest post, attorneys from the Paul Weiss law firm take a look at the Second Circuit’s January 12, 2018 decision in Arkansas Teacher Retirement System v. Goldman Sachs Group, Inc. (here), in which the appellate court vacated the district court’s certification of a shareholder class in the securities class action lawsuit arising out of the investment company’s involvement in the creation and marketing of the infamous “built-to-fail” Abacus CDO. A version of this article previously appeared as a Paul Weiss law firm client memo. I would like to thank the authors for their willingness to publish their article as a guest post on this site. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is the authors’ guest post.
Continue Reading Guest Post: Second Circuit Holds Defendants’ Fraud-on-the-Market Presumption Rebuttal Need Not Be Conclusive

I have had this perception for several years now that the U.S. Supreme Court recently has been particularly keen to take up securities cases. It turns out that this perception has a basis in objective fact. A recent paper by University of Toledo law school Professor Eric Chafee confirms that since John Roberts became Chief Justice in 2005, the Court has averaged two securities opinions per court term, twice the number of the prior Rehnquist Court. Indeed, as the number of cases overall on which the Court has granted cert has continued to shrink, the securities cases have become an increasingly significant component of the Court’s docket. The current term is no exception; the Court began the term with three securities cases on its docket (although a recent settlement in one of the cases reduced the number to two).

The Court is showing its securities law proclivities once again. On Friday, December 8, 2017, the Court granted cert in yet another securities law case. The Court’s December 8, 2017 Order granting the petition for a writ of certiorari in China Agritech Inc. v. Resh can be found here. As Professor Chafee notes in his recent paper, many of the securities cases the Roberts court has taken up in recent years have involved issues “at the periphery of securities laws.” The new case the Court has taken up arguably is no exception to this generalization. The China Agritech case is in fact the second case the Court has taken up in successive terms involving statute of limitations tolling issues under the Court’s American Pipe tolling doctrine.
Continue Reading U.S. Supreme Court Grants Cert in Yet Another Case Securities Law Case

A recurring issue in securities cases involves the question of when plaintiffs may rely on the presumption of reliance under the fraud on the market doctrine. To invoke the presumption plaintiffs must show that the defendant company’s securities trade on an efficient market, which in turn raises the question of what the plaintiffs must show in order to demonstrate market efficiency. In the following guest post, attorneys from the Paul Weiss law firm review a recent Second Circuit decision on this issue, Waggoner v. Barclays PLC (here). I would like to thank the attorneys from the Paul Weiss law firm for allowing me to publish this article as a guest post. I welcome guest post submissions from responsible authors on topics of interest to this site’s readers. Please contact me directly if you would like to submit a guest post. Here is the Paul Weiss attorneys’ guest post.
Continue Reading Guest Post: Second Circuit: Price Impact Evidence Not Always Necessary to Establish Market Efficiency