Omissions

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On August 20, 2025, in a ruling that will be of particular interest to insurance industry professionals, the Third Circuit reversed vacated a trial court’s summary judgment ruling in favor of the defendants in the securities class action lawsuit pending against Bermuda reinsurer Maiden Holding, Ltd. The decision provides interesting insight into the application of the U.S. Supreme Court’s holding in the Omnicare case, with particular reference to alleged omissions in connection with insurance company loss reserves. The Third Circuit’s August 20, 2025, opinion can be found here.Continue Reading Insurer Loss Reserves and Securities Suit Omissions Allegations

Earlier this week, a plaintiff shareholder filed a securities class action lawsuit against ad-buying platform The Trade Desk after the company announced revenues lower than anticipated due to delays in the rollout of the company’s AI-based forecasting tool. As discussed below, this new lawsuit arguably represents a potential new direction in AI-related securities lawsuits. A copy of the February 19, 2025, lawsuit can be found here.Continue Reading Ad Platform Hit with Securities Suit for Alleged Failure to Disclose AI Risk

In my recent year-end wrap up, I noted that one of last year’s top stories was the rise of artificial intelligence (AI) as a source of corporate and securities litigation risk. Among the evidence reflecting the rise of AI as a source of risk was the onset of securities class action litigation containing AI-related allegations. Last week, in a new lawsuit filing showing that AI-related litigation risks are continuing, a plaintiff shareholder filed a securities suit against a Canadian technology services company whose revenues declined and whose margins shrunk as the company shifted its services to an AI-based model. A copy of the January 30, 2025, complaint against Telus International (CDA) Inc. can be found here.Continue Reading Tech Company Hit with Securities Suit Alleging AI-Related Omissions

Lawrence Fine

As discussed here, in its April 2024 decision in Macquarie Infrastructure Corp. v. Moab Partners, the U.S. Supreme Court held that a failure to disclose information required by Item 303 of Regulation S-K cannot support a private claim under Rule 10b-5 in the absence of an otherwise-misleading statement. The upshot is that so-called “pure omissions” cases are not actionable, meaning that omissions are only actionable if they make an affirmative statement materially misleading. In the following guest post, Larry Fine, Management Liability Coverage Leader for WTW, takes a closer look at the Macquarie decision and considers its implications, particularly with respect to future cases based on alleged omissions. A version of this article was previously published as a WTW client alert. I would like to thank Larry for allowing me to publish this 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 Larry’s article.Continue Reading Guest Post: The Additional Pro-Defense Benefits of the Macquarie Decision

Sarah Eichenberger
Jonathan Rotenberg

As I noted in a post at the time, last Fall, the U.S. Supreme Court in the Macquarie Infrastructure Corporation v. Moab Partners, L.P. case agreed to take up the question of whether whether the failure to make disclosure required by Item 303 of Reg. S-K is an actionable omission under Section 10(b) and Rule 10b-5. In January, the Court heard oral argument in the case. In the following guest post, Sarah Eichenberger and Jonathan Rotenberg, Partners in the Securities Litigation practice at the Katten law firm, discuss the questions the Justices as asked the oral argument and assess the possible outcomes of the case, as well as the potential significance of the outcomes. I would like to thank Sarah and Jonathan 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 site’s readers. Please contact me directly if you would like to submit a guest post. Here is Sarah and Jonathan’s article.Continue Reading Guest Post: Supreme Court Considers Whether Pure Omissions Can Support Section 10(b) Liability

In a very interesting June 16, 2021 opinion, the Ninth Circuit has reversed in part the district court’s dismissal of the privacy and cybersecurity-related securities class action lawsuit filed against Google- parent Alphabet, Inc, relating the company’s discovery of and decision not to disclose a software vulnerability that exposed user data of nearly half a million users of the Google+ social media site. The appellate court’s decision, a copy of which can be found here, could represent a significant development in the evolution of cybersecurity and privacy-related securities litigation.
Continue Reading Ninth Circuit in Part Reverses Dismissal of the Google+ User Data Securities Lawsuit

vivintWe have seen the scenario before – shortly after its debut, an IPO company releases unexpected results, the company’s share price declines, and the lawsuits appear. Usually when this happens, the updated results pertain to reporting periods following the IPO. But what about a situation where the disappointing results pertain to a reporting period that was completed prior to the IPO – in fact, the day before the IPO? That was the situation involving Vivint Solar, where the company released results for the reporting period ending September 30, 2014 – that is, just a day before the company’s October 1, 2014 IPO –several weeks after the company’s debut.
Continue Reading Second Circuit Rejects First Circuit Test Requiring IPO Company Interim Financial Information Disclosure

supreme courtThe U.S. Supreme Court has agreed to take up a case that will address a recurring issue that has arisen in the securities class action litigation arena – that is, whether or not the alleged failure to make a disclosure required by Item 303 of Reg. S-K is an actionable omission under Section 10(b) and Rule 10b-5. A circuit split has emerged on this issue, with the Second Circuit holding that Item 303 does create an actionable duty of disclosure, while the Ninth and Third Circuits have held that it does not. The Court’s grant of the writ of certiorari in the case of Leidos, Inc. v. Indiana Public Retirement System will afford the Court an opportunity to resolve the circuit split and to address the question of whether Item 303 creates an actionable disclosure duty. The U.S. Supreme Court’s March 27, 2017 order granting the writ of certiorari can be found here.
Continue Reading U.S. Supreme Court to Decide Whether Item 303 Creates Actionable Disclosure Duty

paul weiss largeIn the wake of the U.S. Supreme Court’s March 24, 2015 opinion in Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund (here), there was a great deal of speculation about what the decision’s practical impact would be and how the case would be applied in the lower courts. On March 4, 2016, the Second Circuit issued an important opinion in Tongue v. Sanofi (here) interpreting and applying Omnicare. In the following guest post, the Paul Weiss law firm take a look at the Sanofi decision and discuss Second Circuit’s narrow interpretation and application of Omnicare, and the Second Circuit’s holding that issuers need not disclose information merely because it cuts against their opinions or projections. I would like to thank the attorneys from Paul Weiss for their willingness to publish their article as a guest post on this site. I welcome guest post submissions 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 Paul Weiss attorneys’ guest post.
Continue Reading Guest Post: Second Circuit Ruling in Sanofi Narrowly Interprets Omnicare

sdnyRegular readers of this blog know that the filing of a shareholder lawsuit following the disclosure of a bribery investigation is a well-established phenomenon (as discussed, for example, here). Readers will also recall that in March 2015 when the U.S. Supreme Court issued its Omnicare decision (about which refer here), there was significant discussion whether the Court’s ruling that omitted facts could make a statement of opinion misleading and support liability under the securities laws could prove helpful to plaintiffs and even lead to more securities lawsuits premised on alleged omissions.

The trend lines for both of these issues came together in a recent dismissal motion ruling in the Southern District of New York in the securities class action lawsuit involving Och-Ziff Capital Management Group. In a February 17, 2016 opinion (here), Southern District of New York Judge J. Paul Oetken ruled that the defendants’ alleged failure to disclosure alleged but uncharged violations of the FCPA and sanctions laws was not actionable. However, he also held that the defendants’ failure to disclose the existence of the DoJ and SEC investigations was actionable, in light of the statements the company did make about its exposure to regulatory investigations. As discussed below, the Court’s conclusion that these alleged omissions were actionable was made with express reference to and reliance on the Supreme Court’s Omnicare decision.
Continue Reading Omissions Regarding Bribery Investigation Held Actionable