In numerous prior posts, I have noted the problems and inefficiencies that the U.S. Supreme Court’s March 2018 Cyan decision have wrought, such as, for example, the possibility of multiplied parallel litigation (discussed here). There are a host of other issues as well, such as the absence in state court of procedural protections available in federal court; the prevalence in state court of weaker suits; and the pressure that multiple suits puts on defendants to settle, as discussed here. These and other concerns arising from Cyan have led the U.S. Chamber of Commerce’s Institute for Legal Reform (ILR) to issue a new paper entitled “Courting Confusion: Federal Securities Class Actions Don’t Belong in State Courts,” in which the ILR calls for Congress to “close the loophole” by requiring that all 1933 Act claims must be brought in federal court and authorizing the removal to federal court of ’33 Act liability actions filed in state court. The ILR’s August 30, 2021 press release, to which the paper is attached, can be found here.
Continue Reading Institute for Legal Reform: Congress Should Enact Reforms to Address Cyan