Client Alert

Supreme Court Establishes New National Standard For Pleading Securities Fraud Cases

June 27, 2007

Howard M. Privette, William F. Sullivan, Peter M. Stone, and Kimberly A. Donohue

On June 21, 2007, the Supreme Court ruled that a plaintiff filing a federal securities fraud complaint must do more than plead facts sufficient to support a reasonable inference that each defendant acted with scienter, or wrongful intent. In Tellabs v. Makor Issues & Rights, Ltd., No. 06-484 (June 21, 2007), an 8-1 majority of the Court resolved a split among the Circuit Courts over the interpretation of the governing statute, which mandates that a plaintiffs complaint must support a strong inference of scienter in order to survive a motion to dismiss.

Click here for a PDF of the full text

Get In Touch With Us

Contact Us