In the context of section 10(b) securities fraud class actions, conceptualizing corporate intent is both an unnatural and a necessary exercise. Circuit courts apply a variety of different approaches to analyze the question of corporate scienter, but they typically start with agency law and impute the intentions of corporate employees to the corporation itself.
Recognizing the fraud-deterrence purpose of these class actions suggests that...
Plaintiffs in securities class actions have increasingly relied on reports published by anonymous short sellers when alleging the element of loss causation. Indeed, short-seller reports are useful for plaintiffs, as they purport to reveal negative information about a targeted company and generally cause a decline in the targeted company’s stock price. Unlike other types of corrective disclosures, however, short-seller reports are unique in that...
This Note examines how increasing complexity fueled by financial innovations can impair mandatory disclosure as an investor-protection mechanism. It focuses on structured notes, a type of debt security that has transformed significantly since the global financial crisis. This Note highlights several financial innovations that have fueled an unprecedented increase in structured note issuance volume by expanding access and catering to more idiosyncratic...
Rule 10b-5 and the securities-fraud action provide a private enforcement tool only where litigants can show a defendant’s misrepresentation impacted the price of a security. But investors increasingly demand disclosure about how a corporation interacts with stakeholder groups such as employees, consumers, and communities. Because these “sustainability disclosures” are aimed at long-term value, misrepresentations will only...
Once it became apparent that the SEC would not impose a broker-dealer fiduciary duty to retail customers, a number of states proposed regulations that would rectify the perceived shortcomings of Regulation Best Interest (Reg BI). The new SEC rule brought into question the validity of these state fiduciary rules, as well as the common law broker-dealer fiduciary rules in other states. This Note is the first attempt to frame and resolve Reg BI’s...
As the impacts of climate change become increasingly severe and perceptible, corporations that continue to disregard the risks created by the Earth’s shifting climate stand to suffer significant financial harm. Particular sectors, such as the oil and gas industry, are especially susceptible to the effects of climate change and are already experiencing losses in value due to extreme weather events, disrupted operations, and environmental regulations....
This Article presents the legal literature’s first detailed analysis of the inner workings of Initial Coin Offerings (ICOs). We characterize the ICO as an example of financial innovation, placing it in kinship with venture capital contracting, asset securitization, and (obviously) the IPO. We also take the form seriously as an example of technological innovation, in which promoters are beginning to effectuate their promises to investors through...