Federal courts disagree on pleading securities fraud; circuits differ on meaning of pleadings requirement for scienter under the Private Securities Litigation Reform Act of 1995
Article Abstract:
The federal circuits disagree on the meaning of the Private Securities Litigation Reform Act of 1995's requirement for scienter, and although the text of the law tracks the 2d Circuit standard, its legislative history reflects Congress' refusal to codify that court's two-pronged elaboration of the standard. Decisions show that courts have been willing to sanction clear-cut securities fraud, but not to generalize allegations of mercenary motives that could be leveled against most corporate executives.
Publication Name: The National Law Journal
Subject: Law
ISSN: 0162-7325
Year: 1999
User Contributions:
Comment about this article or add new information about this topic:
Pleading scienter under the Private Securities Litigation Reform Act of 1995
Article Abstract:
A review of cases which have dealt with the Private Securities Litigation Reform Act of 1995's pleading requirements revealed that, overall, federal courts have applied the 'strong inference' standard consistently. It has not been clear, however, whether the act eliminated recklessness as a means of proving scienter in pleading. The scienter standard was adopted by Congress from a US Court of Appeals for the 2d Circuit case and thus is known as the 2d Circuit standard.
Publication Name: Annual Institute on Securities Regulation
Subject: Law
ISSN: 0195-5756
Year: 1998
User Contributions:
Comment about this article or add new information about this topic:
Pleading requirements and other features of the Private Securities Litigation Reform Act of 1995
Article Abstract:
The Private Securities Litigation Reform Act of 1995 changed several procedural rules for securities class actions suits. Major changes included hightening the requirements for pleading scienter and what constitutes a lead plaintiff. Details to the pleading changes brought about by the act are discussed.
Publication Name: Annual Institute on Securities Regulation
Subject: Law
ISSN: 0195-5756
Year: 1997
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: Memorandum regarding the adoption of amendments to regulation S under the Securities Act of 1993. Memorandum from Cravath, Swaine & Moore regarding sales of convertible securities of U.S. reporting companies under regulation S (August 24, 1998); re: sales of convertible securities of U.S. reporting companies under regulation S
- Abstracts: Department of Labor issues proposed regulations concerning content of summary plan descriptions including information concerning the Newborns' and Mothers' Health Protection Act of 1996. part 2