FOR IMMEDIATE RELEASE – January 15, 2008                       Contact: Robin Conrad
                         
Supreme Court Stoneridge Decision Reaffirms Existing Law

WASHINGTON, D.C.—The United States Chamber of Commerce and the National Chamber Litigation Center (NCLC) today applauded the Supreme Court’s decision to halt the expansion of securities liability cases in Stoneridge Investment Partners v. Scientific-Atlanta, Inc.  NCLC filed an amicus brief in August warning against expanding securities liability in cases brought by private parties to include a theory called “scheme liability.”
 
“The high costs of frivolous litigation in the U.S. are driving public companies to list in Europe and elsewhere putting future investments in our markets at risk,” said Tom Donohue, Chamber president and CEO. “This decision, coupled with last year’s indictment of some of America’s biggest class action trial lawyers for large-scale fraud and corruption charges, is a positive step for investors and all those concerned about America’s competitive disadvantage in the global marketplace.”
 
In a brief filed in August, NCLC explains that “scheme liability” places pressure on businesses to incorporate the cost of yet more litigation risk into every transaction and provides yet another reason for foreign companies to refuse to list on American exchanges or to do business with American companies.
 
“This decision will benefit everyone who participates in the market by limiting frivolous lawsuits, which drive stock prices down,” stated Robin Conrad, executive vice president of the NCLC. “Third-parties who did not mislead investors, but entered into business partnerships with those who did, should not be subject to private securities fraud actions.  As the Court noted today, Congress has placed enforcement authority in a federal regulatory agency, the SEC, to punish aiders and abettors of fraud.”
 
NCLC, the public policy law firm of the U.S. Chamber of Commerce, is a membership organization that advocates fair treatment of business in the courts and before regulatory agencies. The U.S. Chamber of Commerce is the world's largest business federation representing more than 3 million businesses and organizations of every size, sector, and region.

NCLC

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