U.S. Court of Appeals for the Eleventh Circuit

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Case Updates

Eleventh Circuit denies Chamber's motion to file

January 08, 2010

The Eleventh Circuit denied a motion by NCLC to file an amicus brief supporting review of a securities class certification decision. The court denied UBS’ petition for leave to appeal the class certification decision and accordingly denied NCLC's motion for leave to file amicus as moot.

U.S. Chamber rejects “fraud-created-the-market”, “common scheme” securities fraud theories

October 23, 2009

NCLC urged the Eleventh Circuit to review on interlocutory appeal a district court’s certification of a class action seeking hundreds of millions of dollars in damages against a public accounting firm. In this case, the plaintiffs claim that the accounting firm is liable for securities fraud because the firm made allegedly misleading audit statements, which were later incorporated into their client’s SEC registration statements. NCLC argued that the plaintiffs’ novel “fraud-created-the-market” theory - which would presume that all the investors in the class relied on the alleged fraud in purchasing the securities - conflicts with the Supreme Court’s recent decision, Stoneridge Investments v. Scientific-Atlanta, Inc. NCLC also argued that the plaintiffs’ alternative “common fraudulent scheme” theory effectively eliminates the statutory reliance requirement at the class certification stage. NCLC described the growing consensus that the expansion of securities class actions is making U.S. capital markets less attractive to both U.S. and foreign companies.

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