This post was written by Amy J. Greer.
In Janus Capital Group, Inc. v. First Derivative Traders, 564 U.S. ___ (2011), the United States Supreme Court reversed a decision of the United States Court of Appeals for the Fourth Circuit, largely resolving a disagreement among the lower federal courts regarding the level of involvement required to expose defendants to primary liability for a securities fraud violation. The Court held that primary liability can attach to a material misstatement or omission only if the defendant had “ultimate authority” over its making or, perhaps, if it was publicly attributed to him. As a result, primary liability is no longer a risk for professionals who only prepare or contribute information to the public statement of another, absent explicit public attribution. Professionals who work on public filings and offering documents are breathing a heavy sigh of relief today. To read more click here.