Ninth Circuit Holds Attorney’s Statement Was “Made”, Not Attributed

Readers familiar with the Nicene Creed will instantly recognize the phrase “begotten, not made”.  I won’t wade into the theological meaning of this phrase, but I cite it as an example of the importance that can be attached to the seemingly simple concept of making.  Under Rule 10b-5, it is unlawful for “any person, directly or indirectly, .

Class A Is Class A and Class B Is Class B And Shall Ever The Twain Meet?

In addition to directors and officers, Section 16 of the Securities Exchange Act of 1934 applies to every person who is “directly or indirectly the beneficial owner of more than 10 percent of any class of any equity security (other than an exempted security) which is registered pursuant to Section 12″ of the Act.  This,

Is Certiorari A Possibility For SLUSA Question Not Addressed By Any Federal Circuit Court?

In Luther v. Countrywide Financial Corp., 195 Cal. App. 4th 789 (2011), the trial court ruled that state courts do not enjoy concurrent jurisdiction when a class action meeting the definition of a “covered class action” under the Securities Litigation Uniform Standards Act of 1998 (aka “SLUSA”) did not involve a “covered security”, as also

Do State Courts Lack Subject Matter Jurisdiction Over Covered Class Actions That Allege Only ’33 Act Claims?

In Luther v. Countrywide Financial Corp., 195 Cal. App. 4th 789 (2011), the trial court ruled that state courts do not enjoy concurrent jurisdiction when a class action meeting the definition of a “covered class action” under the Securities Litigation Uniform Standards Act of 1998 (aka “SLUSA”) did not involve a “covered security” as also defined by SLUSA

Unilateral Disarmament, The Prisoners’ Dilemma And SEC Staff Comment Letters

In an arms race, each suffers the worst result if it disarms and the other side remains armed.  However, if both sides are armed, they are not as well off as when both sides are disarmed.  This is, of course, the classic “Prisoners’ Dilemma” game (see table below). Much the same logic applies to the SEC’s insistence

Is Forced Speech In Responding To Staff Comment Letters Inaccurate Speech?

In 2014, the Securities and Exchange Commission announced that all comment letters would request that the issuer include the so-called “Tandy Letter”.  Thus, all staff comment letters include a request for a written statement in haec verba: The company is responsible for the adequacy and accuracy of the disclosure in the filing; Staff comments or

Plaintiffs Find California Courts Congenial To Section 11 Actions

Muttering About Mottoes The official motto of the State of California is “Eureka”.  Cal. Gov’t Code § 420.5.  The word is a transliteration of the Greek word εὕρηκα which is first person, singular, indicative active form of verb “find”.  Thus, it translates into “I have found it”.  The motto, which appears on the state’s seal,

Bill Aims To Negate Scienter

You can thank the Romans for science and the English for knowledge The etymon of “scienter” is sciens which is the present participle form of the Latin verb meaning to know (scire).  The English word “know” is derived from the Old English verb, cnāwan, the present participle of which is cnāwende.  The roots of cnāwan can be traced back to

Section 11 Class Actions And The Magna Carta

If you had a dispute in Medieval England, it would likely be heard in the court of the local baron.  Some disputes, however, caught the interest of the monarch and would be heard in a royal court.  In the twelfth century, King Henry II instituted royal justice throughout England.  As might be expected, controversies arose

California’s Secured Promissory Note Exemption

The line between real property transactions and securities transactions is not always clear.  California Corporations Code Section 25100(p) provides an exemption for a promissory note secured by a lien on real property provided it is neither: (a) one of a series of notes of equal priority secured by interests in the same real property; or