Panel Erred In Partially Reversing Securities Suit Dismissal, Government Argues

Mealey's (March 15, 2019, 11:04 AM EDT) -- WASHINGTON, D.C. — Although the Ninth Circuit U.S. Court of Appeals correctly held that Section 14(e) of the Securities Exchange Act of 1934 prohibits negligent misrepresentations and omissions of material fact, it erred in partially reversing a district court’s dismissal of a shareholder class action lawsuit and finding that shareholders needed to plead only negligence and not scienter, the U.S. government argues in an amicus curiae brief filed Feb. 26 in the U.S. Supreme Court (Emulex Corp., et al. v. Gary Varjabedian, et al., No. 18-459, U.S. Sup., 2019 U.S. S. Ct. Briefs LEXIS 613)....