Securities class Action Damages - Private Securities Litigation Reform Act Reporter
Eaton & Van Winkle Partner Lawrence Steckman’s recent article on securities class action damages titled “Loss Causation, Economic Loss Rules and Offset Defenses – Dismissal Motion Practice After Acticon A.G. v. China N.E. Petroleum Holdings Ltd.,” has been published by the Private Securities Litigation Reform Act Reporter, Vol. 37, No. 5 at 53, (August, 2014).
The article discusses the Second Circuit’s rejection of the theory underlying dismissal of several class cases, i.e., that where the price of securities which are the subject of a rule 10b-5 securities fraud litigation bounce back to pre-fraud levels shortly after decline, no damages have occurred. The Second Circuit held that because the reason for the post-corrective disclosure recovery cannot be properly adjudicated on a dismissal motion, Rule 12 dismissal in the district court was improper.