A&O Shearman files amicus brief for Washington Legal Foundation urging Supreme Court review of a split over application of the Basic presumption

The brief argues that the Third Circuit erred in affirming class certification by holding that republication of old news can cause a stock drop sufficient for invocation of the Basic presumption in cases based on an “inflation maintenance” price impact theory. 

The brief contends that the Supreme Court should review the decision to eliminate deepening confusion over application of the Basic presumption at the class certification stage in securities fraud class actions. Further, the brief notes that without clarification, the Third Circuit’s ruling could inject confusion into related loss causation and class-period determinations and weaken guardrails against abusive securities class action litigation erected by Congress and the Court.

Read the full amicus brief here.

The WLF is a nonprofit public-interest law firm and policy center with supporters in the U.S. Founded in 1977, WLF promotes and defends free enterprise, individual rights, limited government, and the rule of law.