Contact: Cecelia Prewett
This morning the U.S. Supreme Court issued its decision in the highly anticipated securities fraud case, Stoneridge Investment Partners v. Scientific-Atlanta, Inc. Leading up to the Court’s decision, experts speculated the case would deliver a devastating blow to victims of securities fraud by eliminating the ability of investors to hold secondary parties engaged in securities fraud accountable. In fact, the American Association for Justice (AAJ) finds the Court’s decision surprisingly much narrower than expected.
Statement from AAJ President, Kathleen Flynn Peterson
Washington, D —“AAJ is encouraged by the narrowness of the Court’s decision. The Court clearly stated that defrauded investors still have an avenue for recourse under this country’s securities laws. It was very careful to make the distinction between secondary actors involved in the financial spheres, as opposed to the goods and services industry.
We are hopeful that this means that the investors defrauded in the Enron case still have the opportunity to recover and rebuild their lives. For the thousands of families who lost their pensions and retirement savings in that debacle, we find it encouraging the Court acknowledged the securities laws do protect them. However, we are disappointed that the Court’s decision will prevent investors from holding all knowing participants in a fraud--- no matter what industry they are a part of --- for actively engaging in fraudulent schemes.”