Securities Law Commons^™

Out On A Limb: Support For A Limited Version Of Collective Scienter, Matt Mccabe

St. John's Law Review

(Excerpt)

This Note argues that the correct approach to imputing scienter to a corporation by means of the collective scienter theory is through the absurdity analysis taken by the United States Court of Appeals for the Seventh Circuit.

Broader Is Better: How Courts Should Determine Whether Or Not An Allegation Of Fraud Falls Under The Preemption Provision Of The Securities Litigation Uniform Standards Act, Jennifer Rose Roeske

St. John's Law Review

(Excerpt)

This Note argues that the correct approach for interpreting the scope of SLUSA's preemption language is the "literalist" approach taken by the Sixth Circuit. Part I of this Note lays out the legal framework of the Reform Act of 1995, Congress's intent in enacting the legislation, and the unintended consequences that flowed from the PSLRA's heightened pleading requirements. Part I also discusses SLUSA, what led to its passage, and its preemption language. Additionally, it looks at the Supreme Court's interpretation of preemption statutes generally, as well as the Supreme Court's broad interpretation of SLUSA in Merrill Lynch, Pierce, Fenner …

Is The Price Right? An Empirical Study Of Fee-Setting In Securities Class Actions, Michael A. Perino, Lynn A. Baker, Charles Silver

Faculty Publications

Every year, fee awards enable millions of people to obtain access to justice and strengthen the deterrent effect of the law by motivating lawyers to handle class actions. But little research exists on why judges award the amounts they do or whether they size fee awards correctly. The process remains a black box. Through a detailed study of 431 securities class actions that settled in federal district courts from 2007 through 2012, this Article presents the first empirical study to peer inside that black box. In contrast to prior analyses, this study relies on the actual court filings in each …

Law, Ideology, And Strategy In Judicial Decisonmaking: Evidence From Securities Fraud Actions, Michael A. Perino

Faculty Publications

Legal academics and political scientists continue to debate whether the legal, attitudinal, or strategic model best explains judicial decision making. One limitation in this debate is the high-court bias found in most studies. This article, by contrast, examines federal district court decisions, specifically interpretations of the Private Securities Litigation Reform Act of 1995. Initial interpretations of the Act articulated distinct liberal and conservative positions. The data compiled here support the hypothesis that the later emergence of an intermediate interpretation was the result of strategic statutory interpretation rather than simply judges acting consistently with their ideological preferences, although there is some …

Sec Enforcement Of Attorney Up-The-Ladder Reporting Rules: An Analysis Of Institutional Contraints, Norms, And Biases, Michael A. Perino

Faculty Publications

In their paper and in their earlier comments to the SEC on the proposed attorney reporting rules, Professors Cramton, Cohen and Koniak do an excellent job recounting the genesis of the attorney reporting requirements in the Sarbanes-Oxley Act, describing the SEC's proposed and final rules and critiquing the rule's triggering mechanism and now apparently shelved noisy withdrawal requirement. Their case study of the recent Spiegel, Inc. independent examiner's report is a particularly useful vehicle for examining the practical implications of the SEC's policy and drafting choices. Although I was a member of a committee that submitted comments opposed to noisy …

Enron's Legislative Aftermath: Some Reflections On The Deterrence Aspects Of The Sarbanes-Oxley Act Of 2002, Michael A. Perino

Faculty Publications

Since Enron's implosion, an astounding string of accounting scandals have stunned the securities markets. Global Crossing, WorldCom, Adelphia, and a host of other companies have seen plummeting share prices and SEC and criminal investigations. Congress's reaction has been equally stunning and surprisingly swift. It passed with near unanimity the Sarbanes-Oxley Act of 2002 (the "SOA" or the "Act"), and President Bush quickly signed it into law. The President billed the Act as one of the "the most far-reaching reforms of American business practices since the time of Franklin Delano Roosevelt." While the SOA is certainly lengthy, with eleven titles and …

Reviewing Article 8’S Revised Collusion Standard, Francis J. Facciolo

Faculty Publications

(Excerpt)

The first published case to deal with the new collusion standard in revised Article 8 has been decided by Judge Bransten in Supreme Court, New York County. As New York City is the center of the securities industry, it is not surprising that the first published case to deal with collusion was decided here. The result reached by Judge Bransten, however, is surprising in the liberality with which collusion was construed.

Securites Law For The Next Millennium: A Forward-Looking Statement, Michael A. Perino

Faculty Publications

This article serves as the introduction to a symposium on the future of the securities markets and securities regulation which was held as part of St. John's University School of Law's year-long 75th anniversary celebration. The introduction serves to place the symposium in an historical context to set the stage for a discussion of the future.

Legislature Mulls Change Of Article 8, Francis J. Facciolo

Faculty Publications

(Excerpt)

A major revision of Article 8 of the Uniform Commercial Code was passed by the New York Assembly on July 2, 1996, but did not receive Senate consideration prior to adjustment. In light of the strong support given Proposed Article 8 by the banking and securities industries, the New York State Legislature will probably give serious consideration to passage when the next legislative session begins.

Although the supporters of Proposed Article 8 have stoutly maintained that it is primarily a clarification of the existing Article 8 and that the proposed changes are insignificant, the proposal actually includes major changes …

The Pentium Papers: A Case Study Of Collective Institutional Investor Activism In Litigation, Joseph A. Grundfest, Michael A. Perino

Faculty Publications

This article suggests that institutional investors have rational incentives to become more active in the litigation arena, but that the current debate is falsely constrained because it rests on the assumption that institutional investors must participate either by (1) assuming the formal role of lead plaintiff, class representative, or intervenor or, (2) not participating at all. This is a false dichotomy because, as this article demonstrates, institutions have available to them a rich array of flexible, informal, and relatively inexpensive mechanisms by which they can make their views known to litigants and courts alike.

Our hypothesis that institutional investor activism …

Not Just A Private Club: Self Regulatory Organizations As State Actors When Enforcing Federal Law, Richard L. Stone, Michael A. Perino

Faculty Publications

In the Securities Exchange Act of 1934, Congress enacted a comprehensive scheme for regulating the national securities markets. Pursuant to that scheme, the Securities and Exchange Commission was given ultimate authority to enforce the newly enacted securities laws against market participants. The Exchange Act also created a prominent enforcement role for national securities exchanges, like the New York Stock Exchange. Congress required these self-regulatory organizations as a condition for their continued operation to enforce, among other things, compliance by their members with the provisions of the Exchange Act and the rules and regulations promulgated thereunder. The SROs were also given …