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Director Communications And The Uneasy Relationship Between The Fiduciary Duty Of Disclosure And The Anti-Fraud Provisions Of The Federal Securities Laws, Jennifer O'Hare

Jennifer O'Hare

This Article addresses a conflict between the fiduciary duty of disclosure under state law and the anti-fraud provisions of the federal securities laws. In the Securities Litigation Uniform Standards Act of 1998, Congress balanced the federal interest of discouraging frivolous securities litigation against the need of the states to regulate the conduct of corporate directors. In the Uniform Act, Congress preempted most state securities fraud class actions, but also specifically preserved state claims based on the fiduciary duty of disclosure as enunciated by the Delaware courts at the time of enactment. At that time, the Delaware courts had limited the …