Nick Even in Law360: Attorneys React To High Court's Stanford Decision

02/27/2014


The U.S. Supreme Court ruled Wednesday that investors victimized by Robert Allen Stanford's $7 billion Ponzi scheme may sue Chadbourne & Parke LLP, Proskauer Rose LLP and others for allegedly aiding and abetting the fraud. Here, attorneys tell Law360 why this 7-2 ruling is significant...

Nick Even, Haynes and Boone LLP
"The Chadbourne decision resolves inconsistencies in the lower courts with respect to 'in connection with' and certainly represents a 'win' for those in the shareholder plaintiffs' bar looking to avoid the heightened federal securities pleading requirements by pursuing state law claims. While it could lead to an increase in creative state law class actions against third parties involved indirectly, peripherally or tangentially in securities transactions, its effect should be limited to cases involving so-called 'uncovered securities' not traded on a national exchange. For 'covered securities,' state law claims against third parties should remain subject to SLUSA preclusion."

Excerpted from Law360, February 27, 2014. To view full article, click here (subscription required).

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