NEW YORK--(BUSINESS WIRE)--Earlier today, the U.S. Supreme Court issued a unanimous 9-0 decision upholding the right of investors to bring class actions under the federal Securities Act of 1933 in state courts, and rejecting the arguments of the U.S. Chamber of Commerce and other corporate interest groups that such actions can be brought only in federal courts. Scott+Scott, on behalf of a group of the firm’s pension fund clients, co-authored an amicus curiae brief in support of the pro-investor position. The decision, Cyan, Inc. v. Beaver County Empl. Retirement Fund, is available on the Supreme Court’s website at https://www.supremecourt.gov/opinions/17pdf/15-1439_8njq.pdf.
David R. Scott, managing partner of Scott+Scott, described the decision as an “important victory” for investors. As Scott explained: “In recent years, corporate defendants have been increasingly aggressive in trying to secure the ‘right’ to choose the forum that, for whatever reason, they believe will be most advantageous for them. However, as the Supreme Court confirmed today, state courts are just as competent as federal courts to hear cases under the Securities Act – and the law gives plaintiff investors (rather than corporate defendants) the right to choose whether to sue in state or federal court under that Act.” Mr. Scott added that many state courts have special complex litigation “sections,” experienced commercial judges, expedited procedures, smaller caseloads and/or more favorable juror pools, which can all be important considerations in deciding where to sue a corporation. Scott+Scott has extensive experience litigating Securities Act cases in both state and federal courts across the country.
The “Institutional Investors” amicus brief, filed jointly by Scott+Scott and two other law firms, analyzed the legislative history and purposes of the Securities Act of 1933, the Securities Exchange Act of 1934, the Private Securities Litigation Reform Act of 1995 (the “PSLRA”), and key provisions of the Securities Litigation Uniform Standards Act of 1998 (“SLUSA”). As the Supreme Court noted, the corporate defendant (Cyan) “stake[d] much of its case on legislative purpose and history.” But the Supreme Court effectively adopted the investor amici’s analysis on these points, and stated that Cyan’s contrary arguments came “nowhere close” to justifying a ruling for the defendants. Cyan, slip opinion, at 12.
About Scott+Scott Attorneys at Law LLP
Scott+Scott has significant experience in prosecuting major securities, antitrust, and employee retirement plan actions throughout the United States. The firm represents pension funds, foundations, individuals, and other entities worldwide with offices in New York, London, Connecticut, California, and Ohio.