The Aftermath of Morrison v. National Australia Bank and Elliott Associates v. Porsche

23 Pages Posted: 22 Feb 2011 Last revised: 17 Aug 2011

See all articles by Wulf A. Kaal

Wulf A. Kaal

University of St. Thomas, Minnesota - School of Law

Richard W. Painter

University of Minnesota Law School

Date Written: February 21, 2011

Abstract

This article evaluates the ambiguities and shortcomings of the U.S. Supreme Court decision in Morrison with a particular emphasis on the implications of the recent Porsche decision in the Southern District of New York. We conclude that the ambiguities in Morrison and the implications of interpreting Morrison for persons and companies in European jurisdictions and elsewhere in the world make it necessary for the U.S. Congress to further clarify the extraterritorial reach of the implied right of action under the Securities Exchange Act of 1934. We also conclude that the U.S. Congress should clarify its intent in Section 929P(b) of the Dodd-Frank Act of 2010 to give extraterritorial enforcement authority to the U.S. Securities and Exchange Commission (SEC) and U.S. Department of Justice. An SEC study of private rights of action is also required by the Dodd-Frank Act, but regardless of the outcome of this study, Congress should decline to reinstate private rights of action in “foreign-cubed” cases. Restraining and clarifying the U.S. approach to extraterritoriality could help provide certainty to international securities markets and avoid a downturn in international economic cooperation.

Keywords: Foreign-Cubed, Dodd-Frank Act, Securities Regulation, Securities Litigation, Morrison, Porsche, Section 929P(b), Section 929Y, Jurisdiction, Section 10(b)

JEL Classification: K2, K22

Suggested Citation

Kaal, Wulf A. and Painter, Richard W., The Aftermath of Morrison v. National Australia Bank and Elliott Associates v. Porsche (February 21, 2011). European Company and Financial Law Review, Vol. 1, 2011, Available at SSRN: https://ssrn.com/abstract=1765901

Wulf A. Kaal (Contact Author)

University of St. Thomas, Minnesota - School of Law ( email )

MSL 400, 1000 La Salle Avenue
Minneapolis, MN Minnesota 55403-2005
United States

Richard W. Painter

University of Minnesota Law School ( email )

229 19th Avenue South
Minneapolis, MN 55455
United States
612-626-9707 (Phone)

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