Judgment Day for Fraud-on-the-Market: Reflections on Amgen and the Second Coming of Halliburton

Abstract:     

The Supreme Court has reaffirmed the "fraud on the market" presumption of reliance, facilitating large scale class actions for this kind of securities fraud. This essay traces the road from its decision last year in Amgen to this year's reaffirmation in Halliburton II, and considers some of the issues that will emerge as lower courts struggle with Halliburton II's secondary holding -- that the issue of "price impact" is crucial to class certification, even if the burden of proof is on the defendants.

Number of Pages in PDF File: 31

Keywords: securities, fraud, litigation

JEL Classification: K20, K22, K29

Accepted Paper Series