Rewiring the DNA of Securities Fraud Litigation: Amgen's Missed Opportunity

19 Pages Posted: 25 Jun 2013 Last revised: 26 Sep 2013

Date Written: May 8, 2013

Abstract

This Essay, a contribution to a fall 2012 "Behavioral Economics and Investor Protection" symposium sponsored by Loyola-Chicago's Institute for Investor Protection (IIP), argues that securities fraud doctrine needs to be rebuilt. The lessons of behavioral economics undercut several of the key elements of the modern Rule 10b-5 securities fraud claim - including current approaches to materiality, scienter, and reliance. Drawing on my previous work on substantive tort law and securities fraud, I sketch the beginnings of a reformed approach in which securities fraud class actions would be modeled less on common law fraud than on deceptive and false advertising claims.

Keywords: securities fraud, Amgen, reliance, materiality, scienter, recklessness

JEL Classification: K22

Suggested Citation

Rapp, Geoffrey Christopher, Rewiring the DNA of Securities Fraud Litigation: Amgen's Missed Opportunity (May 8, 2013). Loyola University Chicago Law Journal, Vol. 44, No. 5, 2013, University of Toledo Legal Studies Research Paper No. 2013-14, Available at SSRN: https://ssrn.com/abstract=2282742

Geoffrey Christopher Rapp (Contact Author)

University of Toledo College of Law ( email )

2801 W. Bancroft Street
Toledo, OH 43606
United States

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