Thursday, June 21, 2007
To probably no one's surprise, the Supreme Court ruled (8-1) that plaintiffs in private securities fraud actions must meet a high standard for pleading scienter.
"To qualify as strong....we hold an inference of scienter must be more than merely plausible or reasonable," Justice Ginsburg wrote. "It must be cogent and at least as compelling as any opposing inference of nonfraudulent intent."
More to follow, after reading the opinion. For now, see WSJ, Court Sets Securities Suit Standard.