Sunday, December 18, 2011
Mixed Statements: The Safe Harbor's Rocky Shore, by Wendy Gerwick Couture, University of Idaho College of Law, was recently posted on SSRN. Here is the abstract:
In this essay, the author analyzes how to apply the Private Securities Litigation Reform Act’s safe harbor for forward-looking statements to “mixed statements” – in which statements about the past or present are intertwined with statements about the future. The author identifies three categories of mixed statement that are the subject of frequent litigation, demonstrates the courts’ disagreement about their treatment, and – drawing from the statutory text and policy rationales – recommends how the safe harbor should apply to each category of statement.
In particular, the author argues that (1) statements of historical or current fact that underlie predictions should not be protected by the safe harbor; (2) statements about the present that necessarily incorporate predictions should be protected by the safe harbor; and (3) statements that contain both present and future components should be bifurcated, with the safe harbor protecting only those portions that predict.