From Sea to Shining Sea: The Ninth Circuit Aligns with the Second Circuit in Affirming “Omnicare” Decision’s Benefits for Securities-Suit Targets

greenedFinkelsteinGuest Commentary

By Doug Greene and Bret Finkelstein, a Partner and an Associate, respectively, with Lane Powell PC in the firm’s Seattle, WA office.

In a matter of first impression in the Ninth Circuit, the court applied the Supreme Court’s Omnicare standard for pleading the falsity of a statement of opinion in City of Dearborn Heights Act 345 Police & Fire Retirement System v. Align Technology, Inc., — F.3d —, 2017 WL 1753276 (9th Cir. May 5, 2017). The Ninth Circuit decision builds on the momentum for the defense bar following the 2016 Second Circuit opinion in Tongue v. Sanofi, 816 F.3d 199 (2d Cir. 2016), correctly applies the rationale of Omnicare to Section 10(b) cases, and applies the Omnicare falsity analysis to an important category of statements of opinion: accounting reserves.

The Supreme Court’s landmark 2015 decision, Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund, 135 S. Ct. 1318 (2015), was originally met with mixed reviews by securities litigators of all stripes. Some commentators—including members of the defense bar—raised alarm following Omnicare, worrying that the decision was a win for plaintiffs because they felt it created a new area of potential liability for statements of opinion that were honestly held, but nonetheless misleading. Continue reading “From Sea to Shining Sea: The Ninth Circuit Aligns with the Second Circuit in Affirming “Omnicare” Decision’s Benefits for Securities-Suit Targets”

Preserved Shark Repellent: Pennsylvania’s Abuse-of-Process Law Withstands a Constitutional Challenge

Shark_as_part_of_a_law_office_sign
Source: WikiMedia Commons

By Hillary Hunter, a 2017 Judge K.K. Legett Fellow at Washington Legal Foundation who will be entering her third year at Texas Tech University School of Law in the fall.

Suppose while swimming through life, innocently enough you draw the attention of an aggressive lawyer. You did nothing wrong, but still find yourself being circled by a predator. Now, like a shark sensing blood in the water, suppose the lawyer goes in for a bite. He files a baseless lawsuit, one aimed at wearing down your resources and patience to the point where you will surrender and settle. As you do your best to keep your head above water, you consider your options. Is there any shark repellent around?

Victims of lawsuit abuse in some states, in fact, do have legislatively crafted tools at their disposal to fight back. For example, Pennsylvania’s Dragonetti Act recently survived a state constitutional separation–of–powers challenge. The Pennsylvania Supreme Court’s decision to uphold the law in Villani v. Seibert reflects the shared responsibility of the legislative and judicial branches to direct a state’s legal system and govern attorney conduct. Continue reading “Preserved Shark Repellent: Pennsylvania’s Abuse-of-Process Law Withstands a Constitutional Challenge”