The U.S. Supreme Court unanimously reversed the Sixth Circuit yesterday in a securities fraud action brought against Omnicare, Inc., a Cincinnati pharmaceuticals services company, under Section 11 of the Securities Act of 1933, 15 U.S.C. § 77k. See Omnicare Inc. v Laborers District Council Construction Industry Pension Fund, Case No. 13-435 (2015) (PDF). In siding … Continue Reading
Creating a split with the Second and Ninth Circuits, the Sixth Circuit has held that Section 11 of the Securities Act, 15 U.S.C. § 77k, which creates liability for false statements in registration statements, provides for strict liability and so does not require allegations of knowledge of falsity. The panel in Ind. State Dist. Council … Continue Reading
In Ashland, Inc. v. Oppenheimer, No. 10-5305 (6th Cir. July 28, 2011).pdf, the Sixth Circuit eschewed the checklist of non-exhaustive factors set forth in Helwig v. Vencor Inc., 251 F.3d 540, 552 (6th Cir. 2001).pdf, for analyzing scienter in securities-fraud cases. Instead, the Sixth Circuit, in an opinion by Judge Cook, followed the “holistic” approach … Continue Reading
“In the end, plaintiffs’ allegations do not raise a strong inference that Ernst & Young acted with scienter in affirming Accredo’s allegedly fraudulent accounting. Conclusory allegations about what Ernst & Young must or should have known while auditing Accredo do not amount to specific allegations that show material misstatements or omissions committed with recklessness. Plaintiffs … Continue Reading
