In enacting the Private Securities Litigation Reform Act (the “Reform Act”),[1]� Congress set out to separate the wheat from the chaff in the area of securities law claims.
Congress sought to do so with statutory standards for pleading fraud in such cases that are by their nature inexact: requiring that a complaint specify “each statement alleged to have been misleading, [and] the reason or reasons why the statement is misleading”,[2]� requiring that a complaint state with “particularity” all facts on which a belief of falsity is formed,[3]� and requiring that a complaint “state with particularity facts giving rise to a strong inference” of scienter.[4]� In so doing, Congress left considerable discretion to the courts to decide what constitutes “particularity” and whether factual allegations are sufficient to give rise to a strong inference. This article explores the way in which courts within the Second Circuit have applied the Reform Act’s pleading standards for scienter.
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.
For questions call 1-877-256-2472 or contact us at [email protected]
