NEW YORK — Investors who bought shares in Switzerland-based UBS A.G. on exchanges outside the United States cannot sue over the bank’s sharp stock drop as a result of its exposure to risky securities, a federal judge has ruled, citing last year’s U.S. Supreme Court decision in Morrison v. National Australia Bank Ltd.
U.S. District Judge Richard Sullivan ruled on Sept. 13 that both so-called “foreign squared” investors — American investors who bought stock in a foreign company on a foreign exchange — and “foreign cubed” investors — foreign investors who bought stock in a foreign company on a foreign exchange — lacked standing to bring a securities fraud suit under U.S. law, even if the foreign transactions had an effect in the United States.
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