That Had To Hurt

The Wall Street Journal has an online debate (subscrip. req’d) between two securities litigators on the merits of scheme liability, a topic that will be addressed by the U.S. Supreme Court next term in the Stoneridge (a.k.a. Charter Communications) case. For those who like their debates slightly heated and reasonably entertaining, this will not disappoint. The WSJ Law Blog also has a related post where they invite comments on the topic.

Quote of note:

“Well, Sean, there you go again. You pick a troubling fact pattern — a Wall Street bank’s alleged involvement in a phony sale of assets to prop up corporate cash flow — to argue for the rewriting of the securities laws.”

. . . .

“Thanks Bob for your concession that Bank A’s conduct in my hypothetical was ‘troubling.’ That had to hurt. The question that investors would like to have you (and the Chamber of Commerce) answer is: do you think Bank A should get a pass for what it did in the (not so) hypothetical? Or is Bank A an ‘innocent’ third party that should be beyond the reach of defrauded investors?”