Setting limits on a potentially powerful weapon
Article Abstract:
The US Supreme Court limited the scope of the 1933 Securities Act section 12(2) to only public offerings in Gustafson v. Alloyd Co., undercutting the Act's intent to protect the general public. The Act was designed to increase public confidence in the securities market and yet this ruling limits the remedies for securities fraud by creating a distinction between private agreements to sell securities and public offerings, leaving plaintiffs to meet the more stringent standards of the 1934 Act's section 10b. This decision violates the intent of the 1933 Act and reverses many lower courts.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1996
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Shareholder protection through strict statutory construction
Article Abstract:
The Delaware Supreme Court's decision in Alabama By-Products v. Cede & Co. adhering strictly to appraisal statute procedures favors beneficial shareholders and burdens corporations. The Court found that, when shares are held by the broker in a depository, shareholders with perfected appraisal rights can share in the appraisal award even if the recordholder had inadvertently tendered the stock. The ruling limits the benefits of depository use and imposes on corporations a duty to monitor share redemptions.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1997
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The tangled web of issuer liability for analyst statements
Article Abstract:
The US Northern District Court of California in 1996's In re Cirrus Logic Securities Litigation elucidated the determinants for liability of securities issuers for information in third party analysts' reports. Future cases may clarify remaining issues of adoption and entanglement. The issue of selective disclosure is likely to remain open and should be considered along with other acts and omissions which could lead to issuer liability.
Publication Name: Delaware Journal of Corporate Law
Subject: Law
ISSN: 0364-9490
Year: 1997
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