Litigation partners Andrew Ehrlich and David Friedman and counsel Daniel Sinnreich published an expert analysis in Law360 discussing the Ninth Circuit’s latest affirmance of the dismissal of securities fraud claims on loss causation grounds, finding that the stock price decline in the case following the purported revelation of the fraud was "modest, typical, and quickly reversed." In “Assessing The 9th Circ.'s Recent Stock Drop Dismissal Trend,” published on May 4, the authors explain how the decision in Nova Scotia Health Employees' Pension Plan v. Comerica Inc. reinforces a unique pattern in the Ninth Circuit, which has authored a series of opinions applying a rigorous loss causation analysis at the pleading stage, leading to the dismissal of fraud claims as a matter of law, based on the size, typicality and duration of the stock drop alone. The authors also discuss potential implications of the circuit’s contextual loss causation analysis on future securities fraud complaints within and outside the circuit.
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