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Second Circuit Review: ‘Predominantly Foreign’ Securities Claims
March 24, 2021
Litigation of counsel Martin Flumenbaum and firm chairman Brad Karp’s latest Second Circuit Review column, “‘Predominantly Foreign’ Securities Claims,” appeared in the March 24 issue of the New York Law Journal. The authors discuss Cavello Bay Reinsurance v. Shubin Stein, an opinion in which the U.S. Court of Appeals for the Second Circuit affirmed the dismissal of Securities Exchange Act of 1934 claims asserted by a foreign company against another foreign company with its principal place of business in New York. The decision reinforces the Second Circuit’s jurisprudence that the Exchange Act does not apply to securities claims that are “predominantly foreign,” even if the claims are based on nominally domestic transactions, and continues the Second Circuit’s trend of taking a narrow approach to the extraterritorial reach of the federal securities laws. Litigation associate Louis Murray assisted in the preparation of this column.
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