In Halliburton II, SCOTUS Upholds Presumption of Reliance in Securities Fraud Class Actions, but Allows Defendants to Rebut with Lack of Price Impact

June 25, 2014

In a decision that has important implications for both plaintiffs and defendants in securities class actions, the Supreme Court of the United States in Halliburton Co. v. Erica P. John Fund, Inc., No. 13-317 (June 23, 2014), refused to overturn the fraud-on-the-market presumption first announced in Basic Inc. v. Levinson, 485 U.S. 224 (1987), but recognized that defendants can rebut that presumption at the class certification stage by showing a lack of “price impact.”

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