The Supreme Court on Monday is set to hear arguments in a case that could dramatically raise the bar for shareholders seeking to file class-action lawsuits against public companies….
A federal trial court in Texas threw out the [Halliburton] case, ruling that shareholders hadn’t proved that their losses were tied to a particular statement made by the company or its officers — a concept known as loss causation. That decision essentially imposed a new test for plaintiffs to meet at the class-certification stage. An appeals court upheld the ruling. Plaintiffs’ and defense lawyers agree that a Supreme Court ruling upholding the lower courts could radically change the dynamic of shareholder lawsuits.
Read more: Supreme Court hears arguments on securities fraud — Reuters