In Re Intelligroup Securities Litigation’s Empirical Analysis
2007
Citation profile
2 federal appellate · 5 district · 1 state decisions
Relationships
Applies 15 U.S.C. § 78A (§ 1 of the Securities Exchange Act of 1934) · 15 U.S.C. § 78J (§ 10 of the Securities Exchange Act of 1934) · 15 U.S.C. § 78M (§ 13 of the Securities Exchange Act of 1934) · 15 U.S.C. § 78T (§ 20 of the Securities Exchange Act of 1934) · 15 U.S.C. § 78U (§ 21d of the Securities Exchange Act of 1934)
Relies on Bell Atlantic Corp. v. Twombly · Conley v. Gibson · Harlow v. Fitzgerald · Scheuer v. Rhodes · Daubert v. Merrell Dow Pharmaceuticals, Inc.
Most-quoted passages
The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 18 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.
“[A]n inflated purchase price [does] not ... constitute or proximately cause the relevant economic loss. [T]he logical link between the inflated share purchase price and any later economic loss is not invariably strong. Shares are normally purchased with an eye toward a later sale. [So,] if ... the purchaser sells the shares ... before the relevant truth begins to leak out, the misrepresentation will not have led to any loss. [Moreover, if] the purchaser sells ... after the truth makes its way into the market place, an initially inflated purchase price might mean a later loss. But that is far from inevitably so [since] that lower price [at the time of sale] may reflect not [the result of truth leaking out about] the earlier misrepresentation, but changed economic circumstances, changed investor expectations, new industry-specific or firm-specific facts, conditions, or other events, which taken separately or together account for some or all of that lower price.... Other things being equal, the longer the time between purchase and sale, the more likely that this is so, i.e., the more likely that other factors caused the loss. Given the tangle of factors affecting price, ... the higher purchase price ... may prove to be a necessary condition of [an economic] loss, ... but, even if ... so, it is [not sufficient in and by itself since it is] not [the] cause [of the economic] loss.... The securities statute[ ] ... make[s private] actions available not to provide investors with broad”
1 later decision quote this exact passage · from the dissent“it appears that the “more” envisioned by the courts consists of the panoply of such facts which could sufficiently indicate that defendants had clear reasons to doubt the validity of the issuer’s financials but, nonetheless, kept turning a blind eye to all such factual “red flags.” See Rothman, 220 F.3d 81 (plaintiffs did not adequately plead scienter where the complaint alleged that defendants’ policy of expensing prepaid royalties was contrary to GAAP, resulting in nearly $ 74 million in royalties continuing to be reported as assets long after they should have been expensed); Comshare, 183 F.3d at 553 (plaintiffs failed to plead scienter properly — although plaintiffs’ allegations combined both GAAP violations and claims of failure to adequately monitor relevant information — since plaintiffs did not allege specific facts to show that defendants knew or could have known about the accounting errors, “or that their regular procedures should have alerted them to the errors sooner than they did”) ... In re Health Mgmt. Inc. Sec. Litig., 970 F.Supp. 192 (E.D.N.Y.1997) (a strong inference of recklessness is sufficiently pled where the complaint alleges that defendant was actually advised of but ignored “red flags”).”
1 later decision quote this exact passage · from the dissent“[G]ranting Plaintiff yet another leave to amend on the grounds of issuance of new clarifying decisions would: (a) create an anomalous precedent preventing any conclusive litigation by enabling securities plaintiffs to perpetually seek leave to amend their insufficient complaints through a mere act of citing those judicial decisions, which were issued after these plaintifffs] filed their complaints, and (b) therefore, frustrate the whole purpose of both Rule 15(a) and PSLRA.”) . According to plaintiff, that finding”
1 later decision quote this exact passage · from the majority
How this case has been treated — in progress
Whether each later court followed, distinguished, criticized, or overruled this decision. The treatment classification (task #35) runs highest-cited cases first and lights up here as it reaches this one.