Regents of the University of California, et al. v. Credit Suisse First Boston (USA), Inc., et al.

Case Updates

Agreeing with NCLC, the Fifth Circuit adopted a test, which clarifies that only a defendant’s own conduct can support liability under the securities laws.

NCLC filed a brief urging the Fifth Circuit to adopt a test, which clarifies that only a defendant’s own misstatements and omissions can support liability under the securities laws. In Central Bank of Denver v. First Interstate Bank, the Supreme Court concluded that private plaintiffs may not advance claims for aiding and abetting liability under Section 10(b) of the Securities and Exchange Act. In its brief, NCLC argued that the district court, in permitting plaintiffs to rely on the defendants’ “purpose and effect” in conducting their transactions, did not properly assess whether any of those transactions were themselves fraudulent within the meaning of the securities laws.