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Stoneridge at the ABA Mid-year Meeting

The ABA’s mid-year meeting will be held in “sunny Los Angeles” on February 6-12, 2008. On Friday, February 8th, at 10:45 am to 12:15 pm, the Administrative Law section will sponsor a panel discussion on An Insider’s View of the Stoneridge Case - Investor Protection or Frivolous Litigation? The panel includes:

• Stephen Bainbridge, Professor, UCLA Law School, Los Angeles, CA


• Robert R. Gasaway, Partner, Kirkland & Ellis LLP, Washington, D.C.


• Stanley M. Grossman, Partner, Pomerantz Haudek, New York, NY


• Thomas Karr, Assistant General Counsel, Securities and Exchange Commission, Washington, D.C.


• Moderator: Abigail Arms, Partner, Shearman & Sterling LLP, Washington, D.C.

Program notes:

Argued before the Supreme Court on October 9, 2007, by panelist Stanley M. Grossman, the case of Stoneridge Investment Partners v. Scientific-Atlanta is viewed by many securities law experts as a potential watershed that may significantly expand investor rights. [Ed: Wrong!]

Specifically, the case deals with the question of whether there exists an implied private right of action against third parties for primary liability in connection with a fraud under Sec. 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5. One of the major issues the panel will discuss is the scope of implied private rights of action. These judicially created actions are not limited to securities law. They are found in other substantive areas of administrative law such as Title IX (education), the FCC, and various civil rights statutes. Whether courts should continue to imply private rights of action at all is something one of the Justices commented on during the Stoneridge oral argument. The plaintiffs in Stoneridge have argued that the law permits it to sue actors who participate in a fraudulent scheme, not as aiders or abettors, but as “primary violators” who are ultimately tied to market movements. The defendants have countered that the law reaches only those who make deceptive communications to shareholders or engage in fraudulent trading on the market.

All of the panelists below have either written, or participated in, the writing of the briefs filed with the Supreme Court in this case.