Cleary Gottlieb’s “2020 Developments in Securities and M&A Litigation” discusses major developments from 2020 and highlights significant decisions and trends ahead.

In Liu v. SEC, the most notable securities decision of 2020, the Supreme Court cemented but limited the SEC’s authority to seek disgorgement as “equitable relief” for a securities law violation.

The Circuit courts also issued opinions that impact shareholder suits alleging violations of the securities laws, addressing both the standards district courts must use in considering defendants’ efforts to rebut the fraud-on-the-market presumption of reliance by showing a lack of price impact, as well as the validity of the “price maintenance” theory of inflation. A decision from the Second Circuit also provided helpful guidance concerning the requirements for pleading scienter in securities actions and the Supreme Court granted certiorari in the matter. The Ninth Circuit also weighed in on whether unproven allegations in whistleblower lawsuits and short-seller reports may constitute corrective disclosures in fraud-on-the-market securities cases.

Please click here for a PDF version of 2020 Developments in Securities and M&A Litigation.