Pleading Loss Causation Based on Short-Seller Reports

Reuters Legal News

Alexander C. Drylewski Virginia F. Milstead

Partners Alexander Drylewski and Virginia Milstead and associate Sahng-Ah Yoo look at the connection between corrective disclosure on stock price declines and short-seller reports. The authors analyze recent decisions by the 9th Circuit in securities fraud cases and discuss the consideration of short-seller reports as corrective disclosures sufficient to plead loss causation.