Materiality, not ‘Extreme Departure,’ Governs Intra-Quarter Disclosure in 9th Circuit Securities Case

The Ninth U.S. Circuit Court of Appeals recently issued an opinion setting the standards for intra-quarter disclosure obligations under the Securities Act of 1933 in the context of initial public offerings, emphasizing that materiality, not the “extreme departure” standard, governs disclosure requirements. Partners Virginia Milstead and Mark Foster and associate Alyssa Musante discuss contested IPO disclosures, the legal standards applied and the implications for public companies regarding materiality assessments of intra-quarter financial results.