Supreme Court Agrees with Professors' "F-Cubed" Amicus Brief
JUNE 24, 2010—In an opinion handed down today, the U.S. Supreme Court has agreed with the conclusion and many of the arguments in an amicus brief authored by Prof. Richard W. Painter and other law professors. The brief in Morrison v. National Australia Bank was signed by 21 American law professors, including Professors John Matheson and Edward Adams, and was submitted in February. Douglas Dunham of Skadden Arps in New York City represented the professors.
The brief urged the Court to adopt a bright line rule that foreign plaintiffs alleging fraud in connection with securities purchased or sold outside the United States should not be permitted to sue foreign defendants in U.S. courts (securities litigation often referred to as "f-cubed:" on behalf of foreign plaintiffs against foreign companies for trading on foreign exchanges).
The Court affirmed a Second Circuit holding in favor of National Australia Bank, 8-0. The opinion for the Court, written by Justice Scalia and signed by a majority of the justices, holds that Section 10(b) applies only to "transactions in securities on domestic exchanges, and domestic transactions in other securities" and not to transactions outside the United States.
"This ruling will provide predictability for transacting parties in the global securities market and avoid burdening United States courts with foreign disputes that are better resolved by the courts of countries involved," Painter says.
Read the professors' brief (PDF, 884KB)
The Supreme Court's opinion is available on the Supreme Court Web site: http://www.supremecourt.gov/opinions/09pdf/08-1191.pdf