High court limits securities suits over deceptive comments
WASHINGTON (AP) — A unanimous Supreme Court says investors can't sue companies for making misleading statements of opinion prior to a public stock offering just because those statements ultimately turn out to be wrong.
But the ruling Tuesday said some opinions in registration documents might omit important facts that could mislead investors, giving them a right to sue for securities fraud.
The narrow ruling offered a limited victory to nursing home pharmacy Omnicare Inc., which was sued by investors who bought stock when it went public. A federal appeals court ruled that Omnicare offered "objectively false" opinions by saying it "believed" contracts with other companies were legal.
The high court said that wasn't the right standard. The justices said lower courts must decide if Omnicare omitted facts that were material to investors.