In , respondent filed numerous actions under section 16 b of the Securities Exchange Act of , 15 U. She also claimed that petitioners had failed to comply with section 16 a 's requirement that insiders disclose any changes to their ownership in interests. That failure, according to respondent, tolled section 16 b 's 2-year time period. The district court dismissed and the Ninth Circuit reversed, citing its decision in Whittaker v. Whittaker Corp. The Court held that, even assuming that the 2-year period could be extended, the Ninth Circuit erred in determining that it was tolled until a section 16 a statement was filed.
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Please contact customerservices lexology. On March 26, , the U. Simmonds , No. Section 16 b creates a cause of action for holders of securities against corporate officers, directors, or other owners who realize profits from the purchase and sale, or sale and purchase, of the corporation's securities within any six-month period. The statute imposes a form of strict liability and requires insiders to disgorge "short-swing" profits even if they were not trading on inside information.
Section 16 b provides that such suits must be brought within "two years after the date such profit was realized. The Ninth Circuit's rule was also inequitable because it had the potential for "endless tolling" in certain cases.
Instead, the Court remanded to lower federal court "to consider how the usual rules of equitable tolling apply to the facts of this case. Justice Scalia delivered the opinion for a unanimous court.
Chief Justice Roberts did not participate. Download Opinion of the Court. If you would like to learn how Lexology can drive your content marketing strategy forward, please email enquiries lexology. Keep up the good work, it's most appreciated!. Back Forward. Share Facebook Twitter Linked In. Follow Please login to follow content. Register now for your free, tailored, daily legal newsfeed service. USA March 26 Justman and Jon Laramore.
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Supreme Court decides Credit Suisse Securities (USA) LLC v. Simmonds
On Monday, the court will release orders from the June 4 conference at a. There is a possibility of opinions at 10 a. We will be live-blogging starting at a. Judgment : Vacated and remanded , , in an opinion by Justice Scalia on March 26,
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Back to Submissions. Whether the two-year statute of limitations established in Section 16 b of the Securities and Exchange Act of the Act , which requires statutory insiders to disgorge profits from short-swing transactions in publicly traded issuer securities, begin to run if the targeted insider has failed to comply with its obligations under Section 16 a of the Act to disclose short-swing trading activity in reports filed with the SEC. Court: U. Court of Appeals Second Circuit pet. Amicus Briefs Credit Suisse v. Supreme Court Amicus Issue: Whether the two-year statute of limitations established in Section 16 b of the Securities and Exchange Act of the Act , which requires statutory insiders to disgorge profits from short-swing transactions in publicly traded issuer securities, begin to run if the targeted insider has failed to comply with its obligations under Section 16 a of the Act to disclose short-swing trading activity in reports filed with the SEC.
Credit Suisse Securities (USA) LLC v. Simmonds, 566 U.S. 221 (2012)
Vanessa Simmonds alleged in 54 separate complaints that several investment banks shared in the profits of customers who received IPO. Vanessa Simmonds brought suit under Section 16 b of the Securities Exchange Act of in order to recoup profits realized by Credit Suisse and other. Albrecht Mission Product Holdings Inc. Go to Petitioners maintain that these suits were properly dismissed because they were filed more than two years after the alleged profits were realized.