Did you know we offer summary newsletters for even more practice areas and jurisdictions? Explore them here.Ĭourt Description: Securities Law. You already receive new opinion summaries from Ninth Circuit US Court of Appeals. Sign up for free summaries delivered directly to your inbox. Want to stay in the know about new opinions from the Ninth Circuit US Court of Appeals? The panel did not resolve the issue of whether plaintiff has sufficiently alleged the other elements of Section 12 liability. The panel explained that because standing existed for plaintiff's section 11 claim against Slack, standing also existed for a dependent section 15 claim against controlling persons. The panel concluded that plaintiff had standing to bring a claim under Sections 11 and 12(a)(2) because his shares could not be purchased without the issuance of Slack's registration statement, thus demarking these shares, whether registered or unregistered, as "such security" under Sections 11 and 12 of the Act. Plaintiff alleges that Slack's registration statement was inaccurate and misleading because it did not alert prospective shareholders to the generous terms of Slack's service agreements, which obligated Slack to pay for service disruptions nor did it disclose that these service disruptions were frequent in part because Slack guaranteed 99.99% uptime and the statement downplayed the competition Slack was facing from Microsoft Teams at the time of its direct listing.
The Ninth Circuit affirmed the district court's order denying in part a motion to dismiss and ruling that plaintiff had standing to sue Slack and individual defendants under Sections 11 and 12(a)(2) of the Securities Act of 1933 based on shares issued under a new rule from the New York Stock Exchange allowing companies to make shares available to the public through a direct listing.
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