Washington, DC-U.S. Chamber Institute for Legal Reform President Lisa A. Rickard released the following statement on the deadline on amicus filings in support of the plaintiff’s position in Stoneridge Investment Partners v. Scientific-Atlanta. The case, a securities class action pending before the U.S. Supreme Court, is widely viewed as precedent-setting that will determine whether or not a company can be sued simply because it did business with an alleged violator.
“The Stoneridge case and its theory of ‘scheme liability’ is a bold attempt by plaintiffs’ attorneys to drastically expand securities class actions at the same time prominent academics and others are questioning whether the existing system, which duplicates SEC enforcement actions, benefits investors.
“It is not enough for plaintiffs’ attorneys to sue investors of companies accused of alleged wrongdoing, they want to also be able to sue innocent bystanders-investors in companies that simply did business with the alleged violator.
“This sort of legal free-for-all is what makes foreign companies wary of listing on U.S. markets and hurts U.S. competitiveness. If the Stoneridge decision is not upheld, foreign companies will think twice before doing business with U.S. firms for fear of being drawn into the American lawsuit system.
“Plaintiffs’ attorneys like Bill Lerach-who has been the fiercest advocate of ‘scheme liability’-claim they are trying to protect investors, but this issue is not about protecting investors, it is about protecting the profits of plaintiffs’ lawyers. Mr. Lerach’s law firm alone made hundreds of millions of dollars last year in legal fees from these kinds of cases.”
The mission of the Institute for Legal Reform is to make America’s legal system simpler, fairer, and faster for everyone. It seeks to promote civil justice reform through legislative, political, judicial, and educational activities at the national, state, and local levels. The U.S. Chamber of Commerce is the world’s largest business federation, representing more than 3 million businesses and organizations of every size, sector, and region.