If you thought there’d be stinging criticism from the country’s largest association of trial lawyers toward the Supreme Court for yesterday’s decision in Stoneridge Investment Partners, which curbed defrauded stockholders’ ability to sue third party actors in the fraud scheme, you thought wrong.
In fact, Kathleen Flynn Peterson, president of the American Association for Justice, said in a statement that she was “encouraged” by the decision’s narrowness. Clearly trying to make lemonade of the lemons seemingly dealt to trial lawyers by Justice Anthony Kennedy’s decision, Flynn Peterson said:
“AAJ is encouraged by the narrowness of the Court’s decision. The Court clearly stated that defrauded investors still have an avenue for recourse under this country’s securities laws. It was very careful to make the distinction between secondary actors involved in the financial spheres, as opposed to the goods and services industry.
“We are hopeful that this means that the investors defrauded in the Enron case still have the opportunity to recover and rebuild their lives. For the thousands of families who lost their pensions and retirement savings in that debacle, we find it encouraging the Court acknowledged the securities laws do protect them. However, we are disappointed that the Court’s decision will prevent investors from holding all knowing participants in a fraud – no matter what industry they are a part of – for actively engaging in fraudulent schemes.”