Second Circuit Adopts Broad Class Standing Test and Concludes Out-of-Pocket Loss Not Required to Plead Section 11 Claim

On September 6, 2012, the U.S. Court of Appeals for the Second Circuit held that an investor that purchased mortgage-backed securities in two shelf registration statement offerings had standing to litigate securities fraud claims on behalf of investors that purchased different securities in other offerings pursuant to the same shelf registration statement, but only to the extent the mortgages backing all of the securities were originated by the same mortgage lenders.