Kirkland Alert Kirkland & Ellis LLP

Courts Increasingly Skeptical of Need to Routinely Disclose Government Investigations under Rule 10b-5

The U.S. District Court for the Southern District of New York, among the most important courts in the country for securities suits, has recently held that there exists no per se duty to disclose regulatory investigations, or even Wells Notices, to shareholders under Section 10(b) of the Exchange Act or Rule 10b-5.