Torys LLP’s Post

Interesting article on 12.4.24 U.S. Supreme Court decision Macquarie Infrastructure Corp. v. Moab Partners: found unanimously that “pure omissions are not actionable under Rule 10b-5(b).” In other words, a pure omission (i.e., where a speaker says nothing) cannot support a private claim under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b–5, even if such an omission could constitute a violation of Item 303 of Regulation S-K.

In Macquarie Infrastructure Corp. v. Moab Partners, the Court stated “[A] pure omission occurs when a speaker says nothing, in circumstances that do not give any special significance to that silence. Half truths, on the other hand, are “representations that state the truth only so far as it goes, while omitting critical qualifying information.” The Court continued: “[R]ule 10b–5(b) requires disclosure of information necessary to ensure that statements already made are clear and complete. Logically and by its plain text, Rule 10b–5(b) therefore covers half truths, not pure omissions, because it requires identifying affirmative assertions (i.e., “statements made”) before determining if other facts are needed to make those statements “not misleading.” The court did note however, that other provisions in the securities laws can give rise to liability for pure omissions including Securities Act Section 11 which prohibits any registration statement from omitting to state a material fact required to be stated therein. #SecuritiesLawBlog #USSupremeCourt #ALCLAW

In Macquarie Infrastructure Corp. v. Moab Partners, the Court stated “[A] pure omission occurs when a speaker says nothing, in circumstances that do not give any special significance to that silence. Half truths, on the other hand, are “representations that state the truth only so far as it goes, while omitting critical qualifying information.” The Court continued: “[R]ule 10b–5(b) requires disclosure of information necessary to ensure that statements already made are clear and complete. Logically and by its plain text, Rule 10b–5(b) therefore covers half truths, not pure omissions, because it requires identifying affirmative assertions (i.e., “statements made”) before determining if other facts are needed to make those statements “not misleading.” The court did note however, that other provisions in the securities laws can give rise to liability for pure omissions including Securities Act Section 11 which prohibits any registration statement from omitting to state a material fact required to be stated therein. #SecuritiesLawBlog #USSupremeCourt #ALCLAW

In Macquarie Infrastructure Corp. v. Moab Partners, the Court stated “[A] pure omission occurs when a speaker says nothing, in circumstances that do not give any special significance to that silence. Half truths, on the other hand, are “representations that state the truth only so far as it goes, while omitting critical qualifying information.” The Court continued: “[R]ule 10b–5(b) requires disclosure of information necessary to ensure that statements already made are clear and complete. Logically and by its plain text, Rule 10b–5(b) therefore covers half truths, not pure omissions, because it requires identifying affirmative assertions (i.e., “statements made”) before determining if other facts are needed to make those statements “not misleading.” The court did note however, that other provisions in the securities laws can give rise to liability for pure omissions including Securities Act Section 11 which prohibits any registration statement from omitting to state a material fact required to be stated therein. #SecuritiesLawBlog #USSupremeCourt #ALCLAW

On Friday the Supreme court ruled unanimously in the case between Macquarie Infrastructure Corp. vs Moab Partners that investors cannot sue public companies for omitting key information. According to the decision, SEC rule 10b-5(b) says that a public issuer cannot make “any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading.” This wording, according to the court, means omissions are only an issue if they make affirmative statements made misleading. Will this open up a can of worms for bad behaviour by public issuers? It should be noted that it does not prevent the Securities and Exchange Commission from taking enforcement actions for such omissions. Although in Canada enforcement seems to be lacking to begin with from regulators so the courts are an individuals best bet. Although this would allow precedence to public issuers to use in court which is alarming.

Read our latest edition of #Infrastructure Insights which provides an update on the legal and regulatory developments impacting the world of infrastructure in the UK and EU. https://lw.link/btMh6p This edition covers: - Proposed Revisions to EU #FDI Screening Regulation — Implications for Investors and Transactions - EU and Euratom to Withdraw From the #EnergyCharterTreaty: Impact on Investors - Pouring Oil on Troubled Waters? New UK Special #Insolvency Regime Is Now on Tap - Paving the Way for German #CarbonCapture and Storage - Corporates and Dealmakers Must Prepare for Increased UK #ClassAction Claims - First UK Bribery Conviction of Foreign Public Official Offers Key Learning Points

Read our latest edition of #Infrastructure Insights which provides an update on the legal and regulatory developments impacting the world of infrastructure in the UK and EU. https://lw.link/cDh8WI This edition covers: - Proposed Revisions to EU #FDI Screening Regulation — Implications for Investors and Transactions - EU and Euratom to Withdraw From the #EnergyCharterTreaty: Impact on Investors - Pouring Oil on Troubled Waters? New UK Special #Insolvency Regime Is Now on Tap - Paving the Way for German #CarbonCapture and Storage - Corporates and Dealmakers Must Prepare for Increased UK #ClassAction Claims - First UK Bribery Conviction of Foreign Public Official Offers Key Learning Points

Read our latest edition of #Infrastructure Insights which provides an update on the legal and regulatory developments impacting the world of infrastructure in the UK and EU. https://lw.link/l47rzd This edition covers: - Proposed Revisions to EU #FDI Screening Regulation — Implications for Investors and Transactions - EU and Euratom to Withdraw From the #EnergyCharterTreaty: Impact on Investors - Pouring Oil on Troubled Waters? New UK Special #Insolvency Regime Is Now on Tap - Paving the Way for German #CarbonCapture and Storage - Corporates and Dealmakers Must Prepare for Increased UK #ClassAction Claims - First UK Bribery Conviction of Foreign Public Official Offers Key Learning Points

Read our latest edition of #Infrastructure Insights which provides an update on the legal and regulatory developments impacting the world of infrastructure in the UK and EU. https://lw.link/Z7fJcd This edition covers: - Proposed Revisions to EU #FDI Screening Regulation — Implications for Investors and Transactions - EU and Euratom to Withdraw From the #EnergyCharterTreaty: Impact on Investors - Pouring Oil on Troubled Waters? New UK Special #Insolvency Regime Is Now on Tap - Paving the Way for German #CarbonCapture and Storage - Corporates and Dealmakers Must Prepare for Increased UK #ClassAction Claims - First UK Bribery Conviction of Foreign Public Official Offers Key Learning Points

Read our latest edition of #Infrastructure Insights which provides an update on the legal and regulatory developments impacting the world of infrastructure in the UK and EU. https://lw.link/32LA8E This edition covers: - Proposed Revisions to EU #FDI Screening Regulation — Implications for Investors and Transactions - EU and Euratom to Withdraw From the #EnergyCharterTreaty: Impact on Investors - Pouring Oil on Troubled Waters? New UK Special #Insolvency Regime Is Now on Tap - Paving the Way for German #CarbonCapture and Storage - Corporates and Dealmakers Must Prepare for Increased UK #ClassAction Claims - First UK Bribery Conviction of Foreign Public Official Offers Key Learning Points