Summary
The U.S. Court of Appeals for the Second Circuit recently affirmed the dismissal of a securities fraud class action against S&C client Barclays in Knapp v. Barclays PLC. S&C represented Barclays in the appeal. The court resolved two “issues of first impression” in the Second Circuit relating to issuer liability under the Securities Act. First, the court held that routine corporate events involving stock splits or reverse stock splits are not “sales” of securities that trigger liability under the Securities Act. Second, the court reinforced the Supreme Court’s 2023 decision in Slack Technologies, LLC v. Pirani, finding that the plaintiffs were required to trace their securities to the initial registration statement under which the pre-split securities were issued.
Background
In March 2022, Barclays Bank PLC (“Barclays”) announced it had inadvertently issued more than…
Review your monthly bank statements and credit card bills line-by-line to spot small “tester” transactions of R5 or R10, which fraudsters use to verify if a stolen card is still active.