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ARTICLE · 10 MAY 2024

Secondary Market Securities Class Actions In Canada And The US: When Are Pure Omissions Actionable?

Crawley MacKewn Brush LLP
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The recent unanimous decision of the United States Supreme Court in MacQuarie Infrastructure Corporation et al. v. Moab Partners, L.P. et. al (2024) 144 S.Ct. 885 highlights...

CanadaLitigation, Mediation & Arbitration
Linda Fuerst
Linda Fuerst
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The recent unanimous decision of the United States Supreme Court in MacQuarie Infrastructure Corporation et al. v. Moab Partners, L.P. et. al (2024) 144 S.Ct. 885 highlights a key distinction between when an issuer's failure to disclose required information is actionable pursuant to private rights of action under U.S. federal securities legislation as compared to statutory secondary market causes of action in Canadian provincial securities laws.

In MacQuarie, the United States Supreme Court ("Court") determined that an issuer's "pure omission" to disclose in its MD&A information required under Item 303 of Securities and Exchange Commission Regulation S-K ("Item 303")[1] did not give rise to a private cause of action under Section 10(b) and Rule 10b-5(b) of the Securities Exchange Act of 1934 (the "1934 Act"). Rule 10b-5(b) (the "Rule") makes it unlawful "[t]o make any untrue statement of a material fact or to omit to state a material fact necessary in order to

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