Securities
Apr. 1, 2015
Sometimes IPO 'lock ups' lock away a key defense
It's a familiar scenario: A company conducts an initial public offering; a quarter or two later, it stumbles. There might be an easier way to nip the inevitable lawsuit in the bud. By Boris Feldman and Ignacio E. Salceda
It's a familiar scenario: A company conducts an initial public offering. A quarter or two later, it stumbles. The stock price drops below the IPO price and plaintiffs sue in superior court under Section 11 of the Securities Act of 1933, alleging that the IPO registration statement should have warned of the problems that surfaced several quarters later.
Defendants face a complaint that they cannot challenge o...
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