Sen. Specter introduces legislation to reverse Stoneridge case; SIFMA opposes

08/6/2009 | Wall Street Journal, The

Sen. Arlen Specter, D-Penn., introduced legislation last month that could make it easier for plaintiffs' lawyers to file fraud suits from shareholders. If passed, the bill will reverse the Supreme Court's decision in Stoneridge Investment Partners LLC v. Scientific-Atlanta Inc., which prevents shareholders from suing third parties. The measure would also expand the number of shareholders who can sue for fraud. Some groups said the bill would have negative consequences. SIFMA spokesman Travis Larson said efforts to overturn the Stoneridge case are "totally misguided," adding that securities regulators "are already equipped with all the necessary regulatory tools to recoup lost money for investors."

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