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At the time that Roberts was nominated to be the chief justice, there were claims that he would head a “probusiness” Court. The decisions of Roberts Court, however, if anything show a bias toward the status quo. Tellabs, Halliburton, Amgen, and Jones all rebuffed efforts by lower courts to narrow the gates through which securities class actions could proceed. A fair-minded scorekeeper would have to put these decisions in the plaintiff’s column, despite the defendant’s nominal victory in Tellabs. In Tellabs, the Supreme Court reversed a lenient Seventh Circuit decision for drawing inferences with respect to scienter, but replaced it with a standard that is nonetheless relatively generous to plaintiffs. In so doing, the Court rejected a more stringent standard adopted by a number of lower courts and urged by both the governments as amicus and the dissenting justices. On balance, the Tellabs decision was likely a net benefit to the plaintiffs’ bar. Both Tellabs and Jones are cautious decisions, grounded in conventional approaches to statutory interpretation. Halliburton reverses a rogue lower court decision with little basis in the Supreme Court’s precedent. Amgen reads the Court’s precedent narrowly to keep the door open for class actions. Matrixx affirms the Roberts Court’s bias toward the status quo, continuing the Court’s open-ended approach to materiality from TSC and Basic. If the Roberts Court has a “probusiness” agenda, its selection of cases for review seems poorly suited for promoting its aims.
Stoneridge and National Australia, by contrast, adopt considerably more aggressive language. Both decisions rebuffed efforts by the plaintiffs’ bar to expand the pool of potential defendants; Stoneridge to third-party defendants, National Australia to foreign companies. The perceived disregard of Supreme Court precedents by lower courts in these cases were calculated to provoke hot-button responses from individual justices. In Stoneridge, it was Justice Kennedy, who likely saw “scheme liability” as an attempt to do an end run around the holding of his Central Bank opinion. (Janus, although it resolved a lower court split, simply confirmed the trend established by Stoneridge.) In National Australia, Justice Scalia was provoked by the Second Circuit’s disregard for the Court’s presumption against extraterritorial application. Accordingly, it should come as no surprise that the rhetoric in Stoneridge and National Australia takes on a more muscular tone. These decisions reflect the Roberts Court bringing the lower courts to heel. It is reaction to the lower courts’ waywardness, rather than any agenda peculiar to the securities laws, that drives the more strident tenor of those decisions.
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