A Court's Guide on How to Gut Precedent by Relying on it: Halliburton IPs Puzzling Effect on Securities-Fraud Class Actions

• Author: Leah Neupert
• Pages: 225-266

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$&RXUW¶V*XLGHRQ+RZWR*XW3UHFHGHQWE\5HO\LQJ

RQLWHalliburton II¶V3X]]OLQJ(IIHFWRQ6HFXULWLHV

)UDXG&ODVV$FWLRQV

7$%/(2)&217(176

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, 7KH(YROXWLRQRI3ULYDWH6HFXULWLHV)UDXG&ODVV$FWLRQV

 $ 7KH5HTXLVLWH(OHPHQWVIRUD5XOHE&ODLP

%Basic6LPSOH1DPH,QWULFDWH3UREOHPV

 & &ODVV$FWLRQVLQWKH$IWHUPDWKRIBasic

 ' 7KH&KDQJHLQ0HDQLQJRI³0DWHULDOLW\´DQG

³3ULFH,PSDFW´6LQFHBasic

  7KH&RQFHSWRI³0DWHULDOLW\´IURPBasic

)XQGDPHQWDOO\$OWHUHGRYHU7LPH

  7KH&RQFHSWRI3ULFH,PSDFWIURPBasic

)XQGDPHQWDOO\$OWHUHGE\Dura

,, Halliburton I DQGAmgen/HVVHQLQJWKH%XUGHQ

IRU&ODVV&HUWLILFDWLRQ

$Halliburton I/RVV&DXVDWLRQ1RW5HTXLUHGWR

,QYRNHBasic¶V3UHVXPSWLRQ

  7KH&RXUW¶V2SLQLRQ

  7KH6LJQLILFDQFHRIHalliburton I

%Amgen0DWHULDOLW\1RW5HTXLUHGWR,QYRNH

Basic¶V 3UHVXPSWLRQ

  7KH&RXUW¶V2SLQLRQ

  7KH6LJQLILFDQFHRIAmgen

,,, Halliburton II)XQGDPHQWDOO\$OWHULQJ3UHFHGHQW

E\5HO\LQJRQLW

 $ 7KH0DMRULW\¶V5HFRQVLGHUDWLRQRIBasic

  +DOOLEXUWRQ¶V$WWDFNRQWKH3UHPLVHVRIWKH

Basic3UHVXPSWLRQ

  +RQRULQJ6WDUH'HFLVLVDQG+DOOLEXUWRQ¶V

$OWHUQDWLYH$UJXPHQWV

 % $OWHUQDWLYHVWR2YHUUXOLQJBasic5HEXWWLQJWKH

3UHVXPSWLRQRI5HOLDQFH

  3ODLQWLIIV1RW5HTXLUHGWR6KRZ3ULFH,PSDFW

WR,QYRNH3UHVXPSWLRQ

 LOUISIANA LAW REVIEW >9RO

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  'HIHQGDQWV$OORZHGWR,QWURGXFH'LUHFWDQG

,QGLUHFW(YLGHQFHRIWKH$EVHQFHRI3ULFH,PSDFW

WR5HEXW3UHVXPSWLRQDW&ODVV&HUWLILFDWLRQ

& 'LVWLQJXLVKLQJAmgen

,9 ,QWHUSUHWL QJHalliburton II7KH5XLQVRIHalliburton I

DQGAmgen

 $ 7KH&RUUHFW,QWHUSUHWDWLRQRIHalliburton II

  7KH%XUGHQRI3URRI

  +RZ'HIHQGDQWV0XVW0HHWWKHLU%XUGHQRI3URRI

ZLWK5HVSHFWWR3ULFH,PSDFW

 % *XWWLQJHalliburton I DQGAmgen

  3ULFH,PSDFW$QRWKHU1DPHIRU/RVV&DXVDWLRQ

DQG0DWHULDOLW\

  ,UUHFRQFLODEOH+ROGLQJVHalliburton IIYHUVXV

Halliburton IDQGAmgen

  $3X]]OLQJ/HJDO2XWFRPH

 & 7KH&RUUHFW,QWHUSUHWDWLRQ¶V3UDFWLFDO,PSDFW

9 $OWHUQDWLYH,QWHUSUHWDWLRQVRIHalliburton II

$Basic¶V 8QGHUVWDQGLQJRI3ULFH,PSDFW1R&KDQJH

2FFXUUHG

 % )XOO$GKHUHQFHWRHalliburton IDQGAmgen

 & 5HTXLULQJ&OHDUDQG&RQYLQFLQJ(YLGHQFHRID

/DFNRI3ULFH,PSDFW

 ' $5HFRPPHQGHG$SSURDFK$SSO\WKH7UXH

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,1752'8&7,21

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

Id. see also 'HQLVH 1 0DUWLQ 9LQLWD 0 -XQHMD 7RGG 6 )RVWHU 

)UHGHULFN&'XQEDU Recent Trends IV: What Explains Filings and Settlements

in Shareholder Class Actions67$1-/%86),1

  86'RQDOG&/DQJHYRRUW%DVLF at Twenty: Rethinking

Fraud on the Market:,6/5(9 ³7HQV RIELOOLRQV RI GROODUV

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UHVXOWRIBasic´

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RSHUDWHDVDIUDXGRU GHFHLWXSRQDQ\SHUVRQLQFRQQHFWLRQ ZLWKWKHSXUF KDVHRU

VDOHRI DQ\ VHFXULW\´(PSOR\PHQW RI 0DQLSXODWLYHDQG 'HFHSWLYH 'HYLFHV

&)5E

See, e.g.Basic86(ULFD3-RKQ)XQG,QFY+DOOLEXUWRQ&R

Halliburton I6&W$PJHQ,QFY&RQQ5HW3ODQV

7UXVW)XQGV 6&W+DOOLEXUWRQ&RY(ULFD3-RKQ)XQG,QF

Halliburton II6&W

Basic86DW

Id.DW

See, e.g. 'XUD3KDUP ,QF Y %URXGR  86 ± 

Halliburton I6&WDWAmgen 6&WDW

See, e.g. Halliburton I 6 &W  Amgen  6 &W DW 

6HFXULWLHVIUDXG DFWLRQV DOVR LQYROYH RPLVVLRQV E\ D FRUSRUDWLRQ WKDW UHQGHU D

SXEOLFVWDWHPHQWPLVOHDGLQJSee, e.g. .DVY&DWHUSLOODU,QF)6XSS