2013] OPINIONS ACTIONABLE 383
securities litigation in the wake of the stock market crash of 2000
and the financial crisis of 2008 has centered on allegedly
fraudulent opinions. After the 2000 crash, sell-side securities
analysts were widely blamed for allegedly issuing “buy”
recommendations consistent with the interests of their firms’
investment banking clients but inconsistent with their own
opinions about the covered stocks,1 leading to widespread
securities litigation.2 Similarly, in the wake of the 2008 crisis,
credit rating agencies were pilloried for allegedly issuing credit
ratings consistent with the interests of their firms’ clients but
inconsistent with their own opinions about the rated securities,3
also leading to securities litigation.4 Finally, in the wake of both
crashes, many companies—including quintessential examples like
Worldcom and Citigroup—were sued by their investors for
allegedly expressing unduly optimistic opinions about their
1. E.g., Joint Press R elease, Sec. & Exch. Comm’n, N.Y. Attorney Gen.’s
Office, N. Am. Sec. Adm’rs. Ass’n, Nat’l Ass’n of Sec. Dealers, & N.Y. Stock
Exch., Ten of Nation’s Top Investment Firms Sett le Enforcement Actions
Involving Confli cts of Interest Be tween Research and I nvestment Bankin g (Apr.
28, 2003), available at http://www.sec.gov/news/press/2003-54.htm (announcing
the finalization of a global settlement with ten firms “follow[ing] joint
investigations b y the regulator s of allegations o f undue influence o f investment
banking interests on securities r esearch at brokerage firms”).
2. E.g., In re Credit Suisse First Bos. Corp., 431 F.3d 36, 46 (1st Cir.
2005) (Purchasers of Agilent Technologies, Inc. stock alleged that the “buy”
ratings in Credit Suisse’s analyst reports were fraudulent because the analysts
“actually believed that wise investors should not purchase Agilent securities.”).
3. CONCLUSIONS OF THE FINANCIAL CRISIS INQUIRY COMMISSION xxv
(2011), available at http://fcic-static.law.stanford.edu/cdn_media/fcic-reports
/fcic_final_report_conclusions.pdf (“We conclude the failures of credit rating
agencies were essential cogs in the wheel of financial destruction. The three
credit rating agencies were key enablers of the financial meltdown.”).
4. E.g., King Cnty., Wash. v. IKB Deutsche Industriebank AG, 708 F.
Supp. 2d 334, 336 (S.D.N.Y. 2010) (Investors who purchased notes issued by a
structured investment vehicle alleged that credit rating agencies assigned
fraudulently high credit ratings to the notes.).
5. E.g., In re Citigroup Inc. Sec. Litig., 753 F. Supp. 2d 206, 229
(S.D.N.Y. 2010) (Citigroup investors premised securities fraud claims on
various alleged misr epresentations, inc luding the CEO’s st atement that “I fee l
good about the composition of our portfolios, not only in the corporate and
sovereign area but especially in the U.S. mortgage area where we have avoided
the riskier products at some cost to revenues in prior years.”); In re MCI
Worldcom, Inc. Sec. Litig., 191 F. Supp. 2d 778, 786 (S.D. Miss. 2002)
(Worldcom investors premised securitie s fraud claims on various alleged
misrepresentations, including the company’s statement that “[t]he local and global
reach of our network continues to set Worldcom apart from the rest of the