Halliburton Co. v. Erica P. John Fund was finally decided this summer (for background on this case, including the issues, see my first two articles on the case here and here) and the presumption of reliance on the integrity of the stock price that was created in Basic v. Levinson was upheld. The fraud-on-the-market theory is alive and well. Halliburton (the petitioners to the Court and the defendants in the class action) also lost on their request to require that plaintiffs in securities class actions prove “price impact” at the class certification stage. They won a small victory by granting defendants in securities class actions the ability to rebut the presumption of an efficient market at the class certification stage so they will no longer have to wait until arguments are made on the merits of the case in order to address it.
