Ever since the Supreme Court came out with its ruling last year in Janus Capital Group v. First Derivative Traders, lots of defendants facing securities suits have been trying to use the decision as a get-out-of-jail free card. In Janus, as you might recall, a 5-4 court held that only the actual “maker” of a statement can be liable under Section 10(b) of the ’34 Act. As result, defendants in securities suits now routinely argue that they didn’t “make” the allegedly misleading statement. Courts are just beginning to address these claims, with mixed results.
On Friday, Oakland U.S. district judge Claudia Wilken rebuffed the Janus arguments made by two former sales executives at Hansen Medical Inc., and refused to dismiss the SEC’s charges that the two engaged in a scheme to defraud investors. She also greenlighted many of the claims in a parallel shareholder suit against Hansen Medical and four individuals.
Her ruling in the SEC case is here, and her ruling in the class action case is here.
