Granting defendants’ motion to dismiss plaintiff’s securities fraud class action claim, a federal district court held that plaintiffs failed to adequately plead loss causation because their shares in defendants’ company lost value before, not after, the truth regarding defendants’ purported misrepresentations were publicly disclosed. The Court explained that to adequately plead a securities fraud claim, a plaintiff must, among other things, allege that that the defendant’s misrepresentations “proximately caused” plaintiff’s losses. Here, the plaintiffs’ own allegations fatally undermined their theory of loss causation. Because the Complaint alleged that defendants continued to conceal the truth of their wrongdoing from the public at the time plaintiff’s share prices fell, the Court determined that the losses arising from the decrease could not have been caused by the market’s reaction to learning the truth about defendants’ improper activity. As a result, the Court held that plaintiffs had failed to state a valid cause of action. (Powell v. Idacorp, 2007 WL 1498881 (D. Ida. May 21, 2007)) Circuit Court Affirms Refusal to Enforce International Arbitration Award
Finding that appellant failed to present the necessary “extraordinary circumstances” required in order for a United States court to set aside a foreign judgment on public policy grounds, the Court of Appeals for the District of Columbia Circuit refused to enforce a $60,000,000 arbitration award that had been entered by an ICC arbitration panel in Columbia and, thereafter, nullified by Colombia’s highest administrative court. Appellant argued that the Colombian court had ignored both Colombian and international law in nullifying the award.
The Circuit Court rejected this argument, finding, among other things, that there was nothing in the record to indicate that the proceedings before the Columbian court were “tainted” or that the judgment was not authentic. While the Circuit Court recognized that foreign judgments need not be enforced if they offend “public policy,” the occasions where courts apply this rule are limited to instances where the foreign judgment is so “repugnant” as to enable the Court to conclude that the decision is contrary “to fundamental notions of what is decent and just in the United States.” Because the appellants failed to meet this demanding standard, the Circuit Court affirmed the district court’s dismissal of the lawsuit. (Termorio S.A. E.S.P. v. Electranta S.P., 2007 WL 1515069 (D.C. Cir. May 25, 2007))