Einhorn Moves Markets, But Not Securities Fraud Suits

Law360, New York (March 20, 2013, 8:31 PM EDT) -- Celebrity investors like David Einhorn have the power to cripple a company’s stock price merely by offering opinions, but their statements may play a diminished role in securities fraud class actions after a precedential Eleventh Circuit decision last month, experts say.

The appeals court ruled Feb. 25 that Einhorn’s negative presentation on The St. Joe Co. could not form the basis of a securities fraud suit by the Florida real estate firm’s investors. The company’s stock price plummeted in the wake of the presentation, but the...
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