Digimarc: Raising Pleading Requirements

Law360, New York (January 29, 2009, 12:00 AM EST) -- The Ninth Circuit recently adopted and clarified a two-step analysis to determine the sufficiency of scienter allegations.

In doing so, it reaffirmed the strict federal pleading requirements for securities fraud cases, and confirmed that the totality of the circumstances inquiry mandated in Tellabs v. Makor Issues & Rights Ltd., 551 U.S. 308, 127 S. Ct. 2499 (2007) (“Tellabs”), is not an escape route for plaintiffs to avoid dismissal for failure to plead scienter as required.

Interpreting the U.S. Supreme Court’s decision in Tellabs, which resolved a...
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