Why Slack Decision Struck A Nerve With Corporate America

By John Browne and Lauren Ormsbee (November 4, 2021, 6:02 PM EDT) -- On Nov. 3, the defendants filed an aggressive petition for rehearing and rehearing en banc asking the U.S. Court of Appeals for the Ninth Circuit to reconsider its recent pro-investor decision in Pirani v. Slack Technologies Inc.

The Slack decision addressed an important issue of first impression: Do investors have standing to pursue Securities Act claims when a company makes material misrepresentations in connection with a direct listing initial public offering?

Direct listing IPOs are a new going-public alternative to traditional IPOs and have become increasingly popular in the wake of recent U.S. Securities and Exchange Commission regulatory changes. The Slack...

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