When Is A Cautionary Statement Not Meaningful?

Law360, New York (March 24, 2010, 5:09 PM EDT) -- According to the U.S. Securities and Exchange Commission, forward-looking statements included within the Management's Discussion and Analysis section of an issuer’s periodic reports filed under the Exchange Act are within the scope of the Private Securities Litigation Reform Act's safe harbor for forward-looking statements.

If, however, an issuer is aware that a “possible risk” is actually occurring, a warning related to that risk is not a meaningful cautionary statement that would be afforded protection by the PSLRA’s safe harbor.

Background

Seeking to reduce frivolous securities litigation,...
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