Split 9th Circ. Resets VW Bondholder Emissions Fraud Row

By Linda Chiem (June 25, 2021, 7:40 PM EDT) -- A split Ninth Circuit on Friday reversed a California district court's decision keeping alive claims Volkswagen duped a pension fund into buying overpriced bonds by not mentioning its emissions-cheating scandal in offering documents, clarifying the narrow scope of a key reliance standard in securities fraud cases.

In a 2-1 ruling, the Ninth Circuit said U.S. District Judge Charles Breyer should not have denied Volkswagen AG's summary judgment bid in a long-running suit from lead plaintiff Puerto Rico Government Employees and Judiciary Retirement Systems Administration. The panel's majority determined that the pension fund's allegations couldn't be characterized primarily as claims of omission,...

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