Lorenzo e. SEC

 
Give your opinion on this case:
Case 2: Lorenzo e. SEC https://www.whitecase.com/publications/alert/lorenzo-v-sec-disseminating-false-information-can-create-rule-10b-5-liability
The Commission found that Lorenzo violated the Exchange act and the Securities act when he sent misleading and bogus information to investors for the purpose of defrauding them.  The Court is holding Lorenzo liable and their decision is going to give the SEC expand liability to other disseminators of corporate statements, such as employees of a company’s investor relations department, underwriters, and analysts.  I agree with the Court’s decision and the expansion of liability to hold all parties knowledgeable or a participant in any way in an attempt to defraud investors and/or companies accountable.  A similar precedent was set in Janus Capital Group, Inc. v. First Derivative Traders. In Janus Capital Group, Inc. v. First Derivative Traders, a split court decided that an individual who assisted in the drafting of a false statement that was later issued by a different individual was not “liable” as the maker of the statement.   That case only addressed the making of the statement.

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