Dorsey client NVE Corp, a nanotechnology company, recently secured the affirmance of the dismissal of a shareholder class action accusing NVE and its officers and directors of misrepresenting the prospects of its technology. As reported by Securities Law 360, the United States Court of Appeals for the Eighth Circuit affirmed the lower court’s dismissal because the shareholder plaintiffs failed to satisfy the requirements under the Private Securities Litigation Reform Act (PSLRA).
Dorsey partner Peter Carter, who represented NVE in the litigation, said he was pleased with the decision. "This ruling is consistent with what Congress intended when it put PSLRA into law. High-tech companies have volatile stock prices and anytime a stock price falls cannot give rise to a claim for fraud."
"8th Circ. Puts Kibosh on NVE Shareholders' Fraud Suit" was published by Securities Law 360.