Bush Hopes to Limit Private Securities Fraud Litigation
The Supreme Court will decide "whether investors can pursue lawsuits to recover investment losses if they can prove collusion between Wall Street institutions and scandal-ridden companies." Seems like a no-brainer that investors should be entitled to sue the entities that helped defraud them, right? Not to the Decider.
"We think the SEC is the right entity to bring those lawsuits and make sure investors are protected," [economic advisor Al] Hubbard said in describing the president's views. "We are in a society that is overly litigious and it's very harmful to society, very harmful to investors."
The president wants to curb "unnecessary lawsuits," with "unnecessary" evidently defined as any lawsuit he doesn't personally authorize. The SEC disagrees.
The Securities and Exchange Commission voted 3-2 to ask the solicitor general to support shareholders in the pending court case.
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