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High Court Ruling On Direct Listing Appeal Could Be Pivotal

Member Douglas P. Baumstein spoke to Law360 about the Supreme Court's agreement to hear messaging company, Slack's appeal of an investor suit. Douglas commented on investor liability rules and shared, "The distinction is important, given that an IPO raises money for a company but secondary transactions do not. By eliminating the tracing requirement and expanding strict liability for direct offerings, the Ninth Circuit has implemented a scheme where the economic risks associated with a strict liability is shifted to the company, even where it receives no direct benefit."