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The Stoneridge case – much ado about nothing?

Andrew Edison (Partner at Bracewell & Giuliani LLP, Houston, Texas, USA.)

Journal of Investment Compliance

ISSN: 1528-5812

Article publication date: 14 March 2008




The purpose of this paper is to explain the issues related to “scheme liability” that underlie the current case before the United States Supreme Court, Stoneridge Investment Partners v. Scientific‐Atlanta and Motorola.


Explains the facts of the Stoneridge case; explains the legal framework, including ongoing debates over the scope of liability under Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b‐5, the Supreme Court's decision in Central Bank, N.A. v. First Interstate Bank, development of the “scheme liability” concept by various plaintiffs' lawyers, and three circuit court decisions related to scheme liability; and the philosophy that is likely to guide the Supreme Court in Stoneridge.


The Stoneridge case provides the Supreme Court with the unique opportunity to clarify the limits of liability under Section 10(b) and Rule 10b‐5. It is the first time since Central Bank that the Supreme Court will grapple with the contours of liability for so‐called secondary actors.


A clear explanation of the issues in a highly visible Supreme Court case by an experienced commercial litigator.



Edison, A. (2008), "The Stoneridge case – much ado about nothing?", Journal of Investment Compliance, Vol. 9 No. 1, pp. 5-9.



Emerald Group Publishing Limited

Copyright © 2008, Emerald Group Publishing Limited

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