Plain-English summary
Court unanimously holds Rule 10b‑5(b) does not permit liability for pure omissions
In Macquarie Infrastructure v. Moab Partners (No. 22‑1165), the Supreme Court unanimously held that SEC Rule 10b‑5(b) — which bars making untrue statements or omitting facts "necessary" to make statements not misleading — does not reach pure omissions unconnected to an affirmative statement. The Court vacated the Second Circuit judgment and remanded the case.
Why this matters
The decision narrows one way investors can bring securities-fraud claims. It limits Rule 10b‑5(b) suits to situations where an omission distorts an affirmative statement, rather than allowing liability for every failure to disclose material facts. That affects how plaintiffs frame securities fraud cases and how companies assess disclosure risks.
Who may feel it
- Public companies and their executives (disclosure obligations and litigation exposure)
- Investors and securities plaintiffs (theories and chances of recovery)
- Lawyers and litigants in securities class actions
- Regulators and the SEC (enforcement strategies)
Key questions
- Does SEC Rule 10b‑5(b) permit private lawsuits based on pure omissions (standalone failures to disclose) in connection with the purchase or sale of securities?