Warning

Info

Warning

Info

Warning

Info

LSDefine

Simple English definitions for legal terms

fraud-on-the-market principle

Read a random definition: antitrust law

A quick definition of fraud-on-the-market principle:

The fraud-on-the-market principle is a rule that says if someone buys a stock in a public market and the value of the stock is based on false information, they can sue for fraud even if they didn't know the information was false. This is because the market price of the stock reflects all available public information. However, this rule can be challenged. Fraud is when someone lies or hides important information to make someone else do something that hurts them. It can be a crime or a civil wrong.

A more thorough explanation:

Definition: The fraud-on-the-market principle is a legal doctrine that allows a plaintiff to establish reliance on a misstatement about a security's value without proving actual knowledge of the fraudulent statement. This is possible if the stock is purchased in an open and developed securities market. The doctrine recognizes that the market price of an issuer's stock reflects all available public information. The presumption is rebuttable.

Examples: If a company makes a false statement about its financial health, investors who purchased the company's stock in an open and developed securities market can sue the company for securities fraud. They can use the fraud-on-the-market principle to establish reliance on the false statement without proving that they knew the statement was false. The presumption is that the investors relied on the market price of the stock, which reflected the false statement. The company can rebut this presumption by showing that the investors did not rely on the false statement.

Explanation: The fraud-on-the-market principle is a legal tool that helps investors seek compensation for securities fraud. It recognizes that investors rely on the market price of a stock to make investment decisions. If a company makes a false statement that affects the stock price, investors who purchased the stock can sue the company for securities fraud. The fraud-on-the-market principle allows them to establish reliance on the false statement without proving that they knew the statement was false. This makes it easier for investors to seek compensation for securities fraud.

fraud on the community | frauds, statute of

Warning

Info

General

General chat about the legal profession.
main_chatroom
👍 Chat vibe: 0 👎
Help us make LSD better!
Tell us what's important to you
BulbasaurNoLikeCardio
18:26
I do not think we will see a wave until after thanksgiving. Adcoms will be nice and not ruin someones thanksgiving with an R
18:28
ruin my thanksgiving law schools uwu
PerpetualCheerfulBeaver
18:53
I really thought a texas schools wave was going to hit today...guess it will be December 1
7Rings
19:00
No news is good news 😜
PerpetualCheerfulBeaver
19:10
the mentality im embracing
ClassyPleasantHeron
19:23
You will see some A waves next week, just before Thanksgiving. Schools like to give people things to talk about over the holidays.
19:26
my predict monday berk from earlier td
snow
19:33
Oregon decision rendered…
snow
19:33
Bro why don’t they just tell me lol
damn ive been under review for a month and no movement, when did u apply snow?
snow
19:39
The day apps opened. I still don’t know what the decision is tho lol
Dang. Crossing my fingers for you!!
snow
19:41
Thank you!!
shaquilleoatmeal
19:44
Snow dude wtf you been
snow
19:46
Working! I was prepping for a trial but it got reset!
snow
19:47
Have you don your gulc interview?
JumpySubsequentDolphin
19:47
@snow: snow!!!! I’m in Oregon should I break into admissions office and demand your decision be sent
shaquilleoatmeal
19:49
Better to be prepared than not, otherwise it always happens when you don’t prep
shaquilleoatmeal
19:50
Yea did it a week and half ago, told us we won’t hear anything until end of December if we’re lucky, most likely first week of jan
shaquilleoatmeal
19:50
Said no one works after Monday this week and no one works week of Christmas
shaquilleoatmeal
19:50
So holiday takes time away from app review
snow
19:54
True @shaq and do it jumpy!!
20:06
Hi everyone! Decided a bit too late that I wanted to go into law. GPA currently stands at 3.76 (one more semester to go) and I'm interested in going into immigration law. Anybody got any advice for LSAT studying and applications? I plan on taking a gap year to have some time for internships and such :)
snow
20:08
Apply for the LSAT fee waiver to try to mitigate the cost of materials! 7Sage is $1 for a year if you have the fee waiver. I also think you should try to work in an immigration firm in some way to see if it’s something you really want to pursue and to add to your resume. Good luck!!! One tip I would also give is to not sign up for the LSAT until you’re practice tests average are around the score you’re aiming for
snow
20:08
Your*
snow
20:08
You got this! :)
madollyy
20:09
thank you snow <3
Dkk
20:15
@madollyy: use LSAT Demon!
Dkk
20:16
Watch their youtube channel too
madollyy
20:23
Would an internship through CHCI help my application as well?
LSD+ is ad-free, with DMs, discounts, case briefs & more.