BY Gary Goettling
In what has been called one of the most important cases of its kind in a generation, the U.S. Supreme Court ruled Jan. 15 that companies cannot be held liable for violations of securities law committed by the companies with which they do business.
The decision also established a personal milestone in alumnus Oscar Persons' career. "This is clearly the very, very, very top," said Persons, IE 60, who earned a law degree from Emory in 1967. "It's so rare that a lawyer gets a case that's heard by the Supreme Court."
The case was also significant in terms of the attention it received in the business community, but particularly for the ramifications of the high court's decision, he added.
A partner with the firm of Alston & Bird, Persons was the lead attorney for the team representing Scientific Atlanta in Stoneridge Investment Partners v. Scientific Atlanta and Motorola.
The case came about after Charter Communications, a cable TV company, was charged with inflating its earnings reports and thereby misstating its financial position to investors. After settling their claim against Charter, unhappy investors went after Scientific Atlanta, alleging that the company participated in the scheme by selling digital cable converter boxes to Charter at higher-than-usual prices, then used the extra markup to purchase advertising on Charter's system.
From a legal standpoint, the issue boiled down to whether third-party suppliers with no disclosure or reporting obligations to investors could be held liable for the actions of the primary violator of the law.
The litigation, which started in 2003, worked its way up to the Supreme Court following disparate rulings by the U.S. Circuit Court of Appeals in the 5th, 8th and 9th districts.
"We got a 5-to-3 opinion, and it's really tight," said Persons, whose firm retained outside lawyers to conduct the oral argument before the Supreme Court. "There's no wiggle room in terms of its impact."
|
