(Slip Opinion) OCTOBER TERM, 2010 1 

Syllabus 

NOTE: Where it is feasible, a syllabus (headnote) will be released, as is

being done in connection with this case, at the time the opinion is issued.

The syllabus constitutes no part of the opinion of the Court but has been

prepared by the Reporter of Decisions for the convenience of the reader. 

See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337. 

SUPREME COURT OF THE UNITED STATES 

Syllabus 

JANUS CAPITAL GROUP, INC., ET AL. v. FIRST 

DERIVATIVE TRADERS 

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR 

THE FOURTH CIRCUIT 

No. 09–525. Argued December 7, 2010—Decided June 13, 2011 

Respondent First Derivative Traders (First Derivative), representing a

class of stockholders in petitioner Janus Capital Group, Inc. (JCG), 

filed this private action under Securities and Exchange Commission

(SEC) Rule 10b–5, which forbids “any person . . . [t]o make any untrue statement of a material fact” in connection with the purchase or

sale of securities. The complaint alleged, inter alia, that JCG and its 

wholly owned subsidiary, petitioner Janus Capital Management LLC 

(JCM), made false statements in mutual fund prospectuses filed by

Janus Investment Fund—for which JCM was the investment adviser 

and administrator—and that those statements affected the price of

JCG’s stock. Although JCG created Janus Investment Fund, it is a

separate legal entity owned entirely by mutual fund investors. The 

District Court dismissed the complaint for failure to state a claim.

The Fourth Circuit reversed, holding that First Derivative had sufficiently alleged that JCG and JCM, by participating in the writing

and dissemination of the prospectuses, made the misleading statements contained in the documents. Before this Court, First Derivative continues to argue that JCM made the statements but seeks to

hold JCG liable only as a control person of JCM under §20(a). 

Held: Because the false statements included in the prospectuses were

made by Janus Investment Fund, not by JCM, JCM and JCG cannot

be held liable in a private action under Rule 10b–5. Pp. 5–12.

(a) Although neither Rule 10b–5 nor the statute it interprets,

§10(b) of the Act, expressly creates a private right of action, such an 

“action is implied under §10(b).” Superintendent of Ins. of N. Y. v. 

Bankers Life & Casualty Co., 404 U. S. 6, 13, n. 9. That holding “remains the law,” Stoneridge Investment Partners, LLC v. Scientific-
2 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Syllabus 

Atlanta, Inc., 552 U. S. 148, 165, but, in analyzing the question at issue, the Court is mindful that it must give “narrow dimensions . . . to 

a right . . . Congress did not authorize when it first enacted the statute and did not expand when it revisited” it, id., at 167. Pp. 5–10.

(1) For Rule 10b–5 purposes, the maker of a statement is the

person or entity with ultimate authority over the statement, including its content and whether and how to communicate it. Without 

control, a person or entity can merely suggest what to say, not 

“make” a statement in its own right. This rule follows from Central 

Bank of Denver, N. A. v. First Interstate Bank of Denver, N. A., 511 

U. S. 164, 180, which held that Rule 10b–5’s private right of action

does not include suits against aiders and abettors who contribute

“substantial assistance” to the making of a statement but do not actually make it. Reading “make” more broadly, to include persons or

entities lacking ultimate control over a statement, would substantially undermine Central Bank by rendering aiders and abettors almost nonexistent. The Court’s interpretation is also suggested by 

Stoneridge, 552 U. S., at 161, and accords with the narrow scope that 

must be given the implied private right of action, id., at 167. Pp. 6–8.

(2) The Court rejects the Government’s contention that “make” 

should be defined as “create,” thereby allowing private plaintiffs to

sue a person who provides the false or misleading information that 

another person puts into a statement. Adopting that definition would

be inconsistent with Stoneridge, supra, at 161, which rejected a private Rule 10b–5 suit against companies involved in deceptive transactions, even when information about those transactions was later 

incorporated into false public statements. First Derivative notes the 

uniquely close relationship between a mutual fund and its investment adviser, but the corporate formalities were observed, and reapportionment of liability in light of this close relationship is properly 

the responsibility of Congress, not the courts. Furthermore, First 

Derivative’s rule would read into Rule 10b–5 a theory of liability

similar to—but broader than—control-person liability under §20(a). 

Pp. 8–10.

(b) Although JCM may have been significantly involved in preparing the prospectuses, it did not itself “make” the statements at issue

for Rule 10b–5 purposes. Its assistance in crafting what was said

was subject to Janus Investment Fund’s ultimate control. Pp. 10–12. 

566 F. 3d 111, reversed. 

THOMAS, J., delivered the opinion of the Court, in which ROBERTS, 

C. J., and SCALIA, KENNEDY, and ALITO, JJ., joined. BREYER, J., filed a 

dissenting opinion, in which GINSBURG, SOTOMAYOR, and KAGAN, JJ., 

joined. 
_________________ 

_________________ 

Cite as: 564 U. S. ____ (2011) 1 

Opinion of the Court 

NOTICE: This opinion is subject to formal revision before publication in the

preliminary print of the United States Reports. Readers are requested to

notify the Reporter of Decisions, Supreme Court of the United States, Washington, D. C. 20543, of any typographical or other formal errors, in order

that corrections may be made before the preliminary print goes to press. 

SUPREME COURT OF THE UNITED STATES 

No. 09–525 

JANUS CAPITAL GROUP, INC., ET AL., PETITIONERS 

v. FIRST DERIVATIVE TRADERS 

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE FOURTH CIRCUIT

[June 13, 2011] 

JUSTICE THOMAS delivered the opinion of the Court. 

This case requires us to determine whether Janus Capital Management LLC (JCM), a mutual fund investment 

adviser, can be held liable in a private action under Securities and Exchange Commission (SEC) Rule 10b–5 for 

false statements included in its client mutual funds’ prospectuses. Rule 10b–5 prohibits “mak[ing] any untrue 

statement of a material fact” in connection with the purchase or sale of securities. 17 CFR §240.10b–5 (2010). We 

conclude that JCM cannot be held liable because it did not 

make the statements in the prospectuses. 

I 

Janus Capital Group, Inc. (JCG), is a publicly traded 

company that created the Janus family of mutual funds. 

These mutual funds are organized in a Massachusetts

business trust, the Janus Investment Fund. Janus Investment Fund retained JCG’s wholly owned subsidiary,

JCM, to be its investment adviser and administrator. JCG 

and JCM are the petitioners here.

Although JCG created Janus Investment Fund, Janus

Investment Fund is a separate legal entity owned entirely 
2 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

by mutual fund investors. Janus Investment Fund has no 

assets apart from those owned by the investors. JCM 

provides Janus Investment Fund with investment advisory services, which include “the management and administrative services necessary for the operation of [Janus]

Fun[d],” App. 225a, but the two entities maintain legal 

independence. At all times relevant to this case, all of 

the officers of Janus Investment Fund were also officers of 

JCM, but only one member of Janus Investment Fund’s 

board of trustees was associated with JCM. This is more 

independence than is required: By statute, up to 60 percent of the board of a mutual fund may be composed of

“interested persons.” See 54 Stat. 806, as amended, 15 

U. S. C. §80a–10(a); see also 15 U. S. C. A. §80a–2(a)(19) 

(2009 ed. and Feb. 2011 Supp.) (defining “interested 

person”).

As the securities laws require, Janus Investment Fund 

issued prospectuses describing the investment strategy

and operations of its mutual funds to investors. See 15 

U. S. C. §§77b(a)(10), 77e(b)(2), 80a–8(b), 80a–2(a)(31), 

80a–29(a)–(b). The prospectuses for several funds represented that the funds were not suitable for market timing 

and can be read to suggest that JCM would implement

policies to curb the practice.1 For example, the Janus 

—————— 

1Market timing is a trading strategy that exploits time delay in mutual funds’ daily valuation system. The price for buying or selling

shares of a mutual fund is ordinarily determined by the next net asset

value (NAV) calculation after the order is placed. The NAV calculation 

usually happens once a day, at the close of the major U. S. markets.

Because of certain time delays, however, the values used in these 

calculations do not always accurately reflect the true value of the 

underlying assets. For example, a fund may value its foreign securities

based on the price at the close of the foreign market, which may have 

occurred several hours before the calculation. But events might have

taken place after the close of the foreign market that could be expected

to affect their price. If the event were expected to increase the price of 

the foreign securities, a market-timing investor could buy shares of a 
Cite as: 564 U. S. ____ (2011) 3 

Opinion of the Court 

Mercury Fund prospectus dated February 25, 2002, stated 

that the fund was “not intended for market timing or

excessive trading” and represented that it “may reject any

purchase request . . . if it believes that any combination of 

trading activity is attributable to market timing or is

otherwise excessive or potentially disruptive to the Fund.” 

App. 141a. Although market timing is legal, it harms 

other investors in the mutual fund. 

In September 2003, the Attorney General of the State of 

New York filed a complaint against JCG and JCM alleging 

that JCG entered into secret arrangements to permit

market timing in several funds run by JCM. After the 

complaint’s allegations became public, investors withdrew

significant amounts of money from the Janus Investment 

Fund mutual funds.2 Because Janus Investment Fund 

compensated JCM based on the total value of the funds 

and JCM’s management fees comprised a significant

percentage of JCG’s income, Janus Investment Fund’s loss 

of value affected JCG’s value as well. JCG’s stock price

fell nearly 25 percent, from $17.68 on September 2 to 

$13.50 on September 26.

Respondent First Derivative Traders (First Derivative) 

represents a class of plaintiffs who owned JCG stock as of

September 3, 2003. Its complaint asserts claims against

JCG and JCM for violations of Rule 10b–5 and §10(b) of 

the Securities Exchange Act of 1934, 48 Stat. 891, as

amended, 15 U. S. C. §78j(b). First Derivative alleges that

JCG and JCM “caused mutual fund prospectuses to be

issued for Janus mutual funds and made them available to 

—————— 

mutual fund at the artificially low NAV and sell the next day when the 

NAV corrects itself upward. See Disclosure Regarding Market Timing

and Selective Disclosure of Portfolio Holdings, 68 Fed. Reg. 70402

(proposed Dec. 17, 2003). 2 In 2004, JCG and JCM settled these allegations and agreed to reduce their fees by $125 million and pay $50 million in civil penalties

and $50 million in disgorgement to the mutual fund investors. 
4 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

the investing public, which created the misleading impression that [JCG and JCM] would implement measures to 

curb market timing in the Janus [mutual funds].” App. to 

Pet. for Cert. 60a. “Had the truth been known, Janus 

[mutual funds] would have been less attractive to investors, and consequently, [JCG] would have realized lower 

revenues, so [JCG’s] stock would have traded at lower 

prices.” Id., at 72a. 

First Derivative contends that JCG and JCM “materially misled the investing public” and that class members

relied “upon the integrity of the market price of [JCG] 

securities and market information relating to [JCG and

JCM].” Id., at 109a. The complaint also alleges that JCG

should be held liable for the acts of JCM as a “controlling 

person” under 15 U. S. C. A. §78t(a) (Feb. 2011 Supp.) 

(§20(a) of the Act).

The District Court dismissed the complaint for failure to

state a claim.3 In re Mutual Funds Inv. Litigation, 487 

F. Supp. 2d 618, 620 (D Md. 2007). The Court of Appeals 

for the Fourth Circuit reversed, holding that First Derivative had sufficiently alleged that “JCG and JCM, by participating in the writing and dissemination of the prospectuses, made the misleading statements contained in the 

documents.” In re Mutual Funds Inv. Litigation, 566 F. 3d 

111, 121 (2009) (emphasis in original). With respect to the 

element of reliance, the court found that investors would 

infer that JCM “played a role in preparing or approving 

the content of the Janus fund prospectuses,” id., at 127, 

but that investors would not infer the same about JCG, 

—————— 

3The elements of a private action under Rule 10b–5 are “(1) a material misrepresentation or omission by the defendant; (2) scienter; (3) a 

connection between the misrepresentation or omission and the purchase or sale of a security; (4) reliance upon the misrepresentation or

omission; (5) economic loss; and (6) loss causation.” Stoneridge Investment Partners, LLC v. Scientific-Atlanta, Inc., 552 U. S. 148, 157 

(2008). 
Cite as: 564 U. S. ____ (2011) 5 

Opinion of the Court 

which could be liable only as a “control person” of JCM

under §20(a). Id., at 128, 129–130. 

II 

We granted certiorari to address whether JCM can be

held liable in a private action under Rule 10b–5 for false

statements included in Janus Investment Fund’s prospectuses. 561 U. S. ___ (2010). Under Rule 10b–5, it is

unlawful for “any person, directly or indirectly, . . . [t]o

make any untrue statement of a material fact” in connection with the purchase or sale of securities. 17 CFR 

§240.10b–5(b).4 To be liable, therefore, JCM must have 

“made” the material misstatements in the prospectuses.

We hold that it did not.5 

A 

The SEC promulgated Rule 10b–5 pursuant to authority 

granted under §10(b) of the Securities Exchange Act of

1934, 15 U. S. C. §78j(b). Although neither Rule 10b–5

nor §10(b) expressly creates a private right of action, this 

Court has held that “a private right of action is implied

under §10(b).” Superintendent of Ins. of N. Y. v. Bankers 

Life & Casualty Co., 404 U. S. 6, 13, n. 9 (1971). That

holding “remains the law,” Stoneridge Investment Part-

—————— 

4Rule 10b–5 makes it “unlawful for any person, directly or indirectly, 

by the use of any means or instrumentality of interstate commerce, or

of the mails or of any facility of any national securities exchange, . . . 

[t]o make any untrue statement of a material fact or to omit to state a 

material fact necessary in order to make the statements made, in the 

light of the circumstances under which they were made, not misleading

. . . .” 17 CFR §240.10b–5(b). 5Although First Derivative argued below that JCG violated Rule 

10b–5 by making the statements in the prospectuses, it now seeks to

hold JCG liable solely as a control person of JCM under §20(a). The 

only question we must answer, therefore, is whether JCM made the

misstatements. Whether First Derivative has stated a claim against

JCG as a control person depends on whether it has stated a claim

against JCM. 
6 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

ners, LLC v. Scientific-Atlanta, Inc., 552 U. S. 148, 165 

(2008), but “[c]oncerns with the judicial creation of a private cause of action caution against its expansion,” ibid. 

Thus, in analyzing whether JCM “made” the statements 

for purposes of Rule 10b–5, we are mindful that we must

give “narrow dimensions . . . to a right of action Congress

did not authorize when it first enacted the statute and did 

not expand when it revisited the law.” Id., at 167. 

1 

One “makes” a statement by stating it. When “make” is 

paired with a noun expressing the action of a verb, the 

resulting phrase is “approximately equivalent in sense” to

that verb. 6 Oxford English Dictionary 66 (def. 59) (1933)

(hereinafter OED); accord, Webster’s New International

Dictionary 1485 (def. 43) (2d ed. 1934) (“Make followed by

a noun with the indefinite article is often nearly equivalent to the verb intransitive corresponding to that noun”). 

For instance, “to make a proclamation” is the approximate

equivalent of “to proclaim,” and “to make a promise” approximates “to promise.” See 6 OED 66 (def. 59). The 

phrase at issue in Rule 10b–5, “[t]o make any . . . statement,” is thus the approximate equivalent of “to state.” 

For purposes of Rule 10b–5, the maker of a statement is 

the person or entity with ultimate authority over the

statement, including its content and whether and how to

communicate it. Without control, a person or entity can

merely suggest what to say, not “make” a statement in its 

own right. One who prepares or publishes a statement on 

behalf of another is not its maker. And in the ordinary 

case, attribution within a statement or implicit from surrounding circumstances is strong evidence that a statement was made by—and only by—the party to whom it is

attributed. This rule might best be exemplified by the 

relationship between a speechwriter and a speaker. Even 

when a speechwriter drafts a speech, the content is en-
Cite as: 564 U. S. ____ (2011) 7 

Opinion of the Court 

tirely within the control of the person who delivers it. And 

it is the speaker who takes credit—or blame—for what is 

ultimately said.

This rule follows from Central Bank of Denver, N. A. v. 

First Interstate Bank of Denver, N. A., 511 U. S. 164 

(1994), in which we held that Rule 10b–5’s private right of

action does not include suits against aiders and abettors.

See id., at 180. Such suits—against entities that contribute “substantial assistance” to the making of a statement 

but do not actually make it—may be brought by the SEC, 

see 15 U. S. C. A. §78t(e), but not by private parties. A 

broader reading of “make,” including persons or entities 

without ultimate control over the content of a statement, 

would substantially undermine Central Bank. If persons 

or entities without control over the content of a statement 

could be considered primary violators who “made” the 

statement, then aiders and abettors would be almost 

nonexistent.6 

This interpretation is further supported by our recent

decision in Stoneridge. There, investors sued “entities 

who, acting both as customers and suppliers, agreed to

arrangements that allowed the investors’ company to 

mislead its auditor and issue a misleading financial 

statement.” 552 U. S., at 152–153. We held that dismissal of the complaint was proper because the public 

—————— 

6The dissent correctly notes that Central Bank involved secondary,

not primary, liability. Post, at 4 (opinion of BREYER, J.). But for Central Bank to have any meaning, there must be some distinction between those who are primarily liable (and thus may be pursued in 

private suits) and those who are secondarily liable (and thus may not 

be pursued in private suits).

We draw a clean line between the two—the maker is the person or

entity with ultimate authority over a statement and others are not. In 

contrast, the dissent’s only limit on primary liability is not much of a

limit at all. It would allow for primary liability whenever “[t]he specific

relationships alleged . . . warrant [that] conclusion”—whatever that 

may mean. Post, at 11. 
8 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

could not have relied on the entities’ undisclosed deceptive 

acts. Id., at 166–167. Significantly, in reaching that

conclusion we emphasized that “nothing [the defendants] 

did made it necessary or inevitable for [the company] to 

record the transactions as it did.” Id., at 161.7 This emphasis suggests the rule we adopt today: that the maker of

a statement is the entity with authority over the content

of the statement and whether and how to communicate it. 

Without such authority, it is not “necessary or inevitable”

that any falsehood will be contained in the statement. 

Our holding also accords with the narrow scope that we

must give the implied private right of action. Id., at 167. 

Although the existence of the private right is now settled,

we will not expand liability beyond the person or entity 

that ultimately has authority over a false statement. 

2 

The Government contends that “make” should be defined as “create.” Brief for United States as Amicus Curiae 14–15 (citing Webster’s New International Dictionary 

1485 (2d ed. 1958) (defining “make” as “[t]o cause to exist, 

appear, or occur”)). This definition, although perhaps

appropriate when “make” is directed at an object unassociated with a verb (e.g., “to make a chair”), fails to capture

its meaning when directed at an object expressing the 

action of a verb. 

 Adopting the Government’s definition of “make” would 

also lead to results inconsistent with our precedent. The 

Government’s definition would permit private plaintiffs to

sue a person who “provides the false or misleading information that another person then puts into the statement.” 

—————— 

7We agree that “no one in Stoneridge contended that the equipment 

suppliers were, in fact, the makers of the cable company’s misstatements.” Post, at 8. If Stoneridge had addressed whether the equipment

suppliers were “makers,” today’s decision would be unnecessary. The 

point is that Stoneridge’s analysis suggests that they were not. 
Cite as: 564 U. S. ____ (2011) 9 

Opinion of the Court 

Brief for United States as Amicus Curiae 13.8 But in 

Stoneridge, we rejected a private Rule 10b–5 suit against 

companies involved in deceptive transactions, even when

information about those transactions was later incorporated into false public statements. 552 U. S., at 161. We 

see no reason to treat participating in the drafting of a

false statement differently from engaging in deceptive

transactions, when each is merely an undisclosed act 

preceding the decision of an independent entity to make a 

public statement.

For its part, First Derivative suggests that the “wellrecognized and uniquely close relationship between a

mutual fund and its investment adviser” should inform 

our decision. Brief for Respondent 21. It suggests that an

investment adviser should generally be understood to be

the “maker” of statements by its client mutual fund, like

a playwright whose lines are delivered by an actor. We 

decline this invitation to disregard the corporate form. 

Although First Derivative and its amici persuasively

argue that investment advisers exercise significant influ-

—————— 

8Because we do not find the meaning of “make” in Rule 10b–5 to be

ambiguous, we need not consider the Government’s assertion that we 

should defer to the SEC’s interpretation of the word elsewhere. Brief 

for United States as Amicus Curiae 13 (citing Brief for SEC as Amicus 

Curiae in Pacific Inv. Mgmt. Co. LLC v. Mayer Brown LLP, No. 09– 

1619 (CA2), p. 7); see Christensen v. Harris County, 529 U. S. 576, 588 

(2000). We note, however, that we have previously expressed skepticism over the degree to which the SEC should receive deference regarding the private right of action. See Piper v. Chris-Craft Industries, Inc., 

430 U. S. 1, 41, n. 27 (1977) (noting that the SEC’s presumed expertise 

“is of limited value” when analyzing “whether a cause of action should

be implied by judicial interpretation in favor of a particular class of

litigants”). This also is not the first time this Court has disagreed with

the SEC’s broad view of §10(b) or Rule 10b–5. See, e.g., Central Bank of 

Denver, N. A. v. First Interstate Bank of Denver, N. A., 511 U. S. 164, 

188–191 (1994); Dirks v. SEC, 463 U. S. 646, 666, n. 27 (1983); Ernst & 

Ernst v. Hochfelder, 425 U. S. 185, 207 (1976); Blue Chip Stamps v. 

Manor Drug Stores, 421 U. S. 723, 746, n. 10 (1975). 
10 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

ence over their client funds, see Jones v. Harris Associates 

L. P., 559 U. S. ___, ___ (2010) (slip op., at 1–2), it is undisputed that the corporate formalities were observed

here. JCM and Janus Investment Fund remain legally 

separate entities, and Janus Investment Fund’s board of 

trustees was more independent than the statute requires.

15 U. S. C. §80a–10.9 Any reapportionment of liability in

the securities industry in light of the close relationship

between investment advisers and mutual funds is properly 

the responsibility of Congress and not the courts. Moreover, just as with the Government’s theory, First Derivative’s rule would create the broad liability that we rejected 

in Stoneridge. 

Congress also has established liability in §20(a) for 

“[e]very person who, directly or indirectly, controls any

person liable” for violations of the securities laws. 15 

U. S. C. A. §78t(a). First Derivative’s theory of liability

based on a relationship of influence resembles the liability 

imposed by Congress for control. To adopt First Derivative’s theory would read into Rule 10b–5 a theory of liability similar to—but broader in application than, see post, at 

9—what Congress has already created expressly elsewhere.10 We decline to do so. 

B 

Under this rule, JCM did not “make” any of the state-

—————— 

9Nor does First Derivative contend that any statements made by

JCM to Janus Investment Fund were “public statements” for the 

purposes of Basic Inc. v. Levinson, 485 U. S. 224, 227–228 (1988). We 

do not address whether and in what circumstances statements would 

qualify as “public.” Cf. post, at 12–13 (citing cases involving liability for 

statements made to analysts); In re Aetna, Inc. Securities Litigation, 

617 F. 3d 272, 275–277 (CA3 2010) (involving allegations that defendants “publicly tout[ed]” falsities on analyst conference calls). 10We do not address whether Congress created liability for entities 

that act through innocent intermediaries in 15 U. S. C. A. §78t(b). See 

Tr. of Oral Arg. 6, 61. 
Cite as: 564 U. S. ____ (2011) 11 

Opinion of the Court 

ments in the Janus Investment Fund prospectuses; Janus

Investment Fund did. Only Janus Investment Fund—not 

JCM—bears the statutory obligation to file the prospectuses with the SEC. 15 U. S. C. §§77e(b)(2), 80a–8(b), 

80a–29(a)–(b); see also 17 CFR §230.497 (imposing requirements on “investment companies”). The SEC has 

recorded that Janus Investment Fund filed the prospectuses. See JIF Group1 Standalone Prospectuses (Feb. 25, 

2002), online at http://www.sec.gov/Archives/edgar/data/ 

277751/000027775102000049/0000277751-02-000049.txt 

(as visited June 10, 2011, and available in Clerk of Court’s

case file) (recording the “Filer” of the Janus Mercury Fund 

prospectus as “Janus Investment Fund”). There is no 

allegation that JCM in fact filed the prospectuses and

falsely attributed them to Janus Investment Fund. Nor 

did anything on the face of the prospectuses indicate that

any statements therein came from JCM rather than Janus

Investment Fund—a legally independent entity with its 

own board of trustees.11 

—————— 

11First Derivative suggests that “indirectly” in Rule 10b–5 may 

broaden the meaning of “make.” We disagree. The phrase “directly or 

indirectly” is set off by itself in Rule 10b–5 and modifies not just “to

make,” but also “to employ” and “to engage.” We think the phrase 

merely clarifies that as long as a statement is made, it does not matter 

whether the statement was communicated directly or indirectly to the

recipient. A different understanding of “indirectly” would, like a broad 

definition of “make,” threaten to erase the line between primary violators and aiders and abettors established by Central Bank. 

In this case, we need not define precisely what it means to communicate a “made” statement indirectly because none of the statements in

the prospectuses were attributed, explicitly or implicitly, to JCM.

Without attribution, there is no indication that Janus Investment Fund 

was quoting or otherwise repeating a statement originally “made” by

JCM. Cf. Anixter v. Home-Stake Production Co., 77 F. 3d 1215, 1220, and 

n. 4 (CA10 1996) (quoting a signed “ ‘Auditor’s Report’” included in a prospectus); Basic, supra, at 227, n. 4 (quoting a news item reporting a statement by Basic’s president). More may be required to find that a person

or entity made a statement indirectly, but attribution is necessary. 
12 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

Opinion of the Court 

First Derivative suggests that both JCM and Janus

Investment Fund might have “made” the misleading

statements within the meaning of Rule 10b–5 because

JCM was significantly involved in preparing the prospectuses. But this assistance, subject to the ultimate control 

of Janus Investment Fund, does not mean that JCM 

“made” any statements in the prospectuses. Although 

JCM, like a speechwriter, may have assisted Janus Investment Fund with crafting what Janus Investment 

Fund said in the prospectuses, JCM itself did not “make”

those statements for purposes of Rule 10b–5.12 

* * * 

The statements in the Janus Investment Fund prospectuses were made by Janus Investment Fund, not by JCM.

Accordingly, First Derivative has not stated a claim 

against JCM under Rule 10b–5. The judgment of the

United States Court of Appeals for the Fourth Circuit is

reversed. 

It is so ordered. 

—————— 

12That JCM provided access to Janus Investment Fund’s prospectuses on its Web site is also not a basis for liability. Merely hosting a 

document on a Web site does not indicate that the hosting entity adopts

the document as its own statement or exercises control over its content. 

Cf. United States v. Ware, 577 F. 3d 442, 448 (CA2 2009) (involving the 

issuance of false press releases through innocent companies). In doing 

so, we do not think JCM made any of the statements in Janus Investment Fund’s prospectuses for purposes of Rule 10b–5 liability, just as

we do not think that the SEC “makes” the statements in the many

prospectuses available on its Web site. 
_________________ 

_________________ 

Cite as: 564 U. S. ____ (2011) 1 

BREYER, J., dissenting 

SUPREME COURT OF THE UNITED STATES 

No. 09–525 

JANUS CAPITAL GROUP, INC., ET AL., PETITIONERS 

v. FIRST DERIVATIVE TRADERS 

ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF

APPEALS FOR THE FOURTH CIRCUIT

[June 13, 2011] 

JUSTICE BREYER, with whom JUSTICE GINSBURG, 

JUSTICE SOTOMAYOR, and JUSTICE KAGAN join, dissenting. 

This case involves a private Securities and Exchange

Commission (SEC) Rule 10b–5 action brought by a group 

of investors against Janus Capital Group, Inc., and Janus

Capital Management LLC (Janus Management), a firm

that acted as an investment adviser to a family of mutual 

funds (collectively, the Janus Fund or Fund). The investors claim that Janus Management knowingly made materially false or misleading statements that appeared in 

prospectuses issued by the Janus Fund. They say that

they relied upon those statements, and that they suffered 

resulting economic harm.

Janus Management and the Janus Fund are closely 

related. Each of the Fund’s officers is a Janus Management employee. Janus Management, acting through those

employees (and other of its employees), manages the

purchase, sale, redemption, and distribution of the Fund’s

investments. Janus Management prepares, modifies, and

implements the Janus Fund’s long-term strategies. And 

Janus Management, acting through those employees,

carries out the Fund’s daily activities. 

Rule 10b–5 says in relevant part that it is unlawful for 

“any person, directly or indirectly . . . [t]o make any untrue

statement of a material fact” in connection with the pur­
2 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

BREYER, J., dissenting 

chase or sale of securities. 17 CFR §240.10b–5(b) (2010) 

(emphasis added). See also 15 U. S. C. §78j(b) (§10(b) of 

the Securities Exchange Act of 1934). The specific legal

question before us is whether Janus Management can be 

held responsible under the Rule for having “ma[d]e” certain false statements about the Janus Fund’s activities. 

The statements in question appear in the Janus Fund’s 

prospectuses.

The Court holds that only the Janus Fund, not Janus

Management, could have “ma[d]e” those statements. The 

majority points out that the Janus Fund’s board of trustees has “ultimate authority” over the content of the 

statements in a Fund prospectus. And in the majority’s

view, only “the person or entity with ultimate authority

over the statement, including its content and whether and

how to communicate it” can “make” a statement within the 

terms of Rule 10b–5. Ante, at 6. 

In my view, however, the majority has incorrectly interpreted the Rule’s word “make.” Neither common English 

nor this Court’s earlier cases limit the scope of that

word to those with “ultimate authority” over a statement’s 

content. To the contrary, both language and case law 

indicate that, depending upon the circumstances, a management company, a board of trustees, individual company 

officers, or others, separately or together, might “make”

statements contained in a firm’s prospectus—even if a

board of directors has ultimate content-related responsibility. And the circumstances here are such that a court 

could find that Janus Management made the statements 

in question. 

I 

Respondent’s complaint sets forth the basic elements

of a typical Rule 10b–5 “fraud on the market” claim. It 

alleges that Janus Management made statements that 

“created the misleading impression that” it “would 
Cite as: 564 U. S. ____ (2011) 3 

BREYER, J., dissenting 

implement measures to curb” a trading strategy called 

“market timing.” Second Amended Complaint ¶6 (hereinafter Complaint), App. to Pet. for Cert. 60a. The 

complaint adds that Janus Management knew that these 

“market timing” statements were false; that the 

statements were material; that the market, in pricing

securities (including related securities) relied upon the 

statements; that as a result, when the truth came out 

(that Janus Management indeed permitted “market 

timing” in the Janus Fund), the price of relevant shares 

fell; and the false statements thereby caused respondent 

significant economic losses. Complaint ¶¶4–10, id., at 

60a–63a. Cf. Stoneridge Investment Partners, LLC v. 

Scientific-Atlanta, Inc., 552 U. S. 148, 157 (2008) (identifying the elements of “a typical §10(b) private action”). 

The majority finds the complaint fatally flawed, 

however, because (1) Rule 10b–5 says that no “person”

shall “directly or indirectly . . . make any untrue statement

of a material fact,” (2) the statements at issue appeared in 

the Janus Fund’s prospectuses, and (3) only “the person or 

entity with ultimate authority over the statement, including its content and whether and how to communicate it”

can “make” a false statement. Ante, at 2–3, 5–6. 

But where can the majority find legal support for the

rule that it enunciates? The English language does not 

impose upon the word “make” boundaries of the kind the

majority finds determinative. Every day, hosts of corporate officials make statements with content that more 

senior officials or the board of directors have “ultimate 

authority” to control. So do cabinet officials make statements about matters that the Constitution places within

the ultimate authority of the President. So do thousands, 

perhaps millions, of other employees make statements 

that, as to content, form, or timing, are subject to the

control of another. 

Nothing in the English language prevents one from 
4 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

BREYER, J., dissenting 

saying that several different individuals, separately or

together, “make” a statement that each has a hand in

producing. For example, as a matter of English, one can 

say that a national political party has made a statement 

even if the only written communication consists of uniform

press releases issued in the name of local party branches; 

one can say that one foreign nation has made a statement

even when the officials of a different nation (subject to its

influence) speak about the matter; and one can say that

the President has made a statement even if his press

officer issues a communication, sometimes in the press 

officer’s own name. Practical matters related to context, 

including control, participation, and relevant audience,

help determine who “makes” a statement and to whom

that statement may properly be “attributed,” see ante, at 

11, n. 11—at least as far as ordinary English is concerned.

Neither can the majority find support in any relevant

precedent. The majority says that its rule “follows from 

Central Bank of Denver, N. A. v. First Interstate Bank of 

Denver, N. A., 511 U. S. 164 (1994),” in which the Court 

“held that Rule 10b–5’s private right of action does not 

include suits against aiders and abettors.” Ante, at 7. But 

Central Bank concerns a different matter. And it no more 

requires the majority’s rule than free air travel for small 

children requires free air travel for adults. 

Central Bank is a case about secondary liability, liability 

attaching, not to an individual making a false statement,

but to an individual helping someone else do so. Central 

Bank involved a bond issuer accused of having made 

materially false statements, which overstated the values

of property that backed the bonds. Central Bank also 

involved a defendant that was a bank, serving as indenture trustee, which was supposed to check the bond issuer’s valuations. The plaintiffs claimed that the bank 

delayed its valuation checks and thereby helped the issuer 

make its false statements credible. The question before 
Cite as: 564 U. S. ____ (2011) 5 

BREYER, J., dissenting 

the Court concerned the bank’s liability—a secondary

liability for “aiding and abetting” the bond issuer, who (on 

the theory set forth) was primarily liable. 

The Court made this clear. The question presented was

“whether private civil liability under §10(b) extends . . . to 

those who do not engage in the manipulative or deceptive 

practice, but who aid and abet the violation.” 511 U. S., at 

167 (emphasis added). The Court wrote that “aiding and

abetting liability reaches persons who do not engage in the 

proscribed activities at all, but who give a degree of aid to 

those who do.” Id., at 176 (emphasis added). The Court 

described civil law “aiding and abetting” as “‘know[ing]

that the other’s conduct constitutes a breach of duty and 

giv[ing] substantial assistance or encouragement to the 

other . . . .’” Id., at 181 (quoting Restatement (Second) of 

Torts §876(b) (1977); emphasis added). And it reviewed a 

Court of Appeals decision that had defined the elements of

aiding and abetting as “(1) a primary violation of §10(b); 

(2) recklessness by the aider and abettor as to the existence of the primary violation; and (3) substantial assistance given to the primary violator by the aider and abettor.” 511 U. S., at 168 (emphasis added). Faced with this 

question, the Court answered that §10(b) and Rule 10b–5 

do not provide for this kind of “aiding and abetting” liability in private suits.

By way of contrast, the present case is about primary 

liability—about individuals who allegedly themselves 

“make” materially false statements, not about those who

help others to do so. The question is whether Janus Management is primarily liable for violating the Act, not 

whether it simply helped others violate the Act. The 

Central Bank defendant concededly did not make the false 

statements in question (others did), while here the defendants allegedly did make those statements. And a rule 

(the majority’s rule) absolving those who allegedly did 

make false statements does not “follow from” a rule (Cen-
6 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

BREYER, J., dissenting 

tral Bank’s rule) absolving those who concededly did not 

do so. 

The majority adds that to interpret the word “make” as

including those “without ultimate control over the content

of a statement” would “substantially undermine” Central 

Bank’s holding. Ante, at 7. Would it? The Court in Central Bank specifically wrote that its holding did 

“not mean that secondary actors in the securities 

markets are always free from liability under the securities Acts. Any person or entity, including a lawyer, 

accountant, or bank, who employs a manipulative device or makes a material misstatement (or omission)

on which a purchaser or seller of securities relies may 

be liable as a primary violator under 10b–5, assuming 

all of the requirements for primary liability under 

Rule 10b–5 are met.” 511 U. S., at 191 (some emphasis added). 

Thus, as far as Central Bank is concerned, depending upon

the circumstances, board members, senior firm officials, 

officials tasked to develop a marketing document, large 

investors, or others (taken together or separately) all

might “make” materially false statements subjecting

themselves to primary liability. The majority’s rule does

not protect, it extends, Central Bank’s holding of noliability into new territory that Central Bank explicitly 

placed outside that holding. And by ignoring the language

in which Central Bank did so, the majority’s rule itself

undermines Central Bank. Where is the legal support for 

the majority’s “draw[ing] a clean line,” ante, at 7, n. 6, that 

so seriously conflicts with Central Bank? Indeed, where is 

the legal support for the majority’s suggestion that plaintiffs must show some kind of “attribution” of a statement 

to a defendant, ante, at 11, n. 11—if it means plaintiffs

must show, not only that the defendant “ma[d]e” the 

statement, but something more? 
Cite as: 564 U. S. ____ (2011) 7 

BREYER, J., dissenting 

The majority also refers to Stoneridge, but that case 

offers it no help. In Stoneridge, firms that supplied 

electronic equipment to a cable television company agreed

with the cable television company to enter into a series of

fraudulent sales and purchases, for example, a sale at an

unusually high price, thereby providing funds which the 

suppliers would use to buy advertising from the cable

television company. These arrangements enabled the 

cable television company to fool its accountants (and 

ultimately the public) into believing that it had more

revenue (for example, advertising revenue) than it really 

had. As part of the agreement, the companies exchanged

letters and backdated contracts to conceal the fraud. 

Investors subsequently sued the cable television company, 

some of its officers, its auditors, and the equipment 

suppliers, as well, claiming that all of them had engaged 

in a scheme to defraud securities purchasers. In respect to

most of the defendants, investors identified allegedly

materially false statements contained in the cable 

television company’s financial statements or similar documents. But in respect to the equipment suppliers, investors claimed that the relevant deceptive conduct was

in the letters, backdated contracts, and related oral 

conversations about the scheme. The investors argued

that the equipment suppliers, “by participating in the 

transactions,” violated §10(b) and Rule 10b–5. Stoneridge, 

552 U. S., at 155. 

The Court held that the equipment suppliers could not 

be found liable for securities fraud in a private suit under 

§10(b). But in doing so, it did not deny that the equipment 

suppliers had made the false statements contained in the 

letters, contracts, and conversations. See id., at 158–159. 

Rather, the Court said the issue in the case was whether 

“any deceptive statement or act respondents made was not

actionable because it did not have the requisite proximate 

relation to the investors’ harm.” Ibid. (emphasis added). 
8 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

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BREYER, J., dissenting 

And it held that these deceptive statements or actions 

could not provide a basis for liability because the investors

could not prove sufficient reliance upon the particular 

false statements that the equipment suppliers had made.

The Court pointed out that the equipment suppliers

“had no duty to disclose; and their deceptive acts were not

communicated to the public.” Id., at 159. And the Court 

went on to say that “as a result,” the investors “cannot 

show reliance upon any” of the equipment suppliers’ 

actions, “except in an indirect chain that we find too 

remote for liability.” Ibid. The Court concluded, 

“[the equipment suppliers’] deceptive acts, which were

not disclosed to the investing public, are too remote to 

satisfy the requirement of reliance. It was [the cable

company], not [the equipment suppliers], that misled

its auditor and filed fraudulent financial statements; 

nothing [the equipment suppliers] did made it 

necessary or inevitable for [the cable company] to

record the transactions as it did.” Id., at 161. 

Insofar as the equipment suppliers’ conduct was at issue, 

the fraudulent “arrangement . . . took place in the 

marketplace for goods and services, not in the investment

sphere.” Id., at 166. 

It is difficult for me to see how Stoneridge “support[s]” 

the majority’s rule. Ante, at 7. No one in Stoneridge 

disputed the making of the relevant statements, the 

fraudulent contracts and the like. And no one in 

Stoneridge contended that the equipment suppliers were, 

in fact, the makers of the cable company’s misstatements. 

Rather, Stoneridge was concerned with whether the 

equipment suppliers’ separate statements were sufficiently

disclosed in the securities marketplace so as to be the

basis for investor reliance. They were not. But this is a 

different inquiry than whether statements acknowledged

to have been disclosed in the securities marketplace and 
Cite as: 564 U. S. ____ (2011) 9 

BREYER, J., dissenting 

ripe for reliance can be said to have been “ma[d]e” by one 

or another actor. How then does Stoneridge support the 

majority’s new rule? 

The majority adds that its rule is necessary to avoid “a

theory of liability similar to—but broader in application

than”—§20(a)’s liability, for “‘[e]very person who, directly

or indirectly, controls any person liable’” for violations of 

the securities laws. Ante, at 10 (quoting 15 U. S. C. A. 

§78t(a) (Feb. 2011 Supp.)). But that is not so. This Court 

has explained that the possibility of an express remedy 

under the securities laws does not preclude a claim under 

§10(b). Herman & MacLean v. Huddleston, 459 U. S. 375, 

388 (1983).

More importantly, a person who is liable under §20(a) 

controls another “person” who is “liable” for a securities 

violation. Morrison v. National Australia Bank Ltd., 561 

U. S. ___, ___, n. 2 (2010) (slip op., at 3, n. 2) (“Liability 

under §20(a) is obviously derivative of liability under some 

other provision of the Exchange Act”). We here examine 

whether a person is primarily liable whether they do, or 

they do not, control another person who is liable. That is 

to say, here, the liability of some “other person” is not at

issue. 

And there is at least one significant category of cases 

that §10(b) may address that derivative forms of liability,

such as under §20(a), cannot, namely, cases in which one 

actor exploits another as an innocent intermediary for its 

misstatements. Here, it may well be that the Fund’s

board of trustees knew nothing about the falsity of the 

prospectuses. See, e.g., In re Lammert, Release No. 348, 

93 S. E. C. Docket 5676, 5700 (2008) (Janus Management

was aware of market timing in the Janus Fund no later 

than 2002, but “[t]his knowledge was never shared with

the Board”). And if so, §20(a) would not apply.

The possibility of guilty management and innocent 

board is the 13th stroke of the new rule’s clock. What is to 
10 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

TRADERS 

BREYER, J., dissenting 

happen when guilty management writes a prospectus (for

the board) containing materially false statements and

fools both board and public into believing they are true? 

Apparently under the majority’s rule, in such circumstances no one could be found to have “ma[d]e” a materially false statement—even though under the common

law the managers would likely have been guilty or liable 

(in analogous circumstances) for doing so as principals 

(and not as aiders and abettors). See, e.g., 2 W. LaFave, 

Substantive Criminal Law §13.1(a) (2d ed. 2003); 1 M. 

Hale, Pleas of the Crown 617 (1736); Perkins, Parties to

Crime, 89 U. Pa. L. Rev. 581, 583 (1941) (one is guilty as a

principal when one uses an innocent third party to commit 

a crime); Restatement (Second) of Torts §533 (1976). Cf. 

United States v. Giles, 300 U. S. 41, 48–49 (1937). 

Indeed, under the majority’s rule it seems unlikely that

the SEC itself in such circumstances could exercise the 

authority Congress has granted it to pursue primary 

violators who “make” false statements or the authority 

that Congress has specifically provided to prosecute aiders 

and abettors to securities violations. See §104, 109 Stat. 

757 (codified at 15 U. S. C. A. §78t(e) (Feb. 2011 Supp.))

(granting SEC authority to prosecute aiders and abettors).

That is because the managers, not having “ma[d]e” the 

statement, would not be liable as principals and there 

would be no other primary violator they might have 

tried to “aid” or “abet.” Ibid.; SEC v. DiBella, 587 F. 3d 

553, 566 (CA2 2009) (prosecution for aiding and abetting requires primary violation to which offender gave 

“substantial assistance” (internal quotation marks 

omitted)).

If the majority believes, as its footnote hints, that §20(b) 

could provide a basis for liability in this case, ante, at 10, 

n. 10, then it should remand the case for possible amendment of the complaint. “There is a dearth of authority

construing Section 20(b),” which has been thought largely 
Cite as: 564 U. S. ____ (2011) 11 

BREYER, J., dissenting 

“superfluous in 10b–5 cases.” 5B A. Jacobs, Disclosure 

and Remedies Under the Securities Law §11–8, p. 11–72

(2011). Hence respondent, who reasonably thought that it

referred to the proper securities law provision, is faultless

for failing to mention §20(b) as well.

In sum, I can find nothing in §10(b) or in Rule 10b–5, its

language, its history, or in precedent suggesting that 

Congress, in enacting the securities laws, intended a 

loophole of the kind that the majority’s rule may well 

create. 

II 

Rejecting the majority’s rule, of course, does not decide

the question before us. We must still determine whether, 

in light of the complaint’s allegations, Janus Management 

could have “ma[d]e” the false statements in the 

prospectuses at issue. In my view, the answer to this 

question is “Yes.” The specific relationships alleged

among Janus Management, the Janus Fund, and the 

prospectus statements warrant the conclusion that Janus 

Management did “make” those statements.

In part, my conclusion reflects the fact that this Court

and lower courts have made clear that at least sometimes 

corporate officials and others can be held liable under Rule

10b–5 for having “ma[d]e” a materially false statement 

even when that statement appears in a document (or is 

made by a third person) that the officials do not legally

control. In Herman & MacLean, for example, this Court 

pointed out that “certain individuals who play a part in

preparing the registration statement,” including corporate 

officers, lawyers, and accountants, may be primarily liable

even where “they are not named as having prepared or 

certified” the registration statement. 459 U. S., at 386, n. 

22. And as I have already pointed out, this Court wrote in 

Central Bank that a “lawyer, accountant, or bank, who . . . 

makes a material misstatement (or omission) on which a 
12 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

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BREYER, J., dissenting 

purchaser or seller of securities relies may be liable as a 

primary violator under 10b–5, assuming all of the requirements for primary liability under Rule 10b–5 are 

met.” 511 U. S., at 191 (some emphasis added). 

Given the statements in our opinions, it is not surprising that lower courts have found primary liability for 

actors without “ultimate authority” over issued statements. One court, for example, concluded that an accountant could be primarily liable for having “ma[d]e” 

false statements, where he issued fraudulent opinion and 

certification letters reproduced in prospectuses, annual

reports, and other corporate materials for which he was 

not ultimately responsible. Anixter v. Home-Stake 

Production Co., 77 F. 3d 1215, 1225–1227 (CA10 1996). In 

a later case postdating Stoneridge, that court reaffirmed 

that an outside consultant could be primarily liable for 

having “ma[d]e” false statements, where he drafted 

fraudulent quarterly and annual filing statements later 

reviewed and certified by the firm’s auditor, officers, and

counsel. SEC v. Wolfson, 539 F. 3d 1249, 1261 (CA10 

2008). And another court found that a corporation’s chief 

financial officer could be held primarily liable as having 

“ma[d]e” misstatements that appeared in a form 10–K 

that she prepared but did not sign or file. McConville v. 

SEC, 465 F. 3d 780, 787 (CA7 2006). 

One can also easily find lower court cases explaining 

that corporate officials may be liable for having “ma[d]e”

false statements where those officials use innocent 

persons as conduits through which the false statements

reach the public (without necessarily attributing the false

statements to the officials). See, e.g., In re Navarre Corp. 

Securities Litigation, 299 F. 3d 735, 743 (CA8 2002) (liability may be premised on use of analysts as a conduit to 

communicate false statements to market); In re Cabletron 

Systems, Inc., 311 F. 3d 11, 38 (CA1 2002) (rejecting a test 

requiring legal “control” over third parties making state­
Cite as: 564 U. S. ____ (2011) 13 

BREYER, J., dissenting 

ments as giving “company officials too much leeway to

commit fraud on the market by using analysts as their 

mouthpieces” (internal quotation marks omitted)); Novak 

v. Kasaks, 216 F. 3d 300, 314–315 (CA2 2000); Cooper v. 

Pickett, 137 F. 3d 616, 624 (CA9 1997); Freeland v. Iridium World Communications, Ltd., 545 F. Supp. 2d 59, 75– 

76 (DC 2008). 

My conclusion also reflects the particular circumstances

that the complaint alleges. The complaint states that

“Janus Management, as investment advisor to the funds,

is responsible for the day-to-day management of its 

investment portfolio and other business affairs of the 

funds. Janus Management furnishes advice and recommendations concerning the funds’ investments, as well as

administrative, compliance and accounting services for the 

funds.” Complaint ¶18, App. to Pet. for Cert. 65a. Each of 

the Fund’s 17 officers was a vice president of Janus 

Management. App. 250a–258a. The Fund has “no assets 

separate and apart from those they hold for shareholders.” 

In re Mutual Funds Inv. Litigation, 384 F. Supp. 2d 845, 

853, n. 3 (Md. 2005). Janus Management disseminated 

the fund prospectuses through its parent company’s Web 

site. Complaint ¶38, App. to Pet. for Cert. 72a. Janus 

Management employees drafted and reviewed the Fund

prospectuses, including language about “market timing.”

Complaint ¶31, id., at 69a; In re Mutual Funds Inv. 

Litigation, 590 F. Supp. 2d 741, 747 (Md. 2008). And 

Janus Management may well have kept the trustees in the

dark about the true “market timing” facts. Complaint

¶51, App. to Pet. for Cert. 80a; In re Lammert, 93 S. E. C. 

Docket, at 5700. 

Given these circumstances, as long as some managers,

sometimes, can be held to have “ma[d]e” a materially false

statement, Janus Management can be held to have done

so on the facts alleged here. The relationship between

Janus Management and the Fund could hardly have been 
14 JANUS CAPITAL GROUP, INC. v. FIRST DERIVATIVE 

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BREYER, J., dissenting 

closer. Janus Management’s involvement in preparing 

and writing the relevant statements could hardly have 

been greater. And there is a serious suggestion that the 

board itself knew little or nothing about the falsity of what 

was said. See supra, at 9, 13. Unless we adopt a formal

rule (as the majority here has done) that would arbitrarily 

exclude from the scope of the word “make” those who

manage a firm—even when those managers perpetrate a

fraud through an unknowing intermediary—the management company at issue here falls within that scope. 

We should hold the allegations in the complaint in this

respect legally sufficient.

With respect, I dissent.