Court Opinion

ID: 9459757
Source: CourtListenerOpinion
Date Created: 2023-08-04 21:31:14.137932+00
Date Added: 2024-06-11T17:36:19.682035
License: Public Domain

MULLIGAN, Circuit Judge
(concurring) :
While I concur in the reversal and remand here, I am not satisfied that the test of culpability under Rule 10b-5 has been articulated adequately in the majority opinion. Judge Oakes adopts the standard explicated in Chris-Craft Industries, Inc. v. Piper Aircraft Corp., 480 F.2d 341 (2d Cir., 1973), in the opinions of Judges Timbers and Mansfield, and characterizes it as something short of specific intent and something more than mere negligence. In fact^ the latest statement of the rule is in’ the en banc opinion of Judge Moore) for this court in Lanza v. Drexel & Co., 479 F.2d 1277 (2d Cir., 1973), where we said: “In sum, we believe that j)roof of a willful or reckless disregard for the truth is necessary to establish liability under Rule 10b-5.” (id. at 1306). Footnote 98 indicates the obvious- — that in detemining the liability of a defendant, his corporate responsibilities must be taken into consideration.
Since this is the latest statement of the rule of this circuit and the en banc was granted primarily to clarify the rule, I see no reason at all for relegating it here to a list of some seven prior cases which we advise the court below to consider. I would now abide by the rule we so recently adopted.