Comments and Recommendations on the Adoption of Market-Based Causation in Australian Securities Fraud Class Actions
DOI:
https://doi.org/10.62051/k9424528Keywords:
causation; securities fraud class actions; market-based causation.Abstract
In Australia, the test for proving causation in securities fraud class actions is controversial. The Australian courts have partially accepted market-based causation. This essay argues that this mechanism is not applicable to the current Australian legal framework. Accordingly, Australian legal system should be adapted to accommodate this mechanism, and until then, direct reliance should be the primary option.
Downloads
References
[1] Campbell v Backoffice Investments Pty Ltd [2009] HCA 25
[2] Australian Securities & Investments Commission v Adler [2002] NSWSC 171
[3] Caason Investments Pty Ltd v Cao [2015] FCAFC 94
[4] Caason Investments Pty Ltd v Cao (2014) 104 ACSR 67
[5] TPT Patrol Pty Ltd v Myer Holdings Ltd [2019] FCA 1747
[6] Legg, Michael, ‘Judicial recognition of indirect causation and shareholder class actions’ (2016) 44(6) Australian Business Law Review 429
[7] Phi, Ben and Tim Finney, ‘Establishing Causation in Australian Shareholder Class Actions’ [2020] (129) Precedent (Sydney, N.S.W.) 28
[8] Watson, A and J Varghese, ‘The Case for Market-Based Causation’ (2009) 32 University of New South Wales Law Journal 948
[9] Coffee, JC and HA Sale, Securities Regulation: Cases and Materials (Foundation Press, 12th ed, 2012)
[10] Spender, P, ‘Securities Class Actions: A View from the Land of the Great White Shareholder’ (2002) 31 Common Law World Review 123
[11] Bratton, WW and ML Wachter, ‘The Political Economy of Fraud on the Market’ (2011) 160 University of Pennsylvania Law Review 69
[12] Ingot Capital Investments Pty Ltd v Macquarie Equity Capital Markets Ltd [2008] NSWCA 206
[13] Argent, James, ‘Requiring proof of individual reliance to establish causation in disclosure-based shareholder class actions: The role of principle and policy’ (2016) 34 Company and Securities Law Journal 87
[14] Grave, D, L Watterson and H Mould, ‘Causation, Loss and Damage: Challenges for the New Shareholder Class Action’ (2007) 27 Company and Securities Law Journal 483
[15] Barber, BM and T Odean, ‘All That Glitters: The Effect of Attention and News on the Buying Behaviour of Individual and Institutional Investors’ (2008) 21 Review of Financial Studies 785
[16] Ingot Capital Investments Pty Ltd v Macquarie Equity Capital Markets Ltd [2008] NSWCA 206
[17] Pollet, JM and M Wilson, ‘Average Correlation and Stock Market Returns’ (2010) 96 Journal of Financial Economics 364
[18] Brealey, RA, SC Myers and F Allen, Principles of Corporate Finance (McGraw-Hill Irwin, 11th ed, 2014)
[19] MacKinlay, ‘Event Studies in Economics and Finance’ (1997) 35 Journal of Economic Literature 13
[20] Beach, J, ‘Class Actions: Some Causation Questions’ (2011) 85 Australian Law Journal 587
Downloads
Published
Conference Proceedings Volume
Section
License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
How to Cite
