Today, the U.S. Supreme Court ruled that state courts can continue to hear certain securities class actions brought under federal law. In Cyan, Inc. et al. v. Beaver County Employees Retirement Fund, the Supreme Court held that the Securities Litigation Uniform Standards Act of 1998 (SLUSA) did nothing to strip state courts of their longstanding jurisdiction to adjudicate class actions brought under the 1933 Act. The central question was whether § 77p of the SLUSA limits state-court jurisdiction over class actions brought under the 1933 Act. The Court held that it does not. Section 77p bars certain securities class actions based on state law but it says nothing, and so does nothing, to deprive state courts of jurisdiction over class actions based on federal law. That means §77v(a)’s background rule—under which a state court may hear the Investors’ 1933 Act suit—continues to govern.
15-1439 Cyan, Inc. v. Beaver County Employees Retirement Fund (03/20/2018)