The full report discussed in this release is available here: http://bit.ly/1jOYWbE

 WASHINGTON, D.C.,  March 4, 2014 – A challenge to the Halliburton corporation by one of its own shareholders – an investment fund that helps the charitable work of a Catholic archdiocese – could have enormous implications for shareholders’ rights, and for all Americans seeking to stand up for their rights in court, according to a report released today by Alliance for Justice.

The case, Halliburton Co. v. Erica P. John Fund, is scheduled for oral argument before the Supreme Court tomorrow.  It pits the corporate giant against its own investors, led by a fund that helps the Archdiocese of Milwaukee support its programs for inner city youth and the mentally ill.  The fund alleges that Halliburton misled investors by, among other things, understating its liability for claims from asbestos victims.

“The legal issues extend far beyond this single case,” said AFJ president Nan Aron.   “Halliburton is asking the Supreme Court to overturn settled law, abandon a 26-year-old precedent, and add still another barrier to the ability of Americans to join together as a class to fight for their rights.”

At issue is the standard required to prove that investors relied on false information from a company when deciding to invest in that company.  Recognizing that it is virtually impossible for investors to prove one-at-a-time that they relied on misinformation, the Court ruled in 1988 that there is a rebuttable presumption that the price of a stock reflects all publicly available information – including false information.  Halliburton wants the Supreme Court to reverse or severely limit this precedent.

According to the report, if that happens

 it would be reaching back more than 25 years to pull the rug out from under investors everywhere who have been defrauded by executives with a fiduciary duty to act in shareholders’ interests.  In many instances, it would essentially be giving businesses like Halliburton a “get out of jail free” card to defraud their own shareholders without consequence.  And more broadly, it would be another instance of the Supreme Court’s making it increasingly difficult for individuals and organizations harmed by corporate wrongdoers—including the very stockholders on whose investments the corporations rely—to access justice in America.

“Unfortunately, the Roberts Court majority has a long history of limiting access to the courts for everyday Americans,” Aron said.  “We will be watching to see if the Court finally is ready to make an exception.”

Alliance for Justice is a national association of over 100 organizations, representing a broad array of groups committed to progressive values and the creation of an equitable, just, and free society. Through our justice programs, we lead the progressive community in the fight for a fair judiciary, and through our advocacy programs, we help nonprofits and foundations to realize their advocacy potential.  Learn more about Alliance for Justice at afj.org.