S&C Secures for Goldman Sachs a Rare Third Appellate Review of Class Certification in Major Securities Case

March 16, 2022

In a securities case remanded from the U.S. Supreme Court, Goldman Sachs obtained a third discretionary Rule 23(f) appeal of a grant of class certification. Since Rule 23(f) was adopted in 1998, this is only the second case in which a federal appeals court has granted interlocutory review of class certification three times. The U.S. Court of Appeals for the Second Circuit granted review in Goldman Sachs Group v. Arkansas Teacher Retirement System on March 9.
Last June, the Supreme Court ruled 8-1 in favor of Goldman Sachs, clarifying the standards for rebutting the “fraud-on-the-market” presumption of class-wide reliance. The Court agreed with Goldman Sachs that the generic nature of its challenged statements is important evidence in determining whether those statements impacted the price of Goldman Sachs' stock, which is a requirement for certifying a shareholder class. On remand, the district court re-certified a class.
The petition for review was supported by multiple amici, including the U.S. Chamber of Commerce, the Bank Policy Institute, the Securities Industry and Financial Markets Association, the Washington Legal Foundation, and a group of former SEC officials and law professors.
The S&C team representing Goldman Sachs and its former senior executives includes Bob Giuffra, Rich Klapper, David Rein, Ben Walker, Julia Malkina, Jacob Cohen and Morgan Ratner.