Brief Fact Summary. Ivax Corp. (Defendant) issued multiple press releases including forward-looking statements.
Synopsis of Rule of Law. When the elements underlying a prediction or economic estimate include both suppositions and declarations of known fact, the complete list is regarded as a forward-looking statement.
When an investor has been warned of risks of a significance similar to that actually realized, she is sufficiently on notice of the danger of the investment to make an intelligent decision about it according to her own preferences for risk and reward.View Full Point of Law
Issue. Are mixed statements protected under the safe harbor provision for forward-looking statements?
Held. (Cox, J.) Yes. Forward-looking statements are usually comprised of historical observation and assumptions regarding the future. Therefore, treating the mixed statement in the September 30 press release as a forward-statement is consistent with congressional objective to relax the â€œmuzzling effectâ€ of possible liability for forward-looking statements. This objective is at the core of the safe harbor stipulation. Affirmed.
Discussion. The Private Securities Litigation Reform Act of 1995(PSLRA) attached the safe harbor stipulation for forward-looking statements to the Securities Exchange Act of 1934. The year after the PSLRA’s creation, there was a noticeable upsurge in the quantity of firms proffering financial predictions, with the largest increase among the chancier firms.