Today the U.S. Supreme Court decided Stoneridge Investment Partners v. Scientific-Atlanta. By a vote of 5-3, the Court rejected "scheme liability" and held that private rights of action under Section 10(b) of the Securities Act do not reach third-party actions where shareholders did not rely upon the third party's actions or statements. Justice Kennedy wrote the opinion for the Court. Justice Stevens dissented, joined by Justices Ginsburg and Souter. Justice Breyer did not take part in the decision.

For more on the decision see Lyle Denniston on SCOTUSBlog, this Washington Post report, or this LA Times story. Jay Brown also has some thoughts on the Race to the Bottom blog. For more background, see this string of posts, or the Stoneridge resources page at CWRU's Center for Business Law & Regulation.

UPDATE: More from Professor Bainbridge, Ted Frank, and Elizabeth Nowicki.