July 2, 2025
The U.S. Supreme Court has agreed to take up at least one shareholder’s lawsuit when it reopens its doors in October, and securities attorneys from both the plaintiff and defense bars will be watching that appeal and several others as the year moves forward.
Securities practitioners told Law360 they are also following appeals that could further define the limits of past Supreme Court decisions on class certification, as well as a petition for the high court to hear a dispute over securities fraud suits against public company auditors.
Here’s a look at the cases and issues attorneys are monitoring:
Supreme Court’s next term
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Another securities case that the justices are being asked to hear could determine the future of lawsuits against public company auditors that allegedly commit securities fraud.
BDO USA LLP has petitioned the Supreme Court to overturn a Second Circuit ruling in investors’ favor, one that the auditor says created a “dangerous precedent” that “would be devastating to the public markets and the accounting profession.”
Suing investors had initially waived their right to respond to the petition before the justices asked them to reconsider in June. They have now been given until Aug. 13 to respond.
Laura Posner, a partner in investor-side firm Cohen Milstein Sellers & Toll PLLC, said BDO could be a “really critical case,” especially if the Republican-led Congress follows through on a promise to get rid of the Public Company Accounting Oversight Board as a stand-alone regulator.
“It is already an extremely high burden to bring accounting fraud cases against auditors,” Posner said. “If the Supreme Court were to reverse the Second Circuit, I think that would have devastating implications for investors.”
The cases are FS Credit Opportunities Corp. et al. v. Saba Capital Master Fund Ltd. et al., case number 24-345, and BDO USA LLP v. New England Carpenters Guaranteed Annuity and Pension Funds et al., case number 24-1151, both before the U.S. Supreme Court.
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A second shot at Slack?
Slack Technologies Inc. investors are preparing to bring their case before the Supreme Court for the second time in as many years, after the justices in 2023 issued a ruling that only partially resolved their case against the chat platform.
Investors argued that the company failed to warn shareholders that network outages brought on by increased demand would force it to pay out $8.2 million in customer credits.
But because Slack went public via a little-used method known as a direct listing, the Supreme Court said that claims asserted against the company under Section 11 of the Securities Act of 1933 must be thrown out because shareholders couldn’t prove the shares they purchased were issued by the company for the purpose of going public.
The court, however, declined to weigh in under a separate provision of the securities laws known as Section 12 and sent the case back to the Ninth Circuit for further review. The Ninth Circuit in February said the Section 12 claims couldn’t stand either, ruling that those allegations fail for the same reasons the Section 11 ones did.
The lead investor indicated in April that he might appeal that ruling to the Supreme Court, which has given him until July 10 to file a petition.
Palantir Technologies Inc. investors are likewise asking an appeal court to reconsider a post-Slack ruling, filing for Tenth Circuit review after a lower court ruled that the high court’s decision “forecloses” their case against the directly-listed company.
Posner of Cohen Milstein said that she didn’t think the Slack case or the Palantir case made a great vehicle for the Supreme Court to reassess its stance on post-IPO lawsuits, as many lower courts have not yet gotten a chance to weigh in on the impact of the 2023 ruling.
“I think it’s just premature at this point to know whether there is disagreement among courts or circuits, to know what standards courts are using at either the pleading stage or at the class certification stage or at the merit stage,” she said. “I personally don’t think it’s a ripe issue yet.”
The cases are Pirani v. Slack Technologies Inc., application number 24A1062, before the U.S. Supreme Court, and California Public Employees et al. v. Palantir Technologies Inc. et al., case number 25-1178, before the U.S. Court of Appeals for the Tenth Circuit.
Read High Court Case Tops List of Securities Appeals to Watch.