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On December 7, 2010, the Supreme Court heard oral argument in Janus Capital Group, Inc. v. First Derivative Traders. The question at issue was whether an investment advisor could be subjected to primary liability in a federal securities lawsuit brought by private parties, on the grounds that the investment advisor "helped" a mutual fund draft and disseminate a prospectus containing misleading statements. Although it was the mutual fund--and not the investment advisor--that issued the misleading prospectus, the plaintiffs contended that the investment advisor’s participation in the creation and dissemination of the prospectus was sufficient to subject the investment advisor to primary liability in a private action for federal securities violations.

To discuss the case, we have Jonathan Cohn, who is a partner at Sidley Austin LLP.

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