This presentation will focus on concepts of fiduciary duty, particularly with respect to corporate directors and officers, under the federal securities laws. Although the U.S. securities laws are premised principally on disclosure rather than substantive fairness, fiduciary duty concepts exist in several settings. On numerous occasions, the U.S. Supreme Court has recognized that company directors and officers are fiduciaries. For instance, under Supreme Court precedent, the law of insider trading under the primary antifraud provision, Section 10(b) of the Securities Exchange Act, is premised on fiduciary duty analysis. Moreover, fiduciary-like standards apply in the Securities Act registration statement context by means of the availability of the director and officer due diligence defense. However, even though deemed fiduciaries, lax liability standards prevail. The laxity is shown, for example, by the scienter requirement mandated in Section 10(b) actions as well as the permissive approach to forward-looking statements, statements of belief, and puffery whereby liability is levied, if at all, only if a director or officer acts with intentional misconduct. The propriety of these liability standards has been embraced by both the U.S. courts and Congress. The consequence is that a wide gap exists between rhetoric and standards of liability under the U.S. securities laws.

Speaker biography: Professor Marc I. Steinberg is the Rupert and Lillian Radford Chair in Law and Professor of Law at the Southern Methodist University (SMU) Dedman School of Law. He has served as a Professor, Fellow, or has lectured at several other prominent universities, including the University of Cambridge, University of London, Heidelberg University, Stockholm University, University of Tel Aviv, Moscow State University, University of Sydney, Auckland University, University of Hong Kong, University of Tokyo, UCLA, and University of Pennsylvania. Professor Steinberg was an attorney for the U.S. Securities and Exchange Commission (SEC) in the SEC’s Division of Enforcement and its Office of General Counsel. He also has been retained as an expert witness in several high-profile cases. Professor Steinberg is the most prolific author of securities law scholarship in the United States, having authored more than 150 law review articles as well as approximately 45 books. One of his recent books, Rethinking Securities Law (Oxford University Press 2021), was awarded Winner best law book in the United States for 2021 by American Book Fest. He is editor-in-chief of The International Lawyer and The Securities Regulation Law Journal. Professor Steinberg is a member of The American Law Institute.

The event is hosted by Dr Lerong Lu (Senior Lecturer in Law, King’s College London)