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Rule 10b-5 and reasonable reliance: Why courts should abandon focus on non-reliance clauses

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Version 2 2024-06-03, 23:46
Version 1 2019-07-15, 13:56
journal contribution
posted on 2024-06-03, 23:46 authored by Jonathan P Altman
In a typical privately negotiated merger or acquisition, the parties involved will be engaged in months of negotiations prior to the closing of their deal. Over the course of such, many projections, agreements, documents, oral representations and warranties (hereinafter “information”) will undoubtedly be exchanged by both sides. In the final purchase agreement, a seller typically lists detailed representations and warranties about its business, and includes a proviso that the buyer is not relying on any other information. Inclusion of this “non-reliance clause” (hereinafter “NRC”) is intended to restrict a buyer’s ability to bring a fraud claim under Rule 10b-5.

History

Journal

University of Pittsburgh Law Review

Volume

68

Pagination

747-761

Location

Pittsburgh, Pa.

Open access

  • Yes

ISSN

0041-9915

eISSN

1942-8405

Language

eng

Publication classification

CN.1 Other journal article

Issue

3

Publisher

University of Pittsburgh * University Library System

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