Law360: Arbitration Clauses Won’t Protect IPOs From Investor Suits

With the US Securities and Exchange Commission greenlighting the use of mandatory arbitration clauses for newly public companies, securities litigation experts are waiting to see whether any company is willing to risk the almost inevitable legal blowback that will come with taking advantage of the shift in policy. O’Melveny vice chair and Securities Litigation and Financial Services Practice co-chair Matthew Close told Law360 that the SEC did “a decent job of documenting a series of cases that would seem to indicate that this would be permissible under federal law. But I certainly expect there to be challenges and that issue to be tested.”

Read the full article here.