On February 21, 2023, the United States Supreme Court formally dismissed the appeal of a case in which a settlement had been announced after certiorari was granted to review a decision by a California state court allowing plaintiffs to take discovery in an action under the Securities Act of 1933 (the “Securities Act”). Pivotal Software, Inc. v. Tran, No. 20-1541. As noted in our prior post, the issue presented by the petition was whether the discovery-stay provision of the Private Securities Litigation Reform Act ( “PSLRA”)—which provides that “in any private action arising under” the Securities Act, “all discovery and other proceedings shall be stayed during the pendency of any motion to dismiss”—applies in Securities Act cases filed in state court.
Shortly after the Supreme Court agreed to hear the case, however, the parties informed the Court that they were nearing a settlement, and the Court, therefore, removed the case from its argument calendar. As anticipated, the appeal has now been formally dismissed following completion of the settlement. The Supreme Court will presumably remain receptive to addressing this issue in the future, particularly given that state courts have been split on whether the PSLRA’s automatic stay of discovery applies to state court proceedings.
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