As every securities lawyer knows, U.S. Securities and Exchange Commission Rule 10b-5 makes it unlawful to, among other things, “make” a materially false statement in connection with a securities transaction. Next week, the U.S. Supreme Court will hear argument in Lorenzo v. SEC, a case that presents the question of whether a person who knowingly disseminates to investors a false statement “made” by someone else can still be found primarily liable under Rule 10b-5. Lorenzo thus addresses an issue left open in Janus Capital Group Inc. v. First Derivative Traders, where the court, in a 5-4 decision, narrowly defined the “maker” of a statement for purposes of Rule 10b-5(b) as “the person or entity with ultimate authority over the statement, including its content and whether and how to communicate it.” Janus held that a fund adviser that allegedly drafted materially misleading statements in a prospectus issued by the fund could not be held primarily liable under 10b-5(b) because the fund, not the adviser, was the maker of the statements.

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