If you stay abreast of the most recent Supreme Court news, you’d think that securities-fraud class actions were in grave danger. Every so often, authorities posit that the Court’s next decision will bring a new way of life to securities class actions, potentially throwing the practice area into a tailspin. While the Court’s decisions could heavily impact litigation, let’s unpack why those who are waiting for a disastrous end to securities cases are wasting their time waiting for Godot.

In its last several terms, the U.S. Supreme Court has taken unprecedented interest in cases related to securities laws and, more specifically, securities-fraud class actions. Each time the Supreme Court agrees to hear another securities-fraud class-action case, practitioners on both sides of the case begin to wring their hands over whether the Court’s decision will dramatically alter or eliminate the field.

In recent terms, the Court heard two such cases: Amgen and Halliburton I – both of which were feared to end investors’ securities class actions, and both of which instead reaffirmed the validity and importance of such cases.

The Court will likely issue its Halliburton II decision expounding upon the continued use of the fraud on the market theory in June 2014. Looking forward, the Court has also agreed to hear two new cases, Omnicare and Indymac, which again have the potential to alter the litigation protections for investors.

In Omnicare, Inc. v. Laborers District Council Construction Industry Pension Fund, the Court will grapple with the pleading requirements for stating a claim under Section 11 of the Securities Act of 1933. The issue the Court will address is whether a plaintiff must allege that a defendant’s statement of opinion is “untrue” because the statement is objectively wrong, or if the plaintiff must also allege that the statement is subjectively false – requiring allegations that the defendant’s actual opinion is different from the one expressed – in order to state a Section 11 violation.

In other words, can you sue someone for saying something that was false when stated or must the speaker also know the words are false when the words are spoken?

The Second, Third and Ninth Circuit Courts of appeal all follow the subjective falsity standard, but in Omnicare, the Sixth Circuit followed the objective falsity standard. Interestingly, that decision appears to contradict even the Sixth Circuit’s prior holding in Mayer v. Mylod where the Sixth Circuit expressly followed the subjective falsity standard. For investors, the potential that the Supreme Court may inject some level of intent into the pleading standards for Section 11 cases could limit the scope of cases available for those who purchase shares based on statements contained in a Registration Statement that turn out to be false.

IndyMac has even greater potential to close the avenues for relief available to harmed investors. This case will tackle how long investors have to file their claim. For 40 years, investors have relied on the holding of American Pipe, where the Court allowed tolling of the statute of limitations to protect the interests of investors with securities fraud claims. American Pipe allowed investors to take a wait-and-see approach when deciding when and whether to participate in a securities class-action settlement or to opt out and pursue an individual case.

Well, the Second Circuit eliminated that possibility in IndyMac. The Second Circuit held that although American Pipe calls for tolling of the statute of limitation, it does not toll the statute of repose. The circuit court reasoned that the statute of repose is an absolute bar that cannot be tolled and will continue to run until an investor asserts their own individual claim. Because filing of a class action no longer tolls the statue of repose, now in the Second Circuit, investors must decide at the front of a case whether to intervene in a class action by filing their own protective lawsuits to preserve their claims and ability to seek recovery.

Historically, when a securities class action was filed, investors could choose to act as a lead plaintiff or not. If they did not, another investor would prosecute the case and if the case was successful all investors would get to claim their portion of the recovery or opt-out and seek their own remedy at a later date. Now, every time a securities class action is filed, investors will need to assess very early whether to intervene or file their own case to avoid the potential that the three-year statue of repose will run, thereby foreclosing any action. The potential that large numbers of place-holding lawsuits will flood the courts is a very real possibility within the Second Circuit.

Although these cases seem dire for investors, recent Supreme Court decisions have not resulted in a dramatically altered landscape. The Court has instead reaffirmed and validated those investor protections that have been in place for 80 years.

The impending Halliburton II decision this term and Omnicare and IndyMac in the next Supreme Court term will arrive, and we remain hopeful that investors will continue to be afforded the protections needed to ensure a fair, reliable and transparent market.