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Email On May 10, 2021, in SEC v. Morrone, a panel of the U.S. Court of Appeals for the First Circuit held that the federal securities laws apply to securities transactions as long as “irrevocable liability”—the point at which parties become legally bound to carry out the transaction—occurs in the United States. The Court thus joined the Ninth Circuit in rejecting the Second Circuit’s more defendant-friendly approach to extraterritoriality, under which a defendant may avoid liability by showing that the claims “are so predominantly foreign as to be impermissibly extraterritorial.” Until the Supreme Court resolves this circuit split, plaintiffs asserting securities claims involving foreign transactions likely will steer clear of the Second Circuit, opting for circuits that have rejected such fact-intensive defenses. https://www.cadwalader.com/resources/clients-friends-memos/securities-litigation-update-first-circuit-endorses-broad-view-of-extraterritorial-reach-of-the-federal-securities-laws-cementing-split-with-the-second-circuit-on-the-meaning-of-a-domestic-transaction