The U.S. Supreme Court today declined to abandon the efficient-market theory, with its rebuttable presumption of reliance that enables securities class actions to proceed without proof of actual reliance on alleged misrepresentations or omissions. However, the Court’s ruling in Halliburton Co. v. Erica P. John Fund, Inc. allows defendants to try to show at the class-certification stage that the alleged misrepresentations did not in fact affect the price of the securities at issue.

The Halliburton decision is likely to increase the complexity, importance, and expense of class-certification proceedings and could influence both sides’ settlement strategies in securities class actions.