The U.S. District Court for the Northern District of California held on January 4, 2017 that the federal securities laws apply to U.S. transactions in sponsored, but unlisted, American Depositary Receipts (“ADRs”) for a foreign issuer’s shares. The decision in In re Volkswagen “Clean Diesel” Marketing, Sales Practices, and Products Liability Litigation adds to the handful of decisions addressing whether U.S. transactions in sponsored, but unlisted, ADRs are covered by the federal securities laws. Most of those decisions have held that U.S. law applies to those transactions. The Volkswagen ruling also joins the majority of decisions in holding that the over-the-counter (“OTC”) markets are not considered to be “exchanges” for purposes of determining the scope of the federal securities laws.