Omnicare, Inc. v. Laborers Dist. Council Constr. Industry Pension Fund

**Question presented** Do the “false‑statement” and “omission” provisions of Section 11 of the 1933 Securities Act apply to statements of opinion that a company includes in its registration statement, and if so, how? **Holding** The Supreme Court held that: 1. A statement of opinion is **not** an “untrue statement of a material fact” simply because the opinion later turns out to be wrong. It only becomes an “untrue statement of fact” if the company did **not** honestly hold that belief. 2. Even though an opinion itself is protected, the company can still be liable under the “omission” part of Section 11 if it leaves out material facts that a reasonable investor would need to understand the basis of that opinion. Because the lower courts did not apply the correct “reasonable‑investor” standard to the omission claim, the case was sent back for further review. **Core reasoning (in plain English)** *Majority*: - The Court first explained the difference between a **fact** (a claim of certainty about something) and an **opinion** (a claim about what the speaker thinks). Since an opinion admits that it might be wrong, the fact‑based false‑statement rule does not automatically catch a mistaken opinion. The only way an opinion can be a false statement of fact is if the company *didn’t actually believe* what it said. In this case, the investors did not allege that Omnicare’s belief was insincere, so the false‑statement claim fails. - However, the Court said that an opinion can still mislead if the company leaves out important information about **how** it formed that opinion—such as what investigations it did or what facts it knew. Whether the omission is material is judged from the viewpoint of a **reasonable investor** reading the whole registration statement. If a reasonable investor would think the opinion implies certain facts that are missing, the omission provision can create liability. Because the lower courts did not test the omission claim using this “reasonable‑investor” lens, the case was remanded for that analysis. *Concurring opinions*: - Justice Scalia agreed with the majority on the opinion‑statement rule but wrote separately to stress his own views. - Justice Thomas agreed with the majority’s result but also wrote a separate concurrence. **Vote** The opinion was joined by Chief Justice Roberts and Justices Kennedy, Ginsburg, Breyer, Alito, and Sotomayor (7 justices). Justices Scalia and Thomas filed separate concurring opinions; there was no dissent.