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Courts

Supreme Court puts off IPO disclosure case

The Supreme Court put on hold Tuesday a case challenging whether an issuer's duty to disclose certain information allows for class-action lawsuits.

The court was scheduled to hear the case Nov. 6, but both parties asked for the delay while they negotiate a settlement.

Leidos Inc. is challenging a decision in favor of the $31 billion Indiana Public Retirement System, Indianapolis, for losses tied to allegedly misleading initial public offering documents. At issue is the Securities and Exchange Commission's regulation S-K, which requires companies to disclose "any known trends or any known demands, commitments, events or uncertainties that will result in or that are reasonably likely to result in the registrant's liquidity increasing or decreasing in any material way."

The pension fund claimed in its lawsuit that Leidos failed to disclose in its IPO filings liability connected with a kickback scam during a period when the company known as Science Applications International Corp. was building a computerized payroll system for New York City. Two SAIC employees were charged and SAIC paid more than $500 million in fines to settle related claims.

Indiana pension executives declined to comment and Leidos officials could not be reached.