Supreme Court Reverses Ruling Against Slack Technologies Over Direct Listing
The Supreme Court ruled in favor of a Big Tech company on June 1, issuing a unanimous ruling that limits the power of shareholders to sue over companies’ misleading statements made when they sell shares in a direct listing.
Justice Neil Gorsuch wrote the court’s 9–0 opinion (pdf) in Slack Technologies v. Pirani (court file 22-200). Slack is a unit of Salesforce Inc., a business software maker that is headquartered in San Francisco.
Slack, an instant-messaging company, was accused of making false statements in connection with public disclosures it made in 2019 when it offered corporate shares for sale.
Slack, based in San Francisco, was purchased for almost $28 billion in a cash and stock transaction. But instead of going the usual route and making a formal public stock offering, the company made a direct listing after the U.S. Securities and Exchange Commission approved the alternative procedure in 2018….