Goldman Ruling Undoing Investor Class Shows New Path for Peers

Goldman Sachs Group Inc.'s recent win in a securities suit over how it disclosed conflicts of interest is likely to resonate with other corporations facing investor class actions.

The Aug. 10 decision by the Second Circuit may well constrain investors’ ability to proceed as a class in other suits against companies, instead requiring them to sue individually if at all, attorneys say. And it shows judges a way of implementing a 2021 US Supreme Court ruling siding with Goldman in an earlier stage of the case.

“In securities litigation, this is very much a landmark decision,” said Todd Cosenza, a ...