On June 13, the Supreme Court issued a decision in favor of Janus Capital Group, Inc. (JCG) and Janus Capital Management LLC (JCM) in Janus Capital Group, Inc., et al. v. First Derivative Traders, a Rule 10b-5 private action brought by First Derivative Traders against JCG and its wholly owned subsidiary JCM. First Derivative Traders alleged that JCG and JCM were liable for material false statements in mutual fund prospectuses filed by Janus Investment Fund, a mutual fund for which JCM acted as the investment adviser. The Court held that for purposes of Rule 10b-5, the maker of a statement is the person or entity with ultimate authority over the statement. The Court found that Janus Investment Fund was a separate legal entity owned entirely by mutual fund investors and only one member of Janus Investment Fund’s board of trustees was associated with JCM and, accordingly, JCG and JCM did not have ultimate authority over the statements in question and were not liable under Rule 10b-5. The Court declined to reapportion this Rule 10b-5 liability despite the close relationship between investment advisers and the mutual funds they advise, stating that any such reallocation was the responsibility of Congress. SCOTUS Opinion.