...Richard A. Cazier; Kenneth J. Merkley; John S. Treu ABSTRACT Prior research finds that positive tone in firms' qualitative disclosures increases the risk of shareholder lawsuits. However, federal securities laws provide a safe harbor intended to shield firms' forward-looking statements from legal...

... and entitled to financial compensation when available evidence suggests that management knowingly issued false or misleading forward-looking statements—even if disclaimed. Together, these results provide support for recent judicial efforts to erode the sweeping safe harbor provisions currently granted...

... securities litigation safe harbor rules-based standards principles-based standards Many practitioners and members of the popular press decry the rules-based nature of U.S. GAAP and propose the adoption of standards that are more principles-based (see, e.g...