In re Worlds of Wonder Securities Litigation
United States Court of Appeals for the Ninth Circuit
35 F.3d 1407 (1994)
Relevant factsFree
World of Wonder, Inc. (WOW) (defendant) had a blockbuster 1986 Christmas season selling Teddy Ruxpin and Lazer Tag, leading its board to forecast continued sales growth and raise capital through a 1987 bond issuance. WOW never repeated its 1986 success and defaulted on the bonds. Bondholders (plaintiffs) sued, alleging the bond prospectus contained material misrepresentations about WOW's financial condition; the district court ruled for WOW, and the bondholders appealed.
IssueFree
Whether an optimistic statement issued by a corporation is misleading if it is properly conditioned.
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