Kara Baquizal


This Note argues that the conduct-and-effects test set out in Dodd-Frank should not extend to private rights of action under § 10(b) of the Exchange Act. Part I discusses three principle ideas key to understanding US securities law and its extraterritorial application: the framework of US regulations surrounding securities fraud; the availability of a private right of action in the United States and how it compares with the regulatory regimes of other countries; and the presumption against extraterritoriality in American law. Part II explains the conflicting tests that currently exist in American jurisprudence regarding the extraterritorial reach of § 10(b): the conduct-and-effects test in Dodd-Frank and the bright-line transactional test articulated in Morrison. Finally, Part III argues that the SEC study required by Dodd-Frank should conclude that the proposed test in Dodd-Frank is inappropriate for determining the availability of § 10(b) to a private class action involving non-US parties and, instead, the transactional test articulated in Morrison should be upheld.