Introduction
In December 2020 the Supreme Court handed down a decision in relation to certain obligations of lead underwriters and bookrunners in an initial public offering (IPO).(1) Although the underlying facts related to an IPO, the judgment also applies to underwriters involved in the submission of a securities registration statement and there are useful takeaways for any company faced with investigating allegations of impropriety made by a whistleblower.
The case related to a now bankrupt semiconductor manufacturer, FOI, which was listed on the Market of the High-Growth and Emerging Stocks (Mothers) Index of the Tokyo Stock Exchange (TSE) in 2009.(2) Mizuho Securities Company Limited acted as lead underwriter for FOI in its IPO.