[tinktank]

Hypothetical question: Let's say a news source writes a story that tanks a company's stock price and then, over the course of time the company is able to prove the story is false and/or the news source is unable to back up the story. Can the company sue the newspaper for damages?

[HeWhoLurksLate]

Oh, like Bloomberg's The Big Hack?

[closetohome]

First thing that came to mind. As far as I know they're still claiming it was accurate.

[shaklee3]

They can claim whatever they want. But they have no proof, and there has been plenty of counter evidence.

[blueboo]

And it certainly hasn’t been proven false

[lame-robot-hoax]

I mean they’re the ones making the claim, the onus probandi lies with them.

[mehrdadn]

I completely forgot about that. Did anything come of it?

[Havoc]

Made good money off that one :D

[marktangotango]

Interesting, can you provide more detail?

[Havoc]

Nothing super fancy

After their stock crashed there was a small window of time where the tech crowd had concluded the claim is bullshit but the stock didn't go back up.

Checked out their financials and that seemed fine so stuck money in it and waited for it to recover

[HeWhoLurksLate]

My guess is that he shorted SuperMicro during that time period- that makes the most sense to me.

[z2]

Or the opposite, as in buying the stock when it was down and seeing it nearly double since then.

[A2017U1]

Why not both? As a party with inside knowledge you can profit in both directions easily.

[Havoc]

No bought after the crash. And no, no insider info. Just willingness to take a bit of risk

[nevi-me]

I'm not being my answer on any laws, but am replying with the eye of an investor.

A story or rumour affecting the short term price of a company stock, might leave little recourse to the company, as that price can return back to what it was relatively quickly. There would have been some reputation damage, but I wouldn't weigh stock price to be a good measure of that.

If the company was maybe in the middle of raising funds, say bonds from the market, or using additional shares; they would have stronger case if the false story hindered such find raising.

A company is often not affected by short-term fluctuations in its external "value".

If in the other hand, there's an investor who was adversely affected by such news, the stock price directly affects them. Perhaps they would have a stronger case.

This is my opinion based on my intuition.

[nradov]

Even if the company can prove that the newspaper engaged in libel it would be difficult to establish compensatory damages. Regardless of stock price changes, the company hasn't lost any assets. They might have a shot at getting legal fees plus some punitive damages depending on how egregious the newspaper's conduct was.

[clhodapp]

It would be the shareholders that would have grounds for a suit rather than the company itself, I would think.

[yoz-y]

A tanking stock might lose the company some employees though.

[danso]

AMD in this case would likely have to meet the public figure standard of proving defamation, which would mean proving the WSJ was grossly negligent or knowingly published false claims.

[testvox]

They are probably not an all-purpose public figure, depending on the particular facts they could end up being considered a limited-purpose public figure. But even private figures must prove at least negligence to have a successful defamation claim.

[staticautomatic]

I work in the law and I'm not 100% sure what the case law is on this but my guess is that if you could prove that they knew (or should have known) what they were publishing was false, then yes. First amendment lawyers please correct me if I'm wrong.

[testvox]

Yeah in general if the untrue statement was made without at least negligence then it will be protected.

> Statements made in a good faith and reasonable belief that they were true are generally treated the same as true statements; however, the court may inquire into the reasonableness of the belief. The degree of care expected will vary with the nature of the defendant: an ordinary person might safely rely on a single newspaper report, while the newspaper would be expected to carefully check multiple sources.

[d-sc]

You can generally sue for anything you feel like.

However if the press demonstrates that they followed reasonable journalistic practices and weren’t blatantly lying, they’d be fine.

[mnky9800n]

This is basically how Donald Trump tried to make money in the stock market in the 1980s.