SIFMA Amicus Brief on the Duty of an Underwriter to an Issuer

SIFMA filed an amicus brief, in a case involving the underwriting in 1999 of the eToys IPO, which supports the position that the lead underwriter in an initial public offering does not owe a fiduciary duty to the issuer of securities to disclose conflicts of interest in connection with the pricing of the securities. The case against the underwriter was brought by a committee of eToy's creditors. SIFMA's amicus brief provides a review of considerations as to why such a fiduciary standard should not be imposed on underwriters where it is not set forth in the underwriting contract itself.

View Brief in full here (Links to PDF).See also: NYTimes Article - Rigging the I.P.O. Game (March 9, 2013).