Supreme Court won’t reinstate Pennsylvania judge suspended for partisan Facebook posts

The US Supreme Court has declined to hear Zillow Group's appeal against a lower court's decision to allow a 2021 class action lawsuit to proceed. The case centers on whether publicly traded companies can raise defenses in lawsuits alleging they made false statements to investors. In this particular class action, known as a price-maintenance case, plaintiffs allege that Zillow misled investors about its failed home-flipping venture.

Zillow's stock plummeted in November 2021 after the company announced it was permanently closing its Zillow Offers division due to inability to accurately predict home prices. The company disclosed $300 million in losses and laid off 25% of its workforce. Zillow's lawyers argue that the company's decisions to enter a new business and disclose its risks were honest.

The 9th US Circuit Court of Appeals upheld the lower court's decision, stating that Zillow's disclosures revealed new information about the impact of its pricing model's failure. Zillow's appeal asked the Supreme Court to resolve a split among federal appellate courts regarding the relevance of a company's corrective disclosures to earlier alleged misstatements.

Pro-business groups criticized the 9th Circuit's decision, arguing that it deviated from Supreme Court precedent and would make American businesses more susceptible to costly securities class-action lawsuits.