How does Supreme Court precedent affect lower court decisions when there is asymmetric probability of appellate review? Using securities fraud class actions filed between 2003 and 2007, we study the impact of a widely-followed Supreme Court decision from that period, Tellabs, Inc. v. Makor...

Using a sample of securities fraud class actions filed between 2003 and 2007, we study the impact of a widely-followed Supreme Court decision from that period, Tellabs, Inc. v. Makor Issues & Rights, Ltd. This decision clarified the law with respect to one of the most contested issues in...