Manning v. Merrill Lynch Pierce Fenner & Smith, Inc.

OPINION

SMITH, Circuit Judge.

After the District Court denied Plaintiffs’ motion to remand this case to New Jersey state court, we granted their petition for an interlocutory appeal. The issue before us is whether there is federal-question jurisdiction over Plaintiffs’ state-law claims, which allege that defendants manipulated the price of a stock via abusive “naked” short sales. Short sales are subject to detailed federal regulation under Regulation SHO. New Jersey does not have an analogous provision. However, the question of whether the naked short selling at issue in this case violates New…