Whether evidence of unrelated prior convictions is admissible in securities fraud cases as direct proof of a fraud under Rule 10b-5, even though there is otherwise no pre-existing duty to disclose, solely upon a showing investors might consider omissions of those unrelated prior convictions material

QUESTION PRESENTED FOR REVIEW Federal Rule of Evidence 404(b) and this Court’s decision in Michelson v. United States, 335 U.S. 469 (1948), prohibit admission of unrelated prior convictions evidence in criminal trials. In cases arising under federal securities fraud law, this Court has held silence is not misleading under Rule 10b-5 absent a pre-existing duty to disclose, Basic Inc. v. Levinson, 485 U.S. 224, 239 (1988), and that failure to disclose is only fraudulent only upon showing of a specific pre-existing duty to disclose, Matrixx Initiatives, Inc. v. Siracusano, 563 U.S. 27, 45 (2011). Notwithstanding this clear precedent, the Second, Sixth, and Eleventh Circuits have held evidence of prior convictions is admissible as “direct proof’ in prosecutions alleging securities fraud under Rule 10b-5, so long as an investor would consider the prior convictions “material.” The question presented is: Whether evidence of unrelated prior convictions is admissible in securities fraud cases as direct proof of a fraud under Rule 10b-5, even though there is otherwise no pre-existing duty to disclose, solely upon a showing investors might consider omissions of those unrelated prior convictions material. i