One way to prove loss causation in a securities fraud suit is to show that the defendant corporation’s stock, traded in an efficient market, dropped significantly after a disclosure of information correcting the prior misrepresntations on which the plaintiff sues.  The plaintiff must also show that the corrective disclosure was a substantial factor in causing the stock drop.  This decision holds that allegations made in a new suit publicly filed against the corporation can, under cerrtain circumstances, constitute a corrective disclosure for these purposes.  That they are mere “allegations” does not disqualify the suit’s assertions since any corrective disclosure other than the defendant’s admission of a prior fraud is to some extent contestable assertions of purported fact.  What is important is whether the market would reasonably take the suit’s allegations as probably true.  Here, that condition was satisfied as the suit was by an insider whistleblower and detailed facts that showed wrongdoing that he reported to management.  By contrast blog posts by someone else did not qualify as corrective disclosures because they were of public information which while painstakingly assembled from disparate sources (and thus possibly not previously known to the market) were also made by short sellers who had a financial interest in driving down the stock price and their blog warned that it did not vouch for the truth of the facts it stated.