A judicially created doctrine that protects issuers of securities and those acting on their behalf from securities fraud claims based on forward-looking statements, if those statements contain adequate cautionary language. The bespeaks caution doctrine holds that forward-looking statements are not misleading if they are accompanied by adequate risk disclosure to caution readers about specific risks that may materially impact the forecasts. (See, for example, Grossman v. Novell, Inc., 120 F.3d 1112, 1120,1123 (10th Cir. 1997).) It applies to:

Courts applying the bespeaks caution doctrine generally reason that meaningful cautionary language reduces or negates the reasonableness of reliance on the forward-looking statements and the materiality of those statements. The cautionary language must be meaningful and tailored to the specific issuer, its business and projections. Boilerplate or vague cautionary language does not suffice.

For more on the bespeaks caution doctrine, see Practice Note, Forward-looking Statements: Securing the Safe Harbor: Bespeaks Caution Doctrine.