Case Updates
Outcome
December 05, 2006
In a dramatic victory for the business community, the Second Circuit affirmed strict standards for achieving class certification. The Second Circuit concluded that the district court’s willingness to accept “some showing” of the Rule 23 elements was far too weak in light of the importance of the Rule 23 requirements for class certification.
U.S. Chamber files amicus brief on the merits
October 12, 2005
In this case, the district court ruled that 55 investment banks and over 300 public companies must face over 300 class action suits over charges they used IPO allocations to inflate stock prices during the late 1990’s market boom. In its amicus brief, NCLC argued that the district court abandoned the “rigorous analysis” standard that trial courts must use to examine plaintiffs’ class action allegations. The court’s relaxation of the class certification standard meant that the plaintiffs were not required to show that an efficient market took account of any of the defendants’ alleged misrepresentations, that the plaintiffs actually relied on the price of the securities as an accurate reflection of their value, or that there was a causal link between the allegedly fraudulent scheme and the price of the securities at issue.
Review granted
June 30, 2005
The Fourth Circuit granted review pursuant to FRCP 23(f).
U.S. Chamber urges Fourth Circuit to review securities class action certification
October 27, 2004
The U.S. Chamber filed an amicus brief in support of review. In this case, the district court ruled that 55 investment banks and over 300 public companies must face over 300 class action suits over charges they used IPO allocations to inflate stock prices during the late 1990’s market boom. NCLC's brief argued that the district court abandoned the “rigorous analysis” standard that trial courts must use to examine plaintiffs’ class action allegations. The court’s relaxation of the class certification standard meant that the plaintiffs were not required to show that an efficient market took account of any of the defendants’ alleged misrepresentations, that the plaintiffs actually relied on the price of the securities as an accurate reflection of their value, or that there was a causal link between the allegedly fraudulent scheme and the price of the securities at issue.