Harris v. Amgen

Case Updates

The petition for rehearing was denied.

The Chamber filed an amicus brief urging the Ninth Circuit to grant rehearing or rehearing en banc to consider the detrimental effect that the panel's opinion will have on the voluntary employment-based system. The Chamber argued that ERISA stock drop lawsuits are undermining employers' commitment to the voluntary employment-based retirement system and particularly to offering company stock as an investment option. The Chamber pointed out that if fiduciaries will be sued no matter what action they take, so long as the stock price drops, and if companies continue to face million-dollar settlements from these cases, then employers may stop offering company stock as an investment option and, even more concerning, may scale back their plan benefits.

The Chamber argued that the panel's decision exacerbates these trends because the panel's decision blurs ERISA's fiduciary lines and removing important protections granted to defendants against meritless securities masquerading as ERISA claims, the panel's decision undermines the vitality of the employer-sponsored retirement system. The Chamber also pointed out that the panel's decision also encourages frivolous lawsuits that are merely securities fraud cases cloned for ERISA by taking away one of the few protections available to defendants in ERISA lawsuits, namely that the plaintiffs must show that they relied to their detriment on any alleged misrepresentations.