Connecticut Retirement Plans and Trust Funds v. Amgen Inc., et al.

Plaintiff brought this securities fraud action against defendant, a biotechnology company and several of its officers, alleging that, by misstating and failing to disclose safety information about two of the company's products used to treat anemia, they violated the Securities and Exchange Act of 1934, 15 U.S.C. 78j(b), 78t(a), and Rule 10b-5, 17 C.F.R. 240.10b-5. At issue was what a plaintiff must do to invoke a fraud-on-the-market presumption in aid of class certification. The court joined the Third and Seventh Circuits in holding that plaintiff must (1) show that the security in question was traded in an efficient market, and (2) show that the alleged misrepresentation were public. As for the element of materiality, plaintiff must plausibly allege that the claimed misrepresentations were material. In this case, plaintiff plausibly alleged that several of defendants' public statements about its pharmaceutical products were false and material. Coupled with the concession that the company's stock traded in an efficient market, this was sufficient to invoke the fraud-on-the-market presumption of reliance. Therefore, the district court did not abuse its discretion in certifying the class.