United States First Circuit

In a putative class action suit filed by investors against the company and its former chief executive officer following a drop in the share price of the company's common stock, alleging securities fraud in violation of Sections10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. sections 78j(b) and 78t(a), as well as the Securities and Exchange Commission's (SEC) Rule 10b-5, 17 C.F.R. section 240.10b-5, averring defendants inflated the value of its common stock for about five months in 2013 by issuing false or materially misleading press releases concerning the approval of human clinical trials for a new medical device the company was developing that failed to identify the caveats and conditions imposed by the Food and Drug Administration (FDA) for the clinical trials, the district court's grant of defendants' motion to dismiss is affirmed where: 1) plaintiff has failed to allege false or misleading statements sufficient to state a claim under Section 10(b) and Rule 10b-5, and; 2) having failed to plead a viable claim of a primary violation, plaintiff's control person claim against defendant under Section 20(a) was also properly dismissed.

Appellate Information

• Published 2017/01/09

Judges

• LIPEZ

Court

• United States First Circuit

Counsel