United States Sixth Circuit

In a class action securities-fraud lawsuit against Diebold, Inc., brought by investors alleging that between 2003 and 2005 Diebold engaged in a series of schemes to prematurely recognize revenue in order to inflate the price of its stock, dismissal of the lawsuit for failure to state a claim is affirmed where: 1) plaintiffs' request for remand is unnecessary as the record reflects that the district court ultimately applied the correct pleading standard; 2) neither the complaint nor the proposed second amended complaint states with particularity facts giving rise to a strong inference that the defendants acted with the required state of mind; and 3) any inference of scienter is not cogent as required by Tellabs, but speculative and supported only by general and conclusory allegations that fail to connect the defendants to the alleged scheme.

Appellate Information

• Argued 10/14/2009
• Decided 12/22/2009
• Published 12/22/2009

Judges

• Before: GILMAN and GIBBONS, Circuit Judges; ANDERSON, District Judge.

Court

• United States Sixth Circuit

Counsel

• For Appellees:
  
• ARGUED:Geoffrey M. Johnson, Scott & Scott, LLP, Cleveland Heights, Ohio, for Appellants. John M. Newman, Jr, Jones Day, Cleveland, Ohio, for Appellees. ON BRIEF:Geoffrey M. Johnson, Scott & Scott, LLP, Cleveland Heights, Ohio, for Appellants. John M. Newman, Jr, Geoffrey J. Ritts, Jones Day, Cleveland, Ohio, John F. McCaffrey, McLaughlin & McCaffrey, Cleveland, Ohio, John D. Parker, Baker & Hostetler, Cleveland, Ohio, D. Jeffrey Ireland, Martin A. Foos, Faruki, Ireland & Cox P.L.L., Dayton, Ohio, Donna M. Donlon, McKenna Long & Aldrige, LLP, Washington, D.C., for Appellees.