On September 18, 2023, Judge Manish S. Shah of the United States District Court for the Northern District of Illinois narrowed a putative class action asserting claims under the Securities Exchange Act of 1934 against an airplane manufacturer and its former CEO and CFO. College Ret. Equities Fund v. Boeing Co., 2023 WL 6065260 (N.D. Ill. Sept. 18, 2023). Plaintiffs alleged the company made misrepresentations regarding two crashes of a new model of plane and the company’s responsive measures in an effort to return the fleet to service. The Court held that various challenged statements were not actionable because plaintiffs failed to adequately allege falsity or scienter. With respect to the remaining challenged statements, the Court further pared the claims by holding that loss causation was not sufficiently alleged in connection with certain purported corrective disclosures.
The Court first explained that challenged statements made before the accidents were not actionable, because plaintiffs either failed to allege falsity or failed to adequately allege scienter. For example, the Court held that while the Company’s statement that the airplane’s “FAA certification affirms that the airplane’s handling, systems and overall performance all comply with required aviation regulations” omitted material detail, plaintiffs failed to allege that those who made and approved that statement knew at the time it was made that it was false. Id. at *5–6. The Court further determined that...
Last week, the US jobless claims report stole the show as initial claims jumped to a new cycle high and the highest level since 2021. That triggered a more dovish repricing in interest rates expec...