Trustees of the Welfare and Pension Funds of Local 464A, The v. Medtronic plc
U.S. District Court, District of Minnesota
Trustees of the Welfare and Pension Funds of Local 464A, The v. Medtronic plc
Trial Court Opinion
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
The Trustees of the Welfare and Pension No. 22-cv-2197 (KMM/JFD)
Funds of Local 464A - Pension Fund,
Individually and on Behalf of All Others
Similarly Situated, et al.,
Plaintiffs,
ORDER
v.
Medtronic plc, et al.,
Defendants.
On March 28, 2024, the Court granted the Defendants’ motion to dismiss the
Plaintiffs’ Consolidated Amended Complaint in this private securities-fraud case.
Dismissal Order, ECF 81. In the Dismissal Order, the Court found, generally, that
(1) Plaintiffs’ failed to allege actionable misrepresentations and omissions, and (2)
Plaintiffs’ misrepresentation and scheme claims failed because the allegations did not
support a strong inference of scienter. Although the Court found that the Plaintiffs failed to
state a claim, the Court did not enter judgment because Plaintiffs made a conditional
request for leave to file an amended complaint if the Court disagreed with their position
that the Consolidated Amended Complaint was adequate.1 Accordingly, the Court gave
Plaintiffs an opportunity to file motion to amend the Complaint. Dismissal Order at 85–86.
1 See Plymouth Cnty., Iowa ex rel. Raymond v. MERSCORP, Inc., 287 F.R.D. 449, 455 (N.D. Iowa
2012) (describing a suggestion of amendment in a memorandum opposing a motion to dismiss as
a “conditional request for leave to amend [, which] requests leave to file an amended complaint
only if the court grants an opposing party’s motion to dismiss”) (emphasis in original).
On April 29, 2024, Plaintiffs filed their Motion for Leave to File a First Amended
Consolidated Class Action Complaint for Violations of the Federal Securities Laws. Pls.’
Mot. to Am., ECF 82. Plaintiffs attached a clean and redlined version of their proposed
First Amended Consolidated Class Action Complaint (“Proposed FACC”). ECF 82-1, 82-
2. Defendants opposed the motion on futility grounds, arguing that the Proposed FACC did
not cure deficiencies in the Plaintiffs’ allegations of scienter and suffered from other defects
in pleading. Defs.’ Opp’n, ECF 88. Defendants also indicated that, should the Court allow
the amendment, they would then file a motion to dismiss that more fully explores the legal
inadequacy of the proposed amended complaint. Id. at 14 n.6. The Court held a hearing on
the motion on June 10, 2024. Mins. of Hr’g, ECF 91. During the hearing, the Court
discussed with defense counsel the pragmatics of the Court first conducting a futility
analysis and then, in a piecemeal fashion, applying essentially the same standard on a
subsequent motion to dismiss. Hr’g Tr. 32–38, ECF 94. Following the hearing, the parties
submitted additional materials regarding supplemental authority. ECF 95, 96.
The Court has carefully reviewed all the briefing filed by the parties and the
Proposed FACC. That review suggests that Plaintiffs have made important and potentially
compelling changes to the pleading designed to address the Court’s overarching concerns
about insufficient allegations of scienter and inactionable statements. Most critically, as to
scienter, the Proposed FACC alleges more clearly how certain Defendants’ representations
to the marketplace about the progress toward approval of the 780G device could be read to
misrepresent the character of their interactions with the FDA and a potential timeline for
completion of remediation efforts in response to a Form 483. This level of detail regarding
Defendants’ interactions with the FDA and the Form 483’s potential connection to approval
of the 780G was not included in the version of the complaint the Court addressed in the
Dismissal Order. While the Court is not now ultimately deciding that Plaintiffs’ allegations
would survive a challenge under Rule 12(b)(6), rejection of their Proposed FACC for
failure to state a claim is not a foregone conclusion.
Because the Defendants have pledged a more fulsome challenge to the Proposed
FACC if amendment is allowed, some of which would cover the same ground raised in
their opposition to the motion to amend, see Hr’g Tr. 35–36, the Court finds it would be
inefficient to issue a decision addressed to Defendants’ futility arguments, and then
potentially apply the same legal standard on a second motion to dismiss. Such a decision
falls within the Court’s discretion. See, e.g., Lau v. Ambani, No. 16-cv-6288, 2017 WL
7693353, at *2 (E.D. Pa. Aug. 11, 2017) (reasoning that the defendants’ futility arguments would “be better addressed in any renewed motions [to dismiss] based on the amended complaint so that all relevant grounds for dismissal may be presented in comprehensive motions, and the Court declines to engage in further analysis at this time”); see also Chen v. Yellen, No. 3:20-cv-50458,2021 WL 5005373
, at *2–3 (N.D. Ill. Oct. 28, 2021)
(declining to engage in a futility analysis in favor of considering motions to dismiss and
collecting cases doing the same).
Therefore, the Court will provisionally grant Plaintiffs’ motion to amend, and
Plaintiffs are permitted to file their Proposed FACC. After Plaintiffs file the Proposed
FACC, Defendants are permitted to file a renewed motion to dismiss that contains all of
their challenges to the new pleading, both those already raised in the opposition to the
motion to amend amendment and any arguments Defendants reserved, but did not raise in
that opposition.
Consistent with the foregoing, IT IS HEREBY ORDERED THAT:
1. Plaintiffs’ Motion for Leave to File a First Amended Consolidated Class Action
Complaint for Violations of the Federal Securities Laws, ECF 82, is
provisionally GRANTED as stated herein;
2. Within three business days of the date of this Order, Plaintiffs shall file their First
Amended Consolidated Class Action Complaint for Violations of the Federal
Securities Laws in the same form as the Proposed FACC attached as Exhibit A
to the motion to amend. ECF 82-1.
3. Within fourteen days of the date of this Order, the parties must meet and confer
regarding a proposed briefing schedule for Defendants’ renewed motion to
dismiss and file a stipulation to that effect. When the parties’ file their stipulation,
unless the Court deems the parties’ proposal unreasonable, the Court will adopt
their agreed upon briefing schedule and issue a text order setting forth the same.
4. The Court will not hold a hearing on Defendants’ renewed motion to dismiss
unless, following review of the parties’ memoranda, it determines that additional
argument is necessary.
Date: October 18, 2024 s/Katherine Menendez
Katherine Menendez
United States District Judge Trial Court Opinion
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
The Trustees of the Welfare and Pension No. 22-cv-2197 (KMM/JFD)
Funds of Local 464A - Pension Fund,
Individually and on Behalf of All Others
Similarly Situated, et al.,
Plaintiffs,
ORDER
v.
Medtronic plc, et al.,
Defendants.
On March 28, 2024, the Court granted the Defendants’ motion to dismiss the
Plaintiffs’ Consolidated Amended Complaint in this private securities-fraud case.
Dismissal Order, ECF 81. In the Dismissal Order, the Court found, generally, that
(1) Plaintiffs’ failed to allege actionable misrepresentations and omissions, and (2)
Plaintiffs’ misrepresentation and scheme claims failed because the allegations did not
support a strong inference of scienter. Although the Court found that the Plaintiffs failed to
state a claim, the Court did not enter judgment because Plaintiffs made a conditional
request for leave to file an amended complaint if the Court disagreed with their position
that the Consolidated Amended Complaint was adequate.1 Accordingly, the Court gave
Plaintiffs an opportunity to file motion to amend the Complaint. Dismissal Order at 85–86.
1 See Plymouth Cnty., Iowa ex rel. Raymond v. MERSCORP, Inc., 287 F.R.D. 449, 455 (N.D. Iowa
2012) (describing a suggestion of amendment in a memorandum opposing a motion to dismiss as
a “conditional request for leave to amend [, which] requests leave to file an amended complaint
only if the court grants an opposing party’s motion to dismiss”) (emphasis in original).
On April 29, 2024, Plaintiffs filed their Motion for Leave to File a First Amended
Consolidated Class Action Complaint for Violations of the Federal Securities Laws. Pls.’
Mot. to Am., ECF 82. Plaintiffs attached a clean and redlined version of their proposed
First Amended Consolidated Class Action Complaint (“Proposed FACC”). ECF 82-1, 82-
2. Defendants opposed the motion on futility grounds, arguing that the Proposed FACC did
not cure deficiencies in the Plaintiffs’ allegations of scienter and suffered from other defects
in pleading. Defs.’ Opp’n, ECF 88. Defendants also indicated that, should the Court allow
the amendment, they would then file a motion to dismiss that more fully explores the legal
inadequacy of the proposed amended complaint. Id. at 14 n.6. The Court held a hearing on
the motion on June 10, 2024. Mins. of Hr’g, ECF 91. During the hearing, the Court
discussed with defense counsel the pragmatics of the Court first conducting a futility
analysis and then, in a piecemeal fashion, applying essentially the same standard on a
subsequent motion to dismiss. Hr’g Tr. 32–38, ECF 94. Following the hearing, the parties
submitted additional materials regarding supplemental authority. ECF 95, 96.
The Court has carefully reviewed all the briefing filed by the parties and the
Proposed FACC. That review suggests that Plaintiffs have made important and potentially
compelling changes to the pleading designed to address the Court’s overarching concerns
about insufficient allegations of scienter and inactionable statements. Most critically, as to
scienter, the Proposed FACC alleges more clearly how certain Defendants’ representations
to the marketplace about the progress toward approval of the 780G device could be read to
misrepresent the character of their interactions with the FDA and a potential timeline for
completion of remediation efforts in response to a Form 483. This level of detail regarding
Defendants’ interactions with the FDA and the Form 483’s potential connection to approval
of the 780G was not included in the version of the complaint the Court addressed in the
Dismissal Order. While the Court is not now ultimately deciding that Plaintiffs’ allegations
would survive a challenge under Rule 12(b)(6), rejection of their Proposed FACC for
failure to state a claim is not a foregone conclusion.
Because the Defendants have pledged a more fulsome challenge to the Proposed
FACC if amendment is allowed, some of which would cover the same ground raised in
their opposition to the motion to amend, see Hr’g Tr. 35–36, the Court finds it would be
inefficient to issue a decision addressed to Defendants’ futility arguments, and then
potentially apply the same legal standard on a second motion to dismiss. Such a decision
falls within the Court’s discretion. See, e.g., Lau v. Ambani, No. 16-cv-6288, 2017 WL
7693353, at *2 (E.D. Pa. Aug. 11, 2017) (reasoning that the defendants’ futility arguments would “be better addressed in any renewed motions [to dismiss] based on the amended complaint so that all relevant grounds for dismissal may be presented in comprehensive motions, and the Court declines to engage in further analysis at this time”); see also Chen v. Yellen, No. 3:20-cv-50458,2021 WL 5005373
, at *2–3 (N.D. Ill. Oct. 28, 2021)
(declining to engage in a futility analysis in favor of considering motions to dismiss and
collecting cases doing the same).
Therefore, the Court will provisionally grant Plaintiffs’ motion to amend, and
Plaintiffs are permitted to file their Proposed FACC. After Plaintiffs file the Proposed
FACC, Defendants are permitted to file a renewed motion to dismiss that contains all of
their challenges to the new pleading, both those already raised in the opposition to the
motion to amend amendment and any arguments Defendants reserved, but did not raise in
that opposition.
Consistent with the foregoing, IT IS HEREBY ORDERED THAT:
1. Plaintiffs’ Motion for Leave to File a First Amended Consolidated Class Action
Complaint for Violations of the Federal Securities Laws, ECF 82, is
provisionally GRANTED as stated herein;
2. Within three business days of the date of this Order, Plaintiffs shall file their First
Amended Consolidated Class Action Complaint for Violations of the Federal
Securities Laws in the same form as the Proposed FACC attached as Exhibit A
to the motion to amend. ECF 82-1.
3. Within fourteen days of the date of this Order, the parties must meet and confer
regarding a proposed briefing schedule for Defendants’ renewed motion to
dismiss and file a stipulation to that effect. When the parties’ file their stipulation,
unless the Court deems the parties’ proposal unreasonable, the Court will adopt
their agreed upon briefing schedule and issue a text order setting forth the same.
4. The Court will not hold a hearing on Defendants’ renewed motion to dismiss
unless, following review of the parties’ memoranda, it determines that additional
argument is necessary.
Date: October 18, 2024 s/Katherine Menendez
Katherine Menendez
United States District Judge Reference
- Status
- Unknown