Safron Capital Corp. v. Leadis Technology, Inc.
Safron Capital Corp. v. Leadis Technology, Inc.
Dissenting Opinion
dissenting.
I would affirm for the reasons stated by Judge Breyer.
Opinion of the Court
MEMORANDUM
Appellants Ngoan Van Le, Richard Beedenbender, and Scott Strouse appeal the district court’s order dismissing with prejudice their Consolidated Class Action Complaint (“Complaint”) alleging violations of Sections 11, 12(a)(2), and 15 of the Securities Act of 1933, 15 U.S.C. §§ 77k, 77£(a)(2), and 77o, in connection with Lead-is Technology Inc.’s June 2004 initial public offering of common stock. In conducting our review, we accept the allegations in the dismissed complaint as true and construe them in the light most favorable to Appellants. In re Daou Systems, Inc. Secs. Litig., 411 F.3d 1006, 1013 (9th Cir. 2005). We have jurisdiction pursuant to 28 U.S.C. § 1291, and we reverse and remand.
As a preliminary matter, we address Appellees’ motion to strike Appellants’ opening brief and Appellants’ request for judicial notice. The motion to strike is granted as follows: all documents in the Addendum to Appellants’ opening brief are stricken except the district court’s order in In re BioLase Tech. Sec. Litig., No. 04-947 DOC (C.D.Cal. Jan. 27, 2003).
Fraud is not an essential element of the claims raised in the Complaint, and the
Here, the Complaint does not rely upon a unified course of fraudulent conduct. Indeed, Appellants do not allege a claim under Section 10(b) of the Securities Exchange Act — a claim that would require them to allege fraud. Nor do they allege facts in the complaint that necessarily constitute fraud. Accordingly, the allegations in the Complaint do not “sound in fraud,” and we conclude that the Complaint is not properly subject to the heightened pleading requirements of Rule 9(b). See Vess, 317 F.3d at 1105.
Because we reverse and remand on this basis, we do not reach Appellants’ additional argument that the district court abused its discretion by dismissing the Complaint with prejudice.
REVERSED and REMANDED.
This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.
. Appellees’ request for monetary sanctions is denied. We note that at oral argument, counsel for Appellants acknowledged that the inclusion of documents in the Addendum that were not properly before the district court violates Rule 10(a) of the Federal Rules of Appellate Procedure and represented that such conduct would not recur. We have no reason to believe that counsel will not abide by his representations.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.