Amgen Inc. v. Connecticut Retirement Plans and Trust Funds (11-1085)

argument 11-1085

Amgen Inc. v. Connecticut Retirement Plans and Trust Funds

Supreme Court of the United States 59 min 6 speakers 8 chapters transcribed 7 days ago official recording ↗

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What is the central legal issue in Amgen Inc. v. Connecticut Retirement Plans and Trust Funds?

John G. Roberts 0:01

We'll hear argument next in case eleven ten eighty five AM Gen Incorporated versus the Connecticut Retirement Plans and Trust Funds. Mr Waxman.

Irving L. Waxman 0:11

Mr. Chief Justice, and may it please the court. Our case is about whether the claim of liability is in a fundamental sense class wide or individual. The heart of a ten B five claim is I bought or sold in reliance on a misleading statement The question at the class search stage is whether each individual will have to prove his own reliance directly on the statement or whether everybody he can prove indirectly reliance on the statement by showing that everybody relied on a distorted market price. A market price will reflect a statement if and only if the statement is material and is made publicly on an efficient market. So absent materiality The market price cannot be presumed to reflect the statement in question.

John G. Roberts 1:12

Why is that why is that the case? I would suppose if There's no materiality. That means that the effect on the market price just happens to be zero.

Irving L. Waxman 1:22

That's exactly correct. And the point here is Well

John G. Roberts 1:26

why isn't that common to uh all parties.

Irving L. Waxman 1:29

Mr. Chief Justice, every one of the four predicates to the fraud on the market theory, which is a shortcut that ex that excuses plaintiffs from proving that I heard the statement and relied on it. Every one of those predicates is common. Whether the market is efficient is common. Whether the statement is public is common. Whether the stocks were bought and sold during the period of market distortion is common. And materiality is common. The question is not whether The falsity of the statement is common, but it is not a predicate to whether or not you can prove that the same thing is that the same reliance on a statement indirectly by relying on the integrity of the market price, because in an efficient market, material public statements, whether they are true or false,

Irving L. Waxman 2:24

will presumably move the market price. And if you're trying to prove reliance on a false

Elena Kagan 2:30

individual who ha it has been deemed in in in a search certification that an issue is immaterial. Could a individual claimant ever prove its material? Sure. I'm not on a truth on the market. truth in the market defense, which is the type of defense that you are raising here.

Irving L. Waxman 2:51

Yes. Either way, let me explain why. There is no doubt that this Court's standard for materiality, announced in TSC versus Northway and since reiterated, is an objective standard. It doesn't depend on who the relier was. But the inability to prove to a certifying judge that class wide reliance can be that class wide reliance exists because the statement was material doesn't preclude A plaintiff like Connecticut retirement, which has said it's going to proceed whether there's a class or not. or any other member of the class from coming to court and saying either I directly relied on this statement and here's my proof that it's material to the trier of fact because the decision that the judge makes at certification is not binding on the trier of fact, or even to say I relied on the integrity of the market price and I have proof that the

Irving L. Waxman 3:55

Market price was affected because here are three investors. They're all reasonable people, and they say that it was relevant to them in the total mix of information. Well mister

Anthony M. Kennedy 4:06

Mr Westman that's just to say that you uh a plaintiff can always relitigate the question of materiality. But at the class certification stage, isn't it correct? that if the court holds that a statement is immaterial, it's immaterial for all members of the class and the suit has to be dismissed. Isn't that right?

Irving L. Waxman 4:26

The suit cannot that is the suit cannot proceed as a class action. Connecticut retirement or anything

Anthony M. Kennedy 4:33

proceed as an anything action, can it? I mean the the the remedy, if you thought that the the statement was immaterial is not to say um uh I won't approve a class, it would be to say the suit has no merit.

Irving L. Waxman 4:49

I I I think that's wrong. I think that's conceptually wrong, Justice Kagan, in the sense that all that the class certification decision says is that the putative class represent representative can sue on his own behalf, but he can't drag everybody else in the end.