Cooper v. Thoratec Corporation et al

Filing 119

Order by Judge Claudia Wilken granting 98 Motion to Certify Class.(dtmS, COURT STAFF) (Filed on 5/8/2018)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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BRADLEY COOPER, Individually and
on Behalf of all Others Similarly
Situated; TODD LABAK,

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Plaintiffs,

ORDER GRANTING
MOTION FOR CLASS
CERTIFICATION

v.

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THORATEC CORPORATION; GERALD F.
BURBACH; TAYLOR C. HARRIS; and
DAVID SMITH,

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United States District Court
For the Northern District of California

No. 14-cv-0360 CW

Defendants.

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________________________________/
Plaintiffs Bradley Cooper and Todd Labak are investors in

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Thoratec Corporation, a medical device company that manufactures

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the HeartMate II.

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officers, Gerhard F. Burbach, Taylor C. Harris, and David V.

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Smith, made various misrepresentations in order to hide from its

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investors and the public that the HeartMate II’s rates of

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thrombosis were increasing, which would have adversely affected

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the stock price of Thoratec.

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behalf of themselves and a putative class, alleging violations of

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Sections 20(a) and 10(b) of the Securities Exchange Act, 15 U.S.C.

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§ 78j(b), and Rule 10b-5 promulgated thereunder.

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Court is Plaintiffs’ Motion for Class Certification.

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reasons stated below, the Court grants Plaintiffs’ motion.

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They allege that Thoratec and certain of its

They bring this suit for damages on

Now before the
For the

BACKGROUND
Thoratec is a medical device company that manufactures and

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markets a Ventricular Assist System (VAS), the HeartMate II.

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Second Amended Complaint (SAC) (Dkt. No. 49) ¶¶ 34–35.

During the

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relevant period between May 11, 2011 and August 6, 2014 (the Class

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Period), Thoratec’s common stock traded on the NASDAQ Global

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Market under the ticker symbol “THOR.”

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defendants Burbach, Harris, and Smith were directors or officers

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of Thoratec during the Class Period.1

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Id. ¶ 29.

Individual

On April 21, 2008, HeartMate II received approval from the

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FDA for certain applications.

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summary of safety and effectiveness data for the HeartMate II,

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which demonstrated a two percent rate of thrombosis for all

United States District Court
For the Northern District of California

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SAC ¶ 41.

patients as of September 14, 2007.

The FDA published a

Id.

Thoratec was the sole manufacturer of VAS until the HeartWare

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VAS came on the European market in 2009, and reported thrombosis

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rates as low as 3.1 percent.

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approval on November 12, 2012.

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serious threat to Thoratec’s monopoly, especially because

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HeartWare had been disclosing decreasing rates throughout the

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Class Period.

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did not maintain thrombosis rates at the clinical trial rate of 2%

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that HeartWare would end up with the lion share of the market.”

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Id. ¶ 57.

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Id. ¶¶ 50–56.

SAC ¶¶ 48, 50.
Id. ¶ 52.

HeartWare earned FDA

It represented a

Defendants thus “knew that if they

By 2011, Thoratec became aware of problems with rising

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thrombosis rates in patients receiving the HeartMate II.

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e.g., SAC ¶¶ 8, 88, 92, 142, 145, 165.

See,

Despite this, Defendants

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Specifically, Burbach was Thoratec’s President and Chief
Executive Officer during the Class Period, Harris was the Vice
President and Chief Financial Officer beginning in October 11,
2012, and Smith was the Executive Vice President and Chief
Financial Officer between December 2006 and July 2011. SAC ¶¶ 30–
32.
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made various false and misleading statements regarding the

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HeartMate II’s thrombosis rates.

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Smith spoke at a health care conference and stated that HeartMate

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II’s rates of thrombosis were between 0.02 and 0.03, the clinical

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trial rates, despite knowledge at that time that they had risen

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well above that level.

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continued to make similar statements throughout the Class Period.

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On May 11, 2011, for example,

Id. ¶¶ 90–92.

The individual Defendants

On November 27, 2013, external studies and articles
published, including a study by the New England Journal of

United States District Court
For the Northern District of California

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Medicine (NEJM), concluded that the occurrence of thrombosis

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associated with the HeartMate II had significantly increased,

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causing Thoratec stock to drop by approximately six percent.

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¶¶ 128–29.

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confirming such reports and the related financial risk, and did

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not correct its prior disclosures.

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disclose the extent of the impact that the reported increases had

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on HeartMate II’s commercial viability until August 6, 2014,

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causing its stock to drop some twenty-five percent.

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68.

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Id.

Thoratec hid from its investors its own internal data

Id. ¶ 129.

Thoratec did not

Id. ¶¶ 166–

Plaintiffs Cooper and Labak are investors in Thoratec stock

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who purchased shares on July 15, 2013 and August 2, 2013,

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respectively.

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(Dkt. No. 12-2); SAC ¶ 27.

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following class:
all persons or entities that purchased or otherwise acquired
the common stock of Thoratec Corporation between May 11, 2011
and August 6, 2014, both dates inclusive. Excluded from the
Class are any parties who are or have been Defendants in this
litigation, the present and former officers and directors of
Thoratec and any subsidiary thereof, members of their
immediate families and their legal representatives, heirs,

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See Goldberg Decl. Ex. B (Movant Certification)
They move for certification of the

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successors or assigns and any entity in which any current or
former Defendant has or had a controlling interest.
Mot. at ii.

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LEGAL STANDARD
Plaintiffs seeking to represent a class first must satisfy

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the threshold requirements of Rule 23(a).

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that a case is appropriate for certification as a class action if:

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United States District Court
For the Northern District of California

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Rule 23(a) provides

(1) the class is so numerous that joinder of all members
is impracticable;
(2) there are questions of law or fact common to the
class;
(3) the claims or defenses of the representative parties
are typical of the claims or defenses of the class; and
(4) the representative parties will fairly and
adequately protect the interests of the class.

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Fed. R. Civ. P. 23(a).
Plaintiffs must also meet the requirements of one of the
subsections of Rule 23(b).

In this motion, Plaintiffs seek

certification pursuant to Rule 23(b)(3), which permits
certification where common questions of law and fact “predominate
over any questions affecting only individual members” and class
resolution is “superior to other available methods for the fair
and efficient adjudication of the controversy.”
23(b)(3).

Fed. R. Civ. P.

These requirements are intended “to cover cases ‘in

which a class action would achieve economies of time, effort, and
expense . . . without sacrificing procedural fairness or bringing
about other undesirable results.”

Amchem Prods. v. Windsor, 521

U.S. 591, 615 (1997) (quoting Fed. R. Civ. P. 23(b)(3) adv. comm.
notes to 1966 amendment).

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4

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Plaintiffs seeking class certification bear the burden of

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demonstrating that they satisfy each Rule 23 requirement at issue.

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Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 158–61 (1982);

4

Doninger v. Pac. Nw. Bell, Inc., 564 F.2d 1304, 1308 (9th Cir.

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1977).

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require it “to probe behind the pleadings before coming to rest on

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the certification question.”

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U.S. 338, 350–51 (2011) (internal quotation marks omitted).

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“Frequently that ‘rigorous analysis’ will entail some overlap with

The court must conduct a “rigorous analysis,” which may

Wal–Mart Stores, Inc. v. Dukes, 564

United States District Court
For the Northern District of California

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the merits of the plaintiff's underlying claim.

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helped.”

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extent––but only to the extent––that they are relevant to

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determining whether the Rule 23 prerequisites for class

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certification are satisfied.”

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Trust Funds, 568 U.S. 455, 466 (2013).

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committed to the district court’s discretion.

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Yamasaki, 442 U.S. 682, 703 (1979).

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I.

Id. at 2551.

That cannot be

“Merits questions may be considered to the

Amgen Inc. v. Conn. Ret. Plans &
This determination is
Califano v.

DISCUSSION
Plaintiffs Meet Rule 23(a)’s Requirements, Including Adequacy
Defendants do not dispute that Plaintiffs have satisfied Rule

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23(a)’s requirements of numerosity, commonality, and typicality,
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and instead focus only on adequacy.

They argue that Plaintiffs

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are not adequate class representatives because they purchased
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shares only prior to November 27, 2013, and thus have no incentive
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to pursue claims on behalf of post-November 27, 2013 investors.
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In order to establish adequacy under Rule 23(a)(4), named
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plaintiffs must show that they “will fairly and adequately protect
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the interests of the class.”

Fed. R. Civ. P. 23(a)(4).

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“To

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determine whether named plaintiffs will adequately represent a

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class, courts must resolve two questions:

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plaintiffs and their counsel have any conflicts of interest with

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other class members and (2) will the named plaintiffs and their

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counsel prosecute the action vigorously on behalf of the class?”

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Ellis v. Costco Wholesale Corp., 657 F.3d 970, 985 (9th Cir. 2011)

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(internal quotation marks omitted).

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(1) do the named

Defendants contend that investors who purchased stock after
the November 27, 2013 publications could not have relied on the

United States District Court
For the Northern District of California

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May 11, 2011 misrepresentation that thrombosis rates had not

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increased above the clinical trial rates of two to three percent.

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Because neither Labak nor Cooper purchased shares after November

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27, 2013, they have no incentive to pursue vigorously the

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divergent claims of “post-publication” investors.

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further below, Defendants continued to make misrepresentations

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about thrombosis rates after the November 27, 2013 publications

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and undermined the studies’ conclusions.

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who purchased both before and after may rely on the same theory of

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liability, there are no divergent claims, and Labak and Cooper are

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adequate class representatives.

As discussed

Because class members

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Because Labak and Cooper are adequate class representatives

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and Defendants do not dispute the other factors, Plaintiffs have

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met Rule 23(a)’s requirements.

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II.

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Plaintiffs Meet Rule 23(b)(3)’s Requirements, Including
Predominance
Defendants most vigorously argue that Plaintiffs cannot show

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predominance for two reasons.

First, they argue that Plaintiffs

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cannot rely on a presumption of reliance because they fail to show
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front-end price impact.

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not demonstrated that damages are measurable on a class-wide

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basis.

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Second, they argue that Plaintiffs have

Neither of Defendants’ arguments is successful.

A.

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Plaintiffs Sufficiently Allege Reliance Based on the
Fraud-on-the-Market Theory

In order to bring a claim under Section 10(b), “the plaintiff
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must show individual reliance on a material misstatement.”

Hanon

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v. Dataproducts Corp., 976 F.2d 497, 506 (9th Cir. 1992).

“The

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reliance element ‘ensures that there is a proper connection
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between a defendant’s misrepresentation and a plaintiff’s
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United States District Court
For the Northern District of California

injury.’”

Halliburton Co. v. Erica P. John Fund, Inc., 134 S. Ct.

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2398, 2407 (2014) (quoting Amgen Inc. v. Conn. Ret. Plans & Trust
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Funds, 568 U.S. 455, 488 (2013)).
13
In Basic Inc. v. Levinson, 485 U.S. 224 (1988), the Supreme
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Court created a rebuttable presumption of reliance based on the
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“fraud-on-the-market” theory, which holds that “the market price
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of shares traded on well-developed markets reflects all publicly
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available information, and, hence, any material
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misrepresentations.”

Id. at 246.

This presumption recognizes

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that “the typical investor who buys or sells stock at the price
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set by the market does so in reliance on the integrity of that
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price––the belief that it reflects all public, material
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information.”

Halliburton, 134 S. Ct. at 2408 (internal quotation

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marks omitted).

“As a result, whenever the investor buys or sells

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stock at the market price, his reliance on any public material
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misrepresentations . . . may be presumed for purposes of a Rule
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10b-5 action.”

Id. (internal quotation marks omitted).

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In order to establish the Basic presumption, a plaintiff must

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demonstrate:

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publicly known, (2) that they were material, (3) that the stock

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traded in an efficient market, and (4) that the plaintiff traded

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the stock between the time the misrepresentations were made and

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when the truth was revealed.”

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“Any showing that severs the link between the alleged

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misrepresentation and either the price received (or paid) by the

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plaintiff, or his decision to trade at a fair market price, will

“(1) that the alleged misrepresentations were

Halliburton, 134 S. Ct. at 2408.

United States District Court
For the Northern District of California

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be sufficient to rebut the presumption of reliance.”

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U.S. at 248.

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did not in fact affect the stock price” may be sufficient to rebut

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the presumption at the class certification stage.

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134 S. Ct. at 2414.

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price impact.

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Devices, Inc., No. 14-cv-00226 YGR, 2016 WL 1042502, at *7 (N.D.

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Cal. Mar. 16, 2016).

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1.

Basic, 485

For example, “evidence that the misrepresentation

Halliburton,

It is Defendants’ burden to show lack of

See id. at 2417; Hatamian v. Advanced Micro

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Defendants’ Argument of Lack of Price Impact With
Respect to the May 11, 2011 Alleged
Misrepresentation Fails

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Defendants argue that there was a lack of price impact, and

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thus Plaintiffs may not rely on the Basic presumption.

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to show price impact, Plaintiffs submit the expert report of Dr.

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Zachary Nye, who studied Thoratec common stock “to determine

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whether new material corporate events or financial releases

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promptly caused a measurable stock price reaction after accounting

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for contemporaneous market and industry effects.”

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Decl. Ex. 1 (Nye Report) (Dkt. No. 99-1) at ¶¶ 51–55.

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analysis concludes “(i) that a strong cause-and-effect
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In order

See Ludwig
His

1

relationship existed between the information disclosed on the

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events dates and resulting stock price movements; and (ii) that

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the direction of the Company-specific return on event dates is

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consistent with the information disclosed.”

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Id. ¶ 54.

Defendants contend in opposition that Dr. Nye’s analysis

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actually demonstrates that there was no statistically significant

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increase in Thoratec’s stock price on May 11, 2011, the date that

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Smith made the first allegedly false and misleading statement.

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See Nye Report Ex. 11A at 1.

Dr. Nye admitted as much at his

United States District Court
For the Northern District of California

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deposition, and Defendants’ expert, Dr. Allen Ferrell, conducted

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an analysis confirming the same.

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Dep. Tr.) (Dkt. No. 107-2) at 104:8–17; Rawlinson Decl. Ex. 1

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(Farrell Report) (Dkt. No. 107-1) at ¶ 26.

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this constitutes direct evidence that the alleged

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misrepresentation did not actually affect the stock’s market

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price, and that Plaintiffs had not contended and cannot contend

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for the first time on reply that they are instead alleging a price

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maintenance theory.

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See Rawlinson Decl. Ex. 2 (Nye

Defendants argue that

Defendants’ argument that Plaintiffs fail to allege a price

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maintenance theory is not well-taken.

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shows that Plaintiffs allege that Thoratec’s claimed

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misrepresentations led investors to believe that the HeartMate II

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was reporting thrombosis rates consistent with the clinical

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trials--e.g., that the product was maintaining the status quo.

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Had Thoratec admitted that thrombosis rates were actually higher,

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HeartMate II would not have been able to maintain its competitive

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position in relation to HeartWare, and Thoratec’s stock price

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would not have remained afloat.

A fair reading of the SAC

Thus, that Smith’s May 11, 2011
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1

statement did not lead to any significant increase in stock price

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is entirely consistent with Plaintiffs’ theory that this

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misrepresentation prolonged the artificial inflation of Thoratec’s

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stock price.

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223, 259 (2d Cir. 2016) (“[W]e agree with the Seventh and Eleventh

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Circuits that securities-fraud defendants cannot avoid liability

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for an alleged misstatement merely because the misstatement is not

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associated with an uptick in inflation.”); FindWhat Investor Grp.

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v. FindWhat.com, 658 F.3d 1282, 1310 (11th Cir. 2011) (“A

See, e.g., In re Vivendi, S.A. Sec. Litig., 838 F.3d

United States District Court
For the Northern District of California

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corollary of the efficient market hypothesis is that disclosure of

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confirmatory information—-or information already known by the

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market-—will not cause a change in the stock price.”); Schleicher

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v. Wendt, 618 F.3d 679, 683 (7th Cir. 2010) (“[W]hen an unduly

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optimistic statement stops a price from declining (by adding some

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good news to the mix):

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to where it would have been had the statement not been made.”);

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see also Ludwig Decl. Ex. 1 (Farrell Dep. Tr.) (Dkt. No. 113-1) at

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52:3–6 (“Q. Would one necessarily expect the price of the security

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to increase when a material false statement is reiterated to the

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market?

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inflation exist during a class period when alleged

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misrepresentations do not coincide with significant price

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increases?

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of lack of price impact is irrelevant to Plaintiffs’ theory, which

once the truth comes out, the price drops

A. No.”), 53:13–20 (“Q. So, generally speaking, can price

A. It’s possible.”).

2

Defendants’ proffered evidence

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2

Because the plaintiff in In re Finisar Corp. Sec. Litig.,
No. 5:11-cv-01252-EJD, 2017 WL 6026244, at *8 (N.D. Cal. Dec. 5,
2017), was “not proceeding on a price maintenance theory,” that
case is inapposite.
10

1

is that the May 11, 2011 event would not have impacted Thoratec’s

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stock price by raising it, but rather prolonged its inflation.

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Defendants’ argument that Plaintiffs do not show that the May

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11, 2011 statement “maintained” the price at a level already

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inflated from some earlier misstatement has also been considered

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and rejected by various courts.

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259 (“[T]heories of ‘inflation maintenance’ and ‘inflation

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introduction’ are not separate legal categories.”) (internal

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quotation marks and citation omitted); Glickenhaus & Co. v.

See, e.g., Vivendi, 838 F.3d at

United States District Court
For the Northern District of California

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Household Int’l, Inc., 787 F.3d 408, 418 (7th Cir. 2015) (same).

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This Court finds the reasoning in those cases persuasive and

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agrees that Plaintiffs here not need not allege separate theories

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of inflation introduction and inflation maintenance.

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2.

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Defendants Do Not Show Lack of Price Impact With
Respect to Corrective Disclosures

Defendants next argue that the alleged corrective disclosures
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also fail to show price impact (1) because of the September 6,
17
2013 disclosure to the market and (2) because they were not
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“corrective” of the May 11, 2011 misrepresentation.

Defendants do

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not dispute that on the dates of each of the corrective
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disclosures alleged in the SAC, Thoratec’s stock price saw
21
statistically significant declines, -6.81 percent on November 27,
22
2013, and -29.65 percent on August 6, 2014, according to their own
23
expert.

See Farrell Report at ¶¶ 34, 38; accord Nye Report Ex.

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11A at 18, 23.
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On September 6, 2013, the Interagency Registry for
26
Mechanically Assisted Circulatory Support (INTERMACS) published
27
its Initial Analyses indicating that since 2011, the thrombosis
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1

rate associated with the HeartMate II had increased beyond the

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pre-approval clinical trial rate of two to three percent.

3

Farrell Report Ex. C.

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price of Thoratec stock.

5

Defendants, however, is a one-page web document that lists no

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authors and is not a published study.

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that it was merely web-published for physicians.

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also states, “Note the significant increase in events after May,

9

2011, but the magnitude of increase was relatively small.”

United States District Court
For the Northern District of California

10

See

There was no accompanying decline in the
This Initial Analyses as submitted by

Indeed, Plaintiffs contend
The document

Id.

The Court agrees with Plaintiffs that this document is

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insufficient to establish that the market already knew of the

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increased thrombosis rates associated with the HeartMate II prior

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to the November 27, 2013 corrective disclosure.

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initial analysis by INTERMACS, not a peer-reviewed, published

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study, undermining its authority on the topic.

16

document itself notes that while its numbers show a “significant

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increase,” the absolute “magnitude” of that increase was

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“relatively small,” dampening the overall impact of the analysis.

19

Farrell Report Ex. C.

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document had some viewership, it would not result in a meaningful

21

impact on the stock price because of its lack of authority and

22

cabined suggestion of increased rates of thrombosis.

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INTERMACS analysis is insufficient to sever the link between the

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May 11, 2011 misrepresentation and the corrective disclosures.

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It is merely an

Moreover, the

It is not surprising that, even if this

The

Defendants’ second theory is that neither the November 27,

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2013 publications nor the August 6, 2014 announcement was

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“corrective” of the May 11, 2011 alleged misrepresentation because

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they did not disclose new information previously unknown to the
12

1

market, nor did the information disclosed in the August 6, 2014

2

announcement match the specific alleged misrepresentation on May

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11, 2011.

4

With respect to Defendants’ argument that the November 27,

5

2013 publication did not disclose any new information, this

6

argument fails for the same reasons that the September 6, 2013

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“disclosure” argument fails.

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reports that suggest that increase in thrombosis rates was not

9

unknown to the market prior to the November 27, 2013 publications,

While Defendants point to analyst

United States District Court
For the Northern District of California

10

Defendants do not dispute that there were no peer-reviewed,

11

published studies that confirmed these increases with scientific

12

authority.

13

evidence linking the HeartMate II to higher thrombosis rates, and

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the market responded accordingly.

15

The November publications for the first time offered

Plaintiffs also present a plausible theory, and sufficient

16

evidence, that the August 6, 2014 announcement disclosed new

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information, even when considering the November 27, 2013

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disclosures.

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individual Defendants making misrepresentations about the

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thrombosis rates of increase, undermining the November 27, 2013

21

publications, misstating they had new clinical data exhibiting

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lower rates of increase when they did not, and omitting the impact

23

of the increased rates on revenues.

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143, 146, 149, 151, 154, 156, 159, 162.

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have reasonably misled investors to doubt the November 27, 2013

26

publications and instead believe that Thoratec’s rates of

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thrombosis were stable and no longer increasing, or even lower

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than suggested by the earlier publications.

Plaintiffs’ SAC is rife with examples of the

13

See, e.g., SAC ¶¶ 138, 140,
These statements could

1

Defendants’ argument that the information disclosed in the

2

August 6, 2014 announcement did not “match” the specific alleged

3

misrepresentation on May 11, 2011, on the other hand, deserves

4

more scrutiny.

5

statement, Defendants disclosed missed earnings and revenues due

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to concern over high thrombosis rates, lowered 2014 guidance, and

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disclosed a label change.

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statement on that date explaining that the November 27, 2013

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publications “along with greater scrutiny of clinical outcomes

Plaintiffs allege that in the August 6, 2014

SAC ¶¶ 166–67.

Burbach issued a

United States District Court
For the Northern District of California

10

overall continues to be the largest factor impacting our business

11

on a worldwide basis” and growth in overall referrals was down.

12

Id. at 166.

13

be a headwind during the first half of the year is [sic] now

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clearly the impact is persisting longer than expected.

Burbach explained, “While we expect that this would

Id.

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Defendants contend that these statements do not “match”

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earlier alleged misrepresentations because they do not reveal any

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fact known to Thoratec at the time of the May 11, 2011 statement,

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nor the earlier statements regarding 2014 guidance.

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these statements dealt only with the impact of the November 27,

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2013 publications on the second half of 2014.

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announced “label change” correct any earlier misstatement.

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Instead,

Nor did the

While this is Defendants’ strongest argument, Defendants’

23

statements in the period between November 27, 2013 and August 6,

24

2014 can reasonably be read to suggest that the impact of the

25

November 2013 publications on implanting physicians (and therefore

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Thoratec’s bottom line) would be minimal.

27

2014 disclosure that the publications had in fact substantially

28

impacted earnings and revenues corrected the earlier misleading
14

Thus, Thoratec’s August

1

statements, causing Thoratec’s stock immediately to drop a

2

significant amount.

3

since May 11, 2011 was to hide the effect of the increased

4

thrombosis rates on the company’s financials, which did not come

5

to light until August 6, 2014.

6

a sufficient link between the May 11, 2011 misrepresentations and

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the August 6, 2014 statement, Plaintiffs may proceed on their

8

theory at this early stage.

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the misrepresentations made in 2013 and the August 2014 disclosure

United States District Court
For the Northern District of California

10
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Plaintiffs also argue that Thoratec’s purpose

While the Court is concerned about

In the future, a subclass based on

may be appropriate.
Because the Court concludes that Defendants continued to make

12

material misrepresentations after the November 27, 2013

13

publications, and Plaintiffs may proceed on their August 24, 2014

14

corrective disclosure theory as well, Defendants’ alternative

15

requests to end the Class Period on November 27, 2013 or to create

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subclasses are denied at this time without prejudice.

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B.

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As part of the predominance inquiry, Plaintiffs must

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demonstrate that “damages are capable of measurement on a

20

classwide basis.”

21

(2013).

22

necessary “to show that [the] method will work with certainty at

23

this time,”

24

2016 WL 1213767, at *3 (N.D. Cal. Mar. 29, 2016).

25

the Ninth Circuit has stated that “the presence of individualized

26

damages cannot, by itself, defeat class certification under Rule

27

23(b)(3).”

28

Cir. 2013).

Damages

Comcast Corp. v. Behrend, 569 U.S. 27, 34

“Calculations need not be exact,” id. at 35, nor is it

Khasin v. R.C. Bigelow, Inc., No. 12-cv-02204-WHO,
Furthermore,

Leyva v. Medline Indus. Inc., 716 F.3d 510, 514 (9th

15

1

Plaintiffs argue that damages can be calculated through an

2

event study like that provided by their expert, Dr. Nye, which

3

quantifies Thoratec’s per share price decline upon disclosure of

4

the fraud.

5

method for the evaluation of materiality damages to a class of

6

stockholders in a defendant corporation.”

7

Inc. Sec. Litig., 295 F.R.D. 240, 251 (N.D. Cal. 2013) (citing In

8

re Imperial Credit Indus., Inc. Sec. Litig., 252 F. Supp. 2d 1005,

9

1014 (C.D. Cal. 2003)).

Indeed, “[t]he event study method is an accepted

In re Diamond Foods,

United States District Court
For the Northern District of California

10

Defendants argue that this methodology is insufficient

11

because it fails to take into consideration what Defendants

12

characterize as competing sets of misrepresentations.

13

same reasons that the Court rejected Defendants’ arguments

14

regarding the November 27, 2013 publication date, this argument

15

too fails.

16

shown, at this stage, that damages are capable of measurement on a

17

classwide basis.

18
19

The Court concludes that Plaintiffs have sufficiently

For these reasons, Plaintiffs have satisfied Rule 23(b)(3)’s
requirements.

20
21

For the

CONCLUSION
Because Plaintiffs have satisfied the requirements of Rules

22

23(a) and 23(b)(3), Plaintiffs’ Motion for Class Certification is

23

granted.

24
25
26

IT IS SO ORDERED.
Dated: May 8, 2018
CLAUDIA WILKEN
United States District Judge

27
28
16