Amgen Inc. v. Connecticut Retirement Plans and Trust Funds

Summary

The Supreme Court held that proof of materiality is not a prerequisite to certifying a securities-fraud class action under Federal Rule of Civil Procedure 23(b)(3). Because materiality is an objective question subject to classwide proof, and failure to establish it would end the case for all class members rather than create individualized issues, it need not be established at the certification stage. The Court also held that rebuttal evidence directed solely at materiality did not need to be considered at that stage.

Holdings

1. Proof of materiality is not a prerequisite to certification of a securities-fraud class action seeking damages under § 10(b) and Rule 10b-5.
2. The district court did not err by declining to consider Amgen's rebuttal evidence, which was offered to show that the alleged misrepresentations and omissions were immaterial.
3. Rule 23 does not authorize free-ranging merits inquiries at the certification stage; merits questions may be considered only to the extent they are relevant to determining whether the Rule 23 prerequisites are satisfied.

Questions Presented

1. Whether a plaintiff seeking certification of a securities-fraud class action under Rule 23(b)(3) must prove the materiality of the alleged misrepresentations and omissions before certification.
2. Whether a district court must consider a defendant's rebuttal evidence concerning the alleged immateriality of the misrepresentations and omissions at the class-certification stage.
3. Whether Rule 23 permits a court to adjudicate the merits of an essential securities-fraud element at class certification when that element is relevant to, but not dispositive of, the predominance inquiry.

Disposition

affirmed