After getting smacked down by Judge James C. Mahan (D. Nev.) in the Saxton securities class action, Plaintiffs cried foul to the Ninth Circuit because Judge Mahan refused to let them try to cure their first amended complaint. The Ninth Circuit is now shipping the action back to Judge Mahan, reminding everyone that “leave to amend shall be freely given when justice so requires,” and that “adherence to liberal grants of leave to amend is especially important in the context of the PSLRA.” Indeed, “because the district court dismissed the Complaint based solely on Plaintiffs' failure to plead scienter, and did not provide any reasoned explanation as to why leave to amend would be futile with respect to the individual Saxton officers, we conclude that the court abused its discretion. Therefore, we determine that the district court should not have dismissed the Complaint, as to the individual Saxton officers, with prejudice.”
You can read In re Saxton, issued December 2, 2005, here or at 2005 U.S. App. LEXIS 26574.
Nugget: “This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3.”