So the question for Judge Nanette K. Laughrey (E.D. Mo. + W.D. Mo. and D.D.C.) (sorry for the court confusion here, but if anyone knows why or how Judge Laughrey was appointed to sit in both Missouri Districts, yet is not listed at all on the E.D. Mo site, and is issuing an opinion in a DC case, the rest of us are dying to know, so please tell us by leaving a comment below) in the Iridium securities class action was “whether the inability of aftermarket purchasers to recover under Section 12 defeats certification of a sub-class which pursues both Section 11 and 12 claims.”
What did the Judge do? She reasoned that “any difficulty by individual class members in tracing their particular aftermarket-purchased shares to the Registration Statement is a secondary issue to be resolved after the predominant issue of Defendant Underwriters' liability has been decided. It would be inappropriate to foreclose such Plaintiffs' resort to the class action format simply because some of their cases may be difficult to prove.”
Result? Class Certified.
You can read Freeland v. Iridium World Communications, issued January 9, 2006, at 2006 U.S. Dist. LEXIS 744.
Nugget: “Even if the common issues didn't predominate, Plaintiffs could easily seek to certify two subclasses, one with Section 11 claims and one with Section 12 claims. Forcing the Plaintiffs to do so unnecessarily, however, would add yet another delay to what is already a long-lived case, especially since it would be much more efficient to consider these differences at the damages stage, if and when it is reached. This makes more sense than having repeated trials to decide the common questions of fact. Separate trials might also produce inconsistent findings.”