Looks like the Ninth Circuit isn’t going to let Judge Napoleon A. Jones’ (S.D. Cal.) dismissal of the third amended complaint in the JNI securities class action stand -- at least not without more explanation. You see, although the Panel said that they “agree with the district court's careful and well-reasoned decision,” Judge Jones, who “issued detailed orders dismissing Plaintiffs' first and second amended complaints with leave to amend,” “then dismissed Plaintiffs' third amended complaint without leave to amend.” However, he “did not discuss any of the Foman factors,” “stating only the following with respect to whether Plaintiffs should be granted leave to amend: ‘In its previous Order, the court cautioned Plaintiffs that they would receive no further opportunities to amend their pleadings. Accordingly, the TACC is DISMISSED WITH PREJUDICE.’”
But, the Panel recognized, “Plaintiffs represent that they could amend their pleading to address at least some of the deficiencies noted by the district court, so “on remand, the district court may permit Plaintiffs once again to amend their complaint or it may state with particularity its reasons for declining to do so.”
Click here to read Hey Mack, an early Nugget article (boy, was the Nugget overly-energetic back then) on another Judge Jones decision -- for Plaintiffs.
You can read Osher v. JNI (which is unpublished), issued May 12, 2006, at 2006 U.S. App. LEXIS 12186.
Nugget: “Leave to amend is to be granted with extreme liberality in securities fraud cases, because the heightened pleading requirements imposed by the PSLRA are so difficult to meet.”