Inter-Marketing Group U S A Inc v. CenturyLink, Inc., 0:18-cv-00299

In June 2017 Bloomberg articles reported a former CenturyLink sales rep alleged pervasive fraudulent sales practices; CenturyLink stock and certain notes dropped on those disclosures.
Multiple federal securities class actions were filed alleging the same fraud across the same class period; four actions were transferred into MDL No. 2795 and consolidated in the Western District of Louisiana with Oregon appointed lead plaintiff.
Inter‑Marketing Group USA, Inc. (IMG) later filed a separate securities suit limited to holders of CenturyLink’s 7.60% Senior Notes, asserting the same claims and class period as the consolidated actions.
Oregon moved to consolidate IMG into the existing consolidated actions and to remain Lead Plaintiff; IMG sought appointment as Lead Plaintiff for noteholders and approval of lead counsel.
The Court considered (1) whether IMG’s noteholder claims should be consolidated with the broader securities cases, (2) whether noteholders require a separate lead plaintiff, and (3) whether IMG’s lead‑plaintiff motion was timely.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether IMG’s noteholder action should be consolidated with the existing consolidated securities actions	IMG argued its notes‑only suit is separate and sought separate lead status	Oregon argued the note claims arise from the same facts and were encompassed by the earlier consolidated "CenturyLink securities" class	Consolidation granted; IMG action consolidated into the existing MDL
Whether noteholders must have a separate lead plaintiff from stockholders	IMG sought separate bond lead plaintiff to represent noteholders	Oregon argued PSLRA favors a single lead, and Oregon identified a named plaintiff with standing as a noteholder	Court denied separate lead plaintiff; single lead (Oregon) retained
Whether inclusion of notes in the consolidated class is appropriate	IMG contended notes may differ and warrant separate representation	Oregon and defendants argued PSLRA and precedent treat notes as securities and allow single lead for mixed securities classes	Court held notes fall within PSLRA definition of "security" and may be represented in the consolidated action
Timeliness of IMG’s lead plaintiff motion	IMG filed for lead plaintiff status after publishing its own notice and argued it could move	Oregon argued the PSLRA 60‑day window ran from the first published notice (Thummeti) and IMG’s motion was untimely	IMG’s motion denied as time‑barred (deadline was August 21, 2017); IMG’s motion therefore moot after consolidation

E.E.O.C. v. HBE Corp., 135 F.3d 543 (8th Cir. 1998) (standard for consolidation under Rule 42 and abuse of discretion review)
Great Rivers Co-op. of Se. Iowa v. Farmland Indus., Inc., 198 F.3d 685 (8th Cir. 1999) (PSLRA definition of "security" is broad enough to include notes)
Reves v. Ernst & Young, 494 U.S. 56 (1990) (notes are presumptively securities under securities law)
In re Global Crossing, Ltd. Sec. Litig., 313 F. Supp. 2d 189 (S.D.N.Y. 2003) (consolidation and single lead plaintiff appropriate where common facts and claims span different security types)
Aronson v. McKesson HBOC, Inc., 79 F. Supp. 2d 1146 (N.D. Cal. 1999) (stock purchasers may represent purchasers of debt instruments in consolidated securities litigation)
Hevesi v. Citigroup Inc., 366 F.3d 70 (2d Cir. 2004) (PSLRA centralizes decision‑making in one lead plaintiff to avoid fragmentation)
In re Enron Corp. Sec. Litig., 206 F.R.D. 427 (S.D. Tex. 2002) (appointing separate lead plaintiffs for different security classes can undermine cohesive leadership)
In re Nw. Corp. Sec. Litig., 299 F. Supp. 2d 997 (D.S.D. 2003) (no requirement that lead plaintiff have standing for every claim in consolidated action)
In re Telxon Corp. Sec. Litig., 67 F. Supp. 2d 803 (N.D. Ohio 1999) (PSLRA’s 60‑day deadline for lead plaintiff motions is strict)