Teamsters Local 617 Pension & Welfare Funds v. Apollo Group, Inc.
2012 U.S. Dist. LEXIS 45794
D. Ariz.2012Background
- This is a securities fraud action where Pension Trust Fund for Operating Engineers sued Apollo Group, Inc. and related executives.
- Plaintiff alleged numerous false statements and restatements under PSLRA and Rule 9(b); multiple complaints were filed and scrutinized.
- The court previously dismissed the SAC with prejudice for lack of pleading falsity and particularity, denying leave to amend.
- Lead Plaintiff moved under Fed. R. Civ. P. 59(e) to alter or amend the judgment, arguing intervening law and other errors.
- Defendants contended the Rule 59(e) motion was untimely or improper under local rule and that no intervening change in law warranted relief.
- The court analyzed timeliness, standards for Rule 59(e) relief, and whether Finisar III and Ernst constituted an intervening change in controlling law warranting reopening of Apollo III.]
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Rule 59(e) motion was timely and properly framed. | Plaintiff contends Rule 59(e) governs and timely filing, despite local rule references. | Defendants argue timeliness hinges on LRCiv 7.2(g)(2) rather than Rule 59(e). | Timely under Rule 59(e); LRCiv 7.2(g)(2) does not govern here. |
| Whether Finisar III or Ernst constitutes an intervening change in controlling law warranting relief under Rule 59(e). | Finisar III and Ernst changed controlling law affecting Apollo III. | They do not constitute a controlling change in law; they largely reaffirm or apply existing principles. | Neither Finisar III nor Ernst amount to a controlling change in law. |
| Whether the movant demonstrated manifest or clear error to reopen the judgment. | Movant asserts manifest error in dismissing statements and in denying amendment. | Defendants argue no clear error; the court’s previous reasoning was sound. | No manifest or clear error justifying relief. |
| Whether denial of leave to amend was clearly erroneous under Eminence Capital and Foman factors. | Plaintiff contends Eminence Capital and Foman factors require amendment rather than final dismissal. | Court properly denied leave to amend given prior opportunities and lack of new facts. | No clear error; the denial of leave to amend was appropriate. |
| Whether the request to file a further amended complaint should be entertained via Rule 59(e) relief. | DTAC would cure pleading deficiencies and justify amendment. | Plaintiff failed to present a proposed amended complaint and advanced this belatedly. | Rule 59(e) relief denied; no right to a further amendment. |
Key Cases Cited
- Ernst & Young LLP v. Broadcom Corp., 641 F.3d 1089 (9th Cir. 2011) (scienter allegations against auditor; implicated change in law not shown)
- In re Finisar Corp. Derivative Litig., 429 F. App’x 641 (9th Cir. 2011) (unpublished; discussed as potential intervening authority; not controlling change)
- Schiller v. Physicians Resource Group, Inc., 342 F.3d 563 (5th Cir. 2003) (change in controlling law concept under Rule 59(e) guidance)
- Abatie v. Alta Health & Life Insurance Co., 458 F.3d 955 (9th Cir. 2006) (en banc ERISA; change in analysis for abuse of discretion standard)
- Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308 (U.S. 2007) (requires weighing in pleading scienter; governs falsity and causation standards)
- Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981 (9th Cir. 2009) (discretionary denial of leave to amend after prior amendment)