A proposed class claimed that it was incorrectly denied IPO allocations by Wit Capital Group.
Retained by Morgan, Lewis & Bockius
A proposed class claimed that it was incorrectly denied IPO allocations by Wit Capital Group. Defense counsel retained Dr. Allan Kleidon, a senior vice president of Cornerstone Research, to provide an economic analysis of the putative class for class certification purposes.
The court denied class certification.
Research by Dr. Kleidon showed that there was no evidence that all putative class members had suffered an economic loss from the defendant’s allegedly improper failure to allocate IPO shares to plaintiffs. Whether an individual defendant would have gained or lost on a hypothetical stock investment would depend on when he or she sold the shares, which cannot be determined in the absence of individualized inquiry (if at all).
The court denied class certification because the plaintiffs failed to show that all putative class members suffered an injury in fact. As the court noted, “In some cases, plaintiffs lost the opportunity to lose money. Those plaintiffs were not injured in fact.”