On October 3, 2001, the Court entered the Mandate of the Second Circuit Court of Appeals affirming the Judgment of the District Court.
According to a Court Decision by U.S. District Judge Shira A. Scheindlin dated January 3, 2000, plaintiffs brought an uncertified securities fraud class action against defendants. Defendants moved to dismiss the complaint, pursuant to Federal Rule of Civil Procedure 9(b) and the Private Securities Litigation Reform Act, for failure to plead fraud with particularity. The court noted that all securities fraud actions were subject to Rule 9(b) and that the Reform Act heightened Rule 9(b)s requirement for pleading scienter. Under the Reform Act, plaintiffs must "state with particularity facts giving rise to strong inference that the defendant acted with the required state of mind," by showing motive or opportunity to commit fraud. The court found that plaintiffs failed to meet this heightened requirement because plaintiffs argued that defendants were motivated by a desire to suppress criticism and this desire was insufficient to allege scienter. Defendants' motion to dismiss is granted with leave to amend.
The complaint alleges defendants MediaOne Group, Inc. and certain of its directors violated Section 10(b) of the Securities and Exchange Act of 1934, 15 U.S.C. @ 78j(b), and Rule 10b-5 promulgated thereunder, 17 C.F.R. @ 240.10b-5, by fraudulently failing to disclose certain information in connection with a publicly announced, proposed merger between MediaOne and Comcast Corporation. Plaintiff brings an additional claim against the individual defendants for controlling person liability pursuant to Section 20 of the Exchange Act.