Robbins Geller Achieves Appellate Victory for Investors in the Ninth Circuit

Robbins Geller Rudman & Dowd LLP achieved an important victory for investors in a securities fraud case against Funko. The lead plaintiffs allege that Funko and certain current and former top executives made false and/or misleading statements to investors regarding implementation of its new enterprise resource planning software system, its move to a new warehouse before the implementation was complete, and accumulation of excess inventory.

In a published decision issued February 4, 2026, the U.S. Court of Appeals for the Ninth Circuit reversed in part the district court’s decision dismissing the case.

“In a detailed, 52-page opinion, the Ninth Circuit reaffirmed the importance of full and fair disclosure to investors. Notably, it held that, as in this case, warnings to investors of so-called ‘future risks’ that imply the risks had not yet occurred are not shielded from liability when those risks ‘ceased to be merely hypothetical.’ Moreover, the Court reiterated that it is ‘absurd’ for executives to claim they were unaware of these issues when such issues were of critical importance to the company,” partner Andrew S. Love, who argued the appeal before the Ninth Circuit, told Bloomberg Law. “We look forward to returning to the district court and litigating this case on behalf of our clients.”

The Funko decision comes shortly after other significant appellate victories with implications for investors pursuing accountability through securities litigation. In a closely watched appeal involving BDO USA, a major auditor, the Second Circuit granted a rare petition for rehearing and upheld investors’ previously dismissed claims against BDO in a securities fraud case against BDO and AmTrust Financial Services. (In the initial appeal in the Second Circuit, Robbins Geller succeeded in obtaining a reversal of the district court’s dismissal of the Securities Act claims against AmTrust, but the court had affirmed dismissal of Exchange Act claims against BDO.) Last year, the U.S. Supreme Court declined to review the rehearing decision, allowing the claims against both BDO and AmTrust to proceed. 

In the Abengoa decision, the Second Circuit held that allegations from confidential witnesses, reports, and findings from other proceedings (there, a Spanish criminal case) may support inferences of fraudulent intent and false or misleading statements. The Firm also obtained two significant victories in the Third Circuit in Maiden (reversing the district court’s ruling granting summary judgment in favor of defendants) and Johnson & Johnson (affirming the district court’s grant of class certification).

Robbins Geller attorneys Andrew S. Love, Hillary B. Stakem, Ting H. Liu, and Jessica E. Robertson represented plaintiffs in the Funko appeal.

The opinion from the Ninth Circuit is available here: https://cdn.ca9.uscourts.gov/datastore/opinions/2026/02/04/24-4909.pdf.

Construction Laborers Pension Trust of Greater St. Louis v. Funko Inc, 166 F.4th 805 (9th Cir. 2026).