Robbins Geller Obtains Class Certification in Goldman Sachs Securities Class Action, the Firm’s Seventh Post-Halliburton Class Certification Victory
On September 24, 2015, the Honorable Paul A. Crotty of the Southern District of New York certified a class in In re Goldman Sachs Grp., Inc. Sec. Litig., No. 10 Civ. 3461 (PAC) (S.D.N.Y.), comprised of all persons or entities who, between February 5, 2007 and June 10, 2010, purchased or otherwise acquired the common stock of The Goldman Sachs Group, Inc. and were damaged thereby. The case alleges that Goldman Sachs and several senior executive officers made materially false and misleading statements about its business practices and conflicts of interests in certain CDO transactions including the Abacus CDO, which the SEC brought and settled fraud charges for $550 million. Goldman Sachs’ misstatements and omissions materially misled Goldman Sachs’ shareholders and artificially inflated Goldman Sachs’ stock price.
With respect to the predominance inquiry under Rule 23(b)(3), the court considered and rejected defendants’ attempt to prove lack of price impact – which would have eliminated the presumption of reliance – pursuant to the Supreme Court’s decision in Erica P. John Fund, Inc. v. Halliburton Co., 563 U.S. 804, 131 S. Ct. 2179, 2185 (2011) (“Halliburton II”). In doing so, the court determined that plaintiffs’ expert, Dr. Finnerty, sufficiently established the market efficiency for Goldman Sachs stock. In addition, Judge Crotty determined that “Defendants have failed to demonstrate a complete lack of price impact,” and “cannot show that the total decline in the stock price on the corrective disclosure dates is attributable simply to the market reaction to [non-culpable reasons].” In sum, the court held that “where Defendants cannot demonstrate a complete absence of price impact, and where Plaintiffs have demonstrated an efficient market, the Basic presumption applies, and Plaintiffs have demonstrated classwide reliance and predominance.”
In addition, the court rejected defendants’ assertion that the Supreme Court’s decision in Comcast Corp. v. Behrend, _U.S._, 133 S. Ct. 1426 (2013), precluded certification, finding that plaintiffs’ damages model properly measures damages that result from the class’ asserted theory of injury.
The Goldman Sachs class certification order is the seventh post-Halliburton II class certification victory Robbins Geller has obtained in a securities case – more than any other plaintiffs’ firm. Robbins Geller’s earlier class certification victories include Questcor, Regions, Bridgepoint Education, Barclays, Best Buy and Prudential.
In re Goldman Sachs Grp., Inc. Sec. Litig., No. 10 Civ. 3461 (PAC) (S.D.N.Y. Sept. 24, 2015).