Amgen v. Connecticut Retirement Plans (11-1085)

In 2004, biotechnology company Amgen Inc. was selling securities of two drugs that stimulate the production of red blood cells. After the Food and Drug Administration held an advisory committee meeting in May 2004 about the safety of those drugs, the market prices of their corresponding securities dropped. On behalf of the shareowners who suffered, Connecticut Retirement Plans and Trust Funds sought to certify the class of investors who held stock in Amgen at that time to sue Amgen for fraud regarding any misrepresentations of the drugs. Amgen argues that this kind of class action requires a plaintiff to show material reliance of the class of investors as part of the question as to whether a class exists. In contrast, Connecticut Retirement argues that during this class certification stage a plaintiff need not go beyond demonstrating that investors share a common question of reliance as a class rather than as individuals. If Amgen wins, then plaintiffs of securities fraud may face an unwieldy burden of proof at an early stage in litigation. If Connecticut Retirement wins, then defendants of securities fraud may face unfair pressures to settle cases.

Questions as Framed for the Court by the Parties: 

1. Whether, in a misrepresentation case under SEC Rule 10b-5, the district court must require proof of materiality before certifying a plaintiff class based on the fraud-on-the-market theory.

2. Whether, in such a case, the district court must allow the defendant to present evidence rebutting the applicability of the fraud-on-the-market theory before certifying a plaintiff class based on that theory.


1. To establish a class of investors in a lawsuit alleging securities fraud, must a plaintiff show that the defendant’s allegedly untrue statements materially affected the security’s price?

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