A federal judge denied class certification for one claim in bodog online casino securities class action litigation.
Retained by King & Spalding
In bodog online casino securities class action litigation, the plaintiff alleged that AAC Holdings (1) engaged in misleading marketing behaviors and (2) improperly calculated its accounts receivables. Defense counsel for AAC Holdings and the individual defendants retained Paul Zurek of Cornerstone Research.
Dr. Zurek opined that the plaintiff’s expert did not propose a methodology that could measure inflation bodog online casino allegations concerning marketing behaviors due in part to the plaintiff’s materialization of risk theory of liability and the mismatch of the content of the alleged misrepresentation and the allegedly corrective information. Specifically, the plaintiff’s expert proposed an out-of-pocket damages methodology that assumed stock price reactions to the allegedly corrective information could be used to measure inflation. However, the alleged marketing misrepresentations regarded a “fraudulent and deceptive sales and marketing scheme,” while the allegedly corrective information was disappointing financial results (materialization of a risk), not that the company’s marketing behaviors were “fraudulent [or] deceptive.”
The U.S. district court for the Middle District of Tennessee judge denied class certification for the marketing behaviors claim in bodog online casino securities class action.
The U.S. district court for the Middle District of Tennessee judge denied class certification for the marketing behaviors claim in bodog online casino securities class action. He noted that plaintiff’s expert’s damages methodology “appears to be referencing corrective disclosures rather than risk” and that the proposed calculation of damages in plaintiff’s expert’s report “appears to omit any consideration of how to factor in the risk on which Plaintiff bases its materialization-of-the-risk theory.” The judge denied certification because “Plaintiff has failed to provide a damages model that comports with the materialization or risk theory of loss causation.” The case settled after the ruling.
San Francisco
