Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_01-cv-02661/USCOURTS-cand-3_01-cv-02661-5/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:78m(a) Securities Exchange Act

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

In re EXODUS COMMUNICATIONS, INC.

SECURITIES LITIGATION

This Document Relates to: ALL ACTIONS

 /

Master File No. C-01-2661 MMC

ORDER DENYING UNDERWRITER

DEFENDANTS’ MOTION FOR LEAVE 

TO FILE MOTION FOR

RECONSIDERATION, MOTION FOR

EXTENSION OF TIME TO ANSWER,

AND MOTION FOR STAY OF

DISCOVERY

(Docket No. 254)

Before the Court is plaintiff’s motion filed August 19, 2005, seeking reconsideration

of the Court’s August 5, 2005 order dismissing plaintiffs’ claims under § 11 and § 15 of the

Securities Act of 1933, as asserted against defendant Ellen Hancock (“Hancock”). For the

following reasons, the motion is DENIED, in its entirety.

1. The Court has already considered and rejected the Underwriter Defendants’

arguments that the pleading requirements of Rule 9(b) of the Federal Rules of Civil

Procedure apply to the § 11 claim asserted against them. (See Order Granting in Part and

Denying in Part Underwriter Defendants’ Motion to Dismiss; Granting Individual

Defendants’ Motion to Dismiss (“August 5 Order”), filed August 5, 2005, at 15-21.) The

Underwriter Defendants have not persuaded the Court that its ruling was incorrect. 

2. Contrary to the Underwriter Defendants’ assertion, there is no inconsistency in

Case 3:01-cv-02661-MMC Document 263 Filed 09/12/05 Page 1 of 2
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the Court’s rulings. The Court’s dismissal of plaintiffs’ § 10(b) claim, for failure to comply

with the pleading requirements of Rule 9(b), does not require dismissal of the § 11 claim

based on the same alleged misstatements of material fact, because Rule 9(b) has no

application to the § 11 claim. 

3. The Underwriter Defendants’ new argument that certain of the allegedly false

statements at issue in the § 11 claim are statements of “pure opinion,” and that no § 11

claim can be stated based on negligent statements of belief or opinion, is not properly

before the Court in a motion for reconsideration, as the Underwriter Defendants did not

raise the argument in their motion to dismiss.

4. There is no need to “clarify” the Court’s order as to which purportedly false

statements remain at issue with respect to the § 11 claim. The Court expressly noted the

statements at issue and denied the motion to dismiss the § 11 claim, as asserted against

the Underwriter Defendants, in its entirety. (See August 5, 2005 Order at 10, 21.) 

5. Because there is no basis for reconsideration of the Court’s August 5 Order as to

the Underwriter Defendants, there is no basis for granting the Underwriter Defendants an

extension of time to answer the complaint or a stay of discovery.

This order terminates Docket No. 254.

IT IS SO ORDERED.

Dated: September 12, 2005 MAXINE M. CHESNEY

United States District Judge

Case 3:01-cv-02661-MMC Document 263 Filed 09/12/05 Page 2 of 2