NOT PRECEDENTIAL 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

_____________ 

No. 18-2474 

_____________ 

GREGORY VIZIRGIANAKIS; PHONG THOMAS DINH; JAMSHID KHODAVANDI 

v. 

 AETERNA ZENTARIS, INC.; JUERGEN ENGEL; DAVID A. DODD; PAUL 

BLAKE; NICHOLAS J. PELLICCIONE 

Appellants 

____________ 

On Appeal from the United States District Court 

for the District of New Jersey 

(No. 3:14-cv-07081) 

District Judge: Hon. Peter G. Sheridan 

Submitted under Third Circuit L.A.R. 34.1(a) 

April 2, 2019 

Before: CHAGARES, HARDIMAN, and SILER, JR.,*

 Circuit Judges

(Filed: May 30, 2019) 

____________ 

OPINION

____________ 

 *

 The Honorable Eugene E. Siler, Jr., United States Circuit Judge for the Court of 

Appeals for the Sixth Circuit, sitting by designation. 

 This disposition is not an opinion of the full Court and, pursuant to I.O.P. 5.7, 

does not constitute binding precedent. 
2 

SILER, Circuit Judge.

 Pursuant to Federal Rule of Civil Procedure 23(f), defendants Aeterna Zentaris, 

Inc., and its named former employees,1

 appeal the district court’s order granting class 

certification in this securities action. We will affirm the decision of the district court. 

I. 

 We write for the parties and relate only the necessary facts. In 2009, the 

biopharmaceutical company Aeterna acquired the rights to AEZS-130, a drug in 

development it sought to have approved for commercialization by the Food and Drug 

Administration (“FDA”). To this end, Aeterna agreed to continue an ongoing study of 

the drug according to the terms of a Special Protocol Assessment (“SPA”), an agreement 

between Aeterna and the FDA regarding how the study should be completed to show the 

drug’s safety and efficacy. 

 According to the complaint, Aeterna issued numerous press releases and other 

statements indicating that the study showed the drug was effective in accordance with the 

protocol agreed to by the FDA in the SPA. Based on the strength of the “successful” 

study, Aeterna sold nearly $75 million of its common stock to the investing public. 

 In reality, says the complaint, AEZS-130 failed to show efficacy. And in 

November 2014, the FDA denied Aeterna’s application to market AEZS-130 publicly, 

 1

 These former employees are: David A. Dodd, Juergen Engel, Nicholas J. Pelliccione, 

and Paul Blake. 
3 

because the planned analysis of Aeterna’s “pivotal trial did not meet its stated primary 

efficacy objective as agreed to in the Special Protocol Assessment agreement letter 

between [Aeterna] and the FDA.” 

 The current action was filed by Aeterna shareholders. The class action complaint 

alleges Aeterna violated Section 10(b) of the Exchange Act and Rule 10b-5 by carrying 

out a plan to deceive the investing public and cause class members to purchase Aeterna 

stock at artificially inflated prices. It further alleges that several former Aeterna 

employees are liable under Section 20(a) of the Exchange Act by virtue of their influence 

and control over the false and misleading statements by Aeterna. The district court 

granted plaintiffs’ motion for class certification under Federal Rule of Civil Procedure 

23(b)(3). Pursuant to Rule 23(f), Aeterna timely appealed. 

II.2

“We review a class certification order for abuse of discretion.” Neale v. Volvo 

Cars of North America, LLC, 794 F.3d 353, 358 (3d Cir. 2015) (quoting Grandalski v. 

Quest Diagnostics Inc., 767 F.3d 175, 179 (3d Cir. 2014)). We bear in mind “[t]he trial 

court, well-positioned to decide which facts and legal arguments are most important to 

each Rule 23 requirement, possesses broad discretion to control proceedings and frame 

issues for consideration under Rule 23.” In re Hydrogen Peroxide Antitrust Litigation, 

552 F.3d 305, 310 (3d Cir. 2008) (citation omitted). 

 2

 The district court had jurisdiction under 28 U.S.C. § 1331. We have jurisdiction 

under 28 U.S.C. § 1292(e) and Rule 23(f). 
4 

III. 

 In a § 10(b) private action, a plaintiff must prove reliance upon the alleged 

misrepresentation or omission. Stoneridge Inv. Partners, LLC v. Scientific-Atlanta, 552 

U.S. 148, 157 (2008) (citing Dura Pharmaceuticals, Inc. v. Broudo, 544 U.S. 336, 341-

42 (2005)). The district court found that plaintiffs could proceed under a fraud-on-themarket theory of reliance. This theory “accords plaintiffs in Rule 10b-5 class actions a 

rebuttable presumption of reliance if plaintiffs bought or sold their securities in an 

efficient market.” In re Burlington Coat Factory Securities Litigation, 114 F.3d 1410, 

1419 n.8 (3d Cir. 1997) (internal quotation omitted). 

 Here, plaintiffs provided an expert report completed by Dr. Adam Werner to prove 

market efficiency; the report relied on four dates on which information related to the 

development of AEZS-130 was disseminated to conclude that Aeterna stock reflected 

publicly available information. On appeal, Aeterna does not contest that plaintiffs raised 

the presumption of an efficient market, and therefore class-wide reliance. It argues the 

district court erred in finding that it had not rebutted the presumption. 

 Aeterna’s hired expert, Dr. David Tabak, responded to the declaration of 

plaintiffs’ expert, pointing out that Dr. Werner had not proven—to a 95% confidence 

level—that the alleged misrepresentations made on August 30, 2011 impacted the price 

of Aeterna’s common stock. The district court found this evidence insufficient to rebut 

the presumption. It aptly noted that plaintiffs do not have the burden to prove price 

impact (or lack thereof), so it was not surprising that their expert’s report did no such 

thing. And even were plaintiffs’ study attempting to demonstrate a price impact, the 
5 

district court reasoned that its failure to do so is not necessarily proof of the opposite. 

This conclusion is consistent with the opinion of Dr. Werner and other district courts 

weighing similar event studies, including two in this circuit. See West Palm Beach Police 

Pension Fund v. DFC Global Corp., No. 13-6731, 2016 WL 4138613, *14 (E.D. Pa. 

Aug. 4, 2016) (“[I]t does not necessarily follow from the mere absence of a statistically 

significant change in the stock price that there was no price impact” (internal quotation 

omitted)); City of Sterling Heights Gen. Empl. Ret. Syst. v. Prudential Finan., Inc., No. 

12-5275, 2015 WL 5097883, *12 (D.N.J. Aug. 31, 2015) (failure of statistical 

significance on one of six alleged misstatement dates did not show a lack of price impact 

sufficient to rebut presumption of reliance). 

 Further, Dr. Werner found abnormal stock return to a 95% confidence level for the 

other three events in his study, one of which was Aeterna’s June 26, 2012 representation 

regarding AEZS-130. Dr. Tabak’s contention that plaintiffs’ legal theory precludes them 

from relying on the 2012 representation is a legal conclusion, which the district court 

could reject. See Berckeley Inv. Grp. Ltd. v. Colkitt, 455 F.3d 195, 217 (3d Cir. 2006) 

(explaining that “an expert witness is prohibited from rendering a legal opinion”). Dr. 

Tabak’s contention that the 2012 representation did not provide any new, market-relevant 

information conflicts with Dr. Werner’s opposite conclusion. Weighing conflicting 

expert testimony is a normal task of the district court at the certification stage and 

Aeterna has not shown the district court abused its discretion weighing it here. See In re 

DVI, Inc. Sec. Lit., 639 F.3d 623, 633 (3d Cir. 2011), abrogated on other grounds by

Amgen Inc. v. Conn. Ret. Plans & Trust Funds, 568 U.S. 455 (2013). 
6 

Finally, Aeterna misreads the district court opinion when it contends the district 

court required it to rebut the presumption by proving “with scientific certainty” that the 

alleged misrepresentation caused no price movement, a burden it deems “impossible” and 

unknown to science and law. Given that the bulk of the reliance challenge centered on 

statistical analysis, and a certainty level agreed to by both parties, it is hollow indeed that 

Aeterna would read the opinion and believe it divorced from this context. 

IV. 

In sum, the district court considered the expert report tendered by Aeterna. In 

light of plaintiffs’ expert and caselaw concluding otherwise, it rejected Dr. Tabak’s 

conclusion that lack of price impact was proven by Dr. Werner’s failure to prove price 

impact in his report on market efficiency. The district court also credited Dr. Werner’s 

conclusion that the 2012 statement conveyed new, valuation-relevant information, despite 

Dr. Tabak’s concluding the opposite. Weighing conflicting expert testimony and making 

factual findings are normal functions of the district court at this stage. DVI, 639 F.3d at 

633. Aeterna has not shown that either decision was an abuse of discretion. 

We will affirm.