Opinion ID: 66401
Heading Depth: 4
Heading Rank: 1

Heading: Exchange Act Claims

Text: The district court held that its “loss causation holding in its denial of class certification [was] dispositive of Plaintiffs’ Exchange Act claims as a matter of law.” Order at 1, Ryan v. Flowserve, 245 F.R.D. 560 (N.D. Tex. 2008). For the reasons we have now twice explained, that holding is erroneous. Even if, contrary to our conclusion, we had found no error in the district court’s class-certification decision, its loss causation holdings under Rule 23’s preponderance requirement would not govern the merits of Alaska’s claims. Further, we are convinced that a genuine fact issue exists on the material element of loss causation under the Exchange Act because a reasonable trier of fact could at the least conclude that the October 2001 statement concerning Flowserve’s FY2002 earnings caused some portion of Alaska’s loss after the “relevant truth” began to leak out in July and September 2002. We therefore reverse the district court’s grant of summary judgment in favor of Flowserve Corp., Greer, and Hornbaker on Alaska’s Exchange Act claims. This ruling does not hamstring the district court during the class certification proceedings on remand. The district court must make an independent finding on loss causation for purposes of class certification under the preponderance-of-the-evidence standard. 14