Lampkin Opinion | Sec Rule 10b 5 | Federal Rules Of Civil Procedure

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    IN THE UNITED STATES DISTRICT COURTFOR THE SOUTHERN DISTRICT OF TEXASHOUSTON DIVISIONIn Re ENRON CORPORATION § SECURITIES, DERIVATIVE & § MDL 1446 ERISA LITIGATION, § KEVIN LAMPKIN, JANICE SCHUETTE,§ ROBERT FERRELL, AND STEPHEN § MILLER, Individually and on § Behalf of All Others Similarly § Situated, § § Plaintiffs, § § VS. § CIVIL ACTION NO. H-02-0851 § UBS PAINEWEBBER, INC. AND § UBS WARBURG, LLC, § § Defendants. § OPINION AND ORDER  The above referenced putative class action allegesviolations of the following securities fraud statutes throughDefendants’ scheme to optimize revenue in investment banking feesfrom UBS Securities LLC’s corporate client, Enron Corp. (“Enron”),at the expense and defrauding of UBS Financial Service’s brokerageretail clients, Lead Plaintiffs Kevin Lampkin, Janice Schuette,Bobby Ferrell, Stephen Miller, Terry Nelson, Diane Swiber, FranklinGittess, and Joe Brown and similarly situated individuals: §§ 11,12(a)(2) and 15 of the Securities Act of 1933 (“the 1933 Act”), 15U.S.C. §§ 77k, 77l, and 77o, et seq. ; §§ 10(b) and 20 of theSecurities Exchange Act of 1934 (“the 1934 Act”), 15 U.S.C. §§ 78j(b) and 78(t), et seq. , and Rule 10b-5, 17 C.F.R. § 240.10b-5; United States District Court Southern District of Texas ENTERED February 28, 2017 David J. Bradley, Clerk ! #$ &'()*+,*((-./ 01+23$45 )). 678$9 74 :;<0 14 ()=)-=/> ? @$ / 1A ))-  and the Private Securities Litigation Reform Act (“PSLRA”), 15U.S.C.§ 78u-4. The 1933 Act claims are brought against UBSFinancial Services, Inc. f/k/a UBS Paine Webber, Inc. (“PW”) only. #122 ¶¶ 228, 269. Pending before the Court are (1) a motion to dismiss theThird Amended Complaint, 1  filed by Defendants PW 2  and UBS SecuritiesLLC f/k/a UBS Warburg LLC (Warburg”), 3  (collectively, “UBSDefendants”) (Notice of Motion to Dismiss, instrument #125;Memorandum in support, #126); (2) an alternative motion for leaveto amend complaint from Lead Plaintiffs Kevin Lampkin, JaniceSchuette, Bobby Ferrell, Stephen Miller, Terry Nelson, Diane Swiber,Franklin Gittess, and Joe Brown; (#164);(3) a motion to certifyclass (#166), filed by Lead Plaintiffs; and (4) an opposed motionfor amended scheduling order, for additional briefing, and for aruling (#223), filed by Plaintiffs. Plaintiffs in this action have elected to proceedindependently of the complaints in the Newby   and Tittle  actions in 1   Third Amended Complaint is instrument #122. 2   PW is a Delaware corporation authorized to do businessin Texas and is a wholly owned subsidiary of Switzerland’s bankingconglomerate UBS AG. #122 at ¶ 13. 3  Warburg is a Delaware limited liability companyauthorized to do business in Texas and also a wholly ownedsubsidiary of UBS AG. #122 ¶ 14.Warburg and PW are collectively referred to as“Defendants.” #122 ¶ 15. Warburg, PW and UBS AG are collectivelyreferred to as “UBS.” Id. - 2 - ! #$ &'()*+,*((-./ 01+23$45 )). 678$9 74 :;<0 14 ()=)-=/> ? @$ ) 1A ))-  MDL 1446.As housekeeping matters, given the age of this litigation,the lengthy discovery period now closed, and the extensive briefingalready filed in this case regarding the claims against the UBSDefendants, the Court denies the motion for amended scheduling orderand for additional briefing as unnecessary (#223). In additionbecause Plaintiffs have already been permitted to file fourcomplaints (#1, 6, 20, and 122), the Court denies their alternativemotion for leave to file another (#164). Finally, in light of theissuance of this Opinion and Order, the Court finds that theremaining motion for a ruling (also part of #223) is MOOT.The Court leaves aside the name-calling, subjectiveaccusations, and denigrating remarks in the various documents itreviews and focuses on the merits of the parties’ contentions. I. Standards of Review A. Rule 8(a) Federal Rule of Civil Procedure 8(a) states,A pleading that states a claim for relief mustcontain:(1) a short and plain statement of the groundsfor the court’s jurisdiction, unless the courtalready has jurisdiction, and the claim needsno new jurisdictional support;(2) a short and plain statement of the claimshowing that the pleader is entitled to relief;and(3) a demand for the relief sought, which may - 3 - ! #$ &'()*+,*((-./ 01+23$45 )). 678$9 74 :;<0 14 ()=)-=/> ? @$ B 1A ))-  include relief in the alternative or differenttypes of relief.Under the Rule’s requirement of notice pleading, “defendants in alllawsuits must be given notice of specific claims against them.” Anderson v. U.S. Dept. of Housing and Urban Development , 554 F.3d525, 528 (5 th  Cir. 2008). While a plaintiff need not plead specificfacts, the complaint must provide “the defendant fair notice of whatthe . . . claim is and the grounds upon which it rests.” BellAtlantic Corp. v. Twombly  , 550 U.S. 544, 555 (2007). If thecomplaint lacks facts necessary to put a defendant on notice of whatconduct supports the plaintiff’s claims against it, the complaintis inadequate to meet the notice pleading standard. Anderson , 554at 528 . The complaint must not only name the laws which thedefendant has allegedly violated, but also allege facts about theconduct that violated those laws.   Id. B. Rule 12(b)(6) When a district court reviews a motion to dismiss pursuantto Fed. R. Civ. P. 12(b)(6), it must construe the complaint in favorof the plaintiff and take all well-pleaded facts as true. RandallD. Wolcott, MD, PA v. Sebelius , 635 F.3d 757, 763 (5 th  Cir. 2011), citing Gonzalez v. Kay  , 577 F.3d 600, 603 (5 th  Cir. 2009). Theplaintiff’s legal conclusions are not entitled to the sameassumption. Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009)(“The tenetthat a court must accept as true all of the allegations contained - 4 - ! #$ &'()*+,*((-./ 01+23$45 )). 678$9 74 :;<0 14 ()=)-=/> ? @$ & 1A ))-
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