S&C Leads Adient to Second Circuit Victory in Shareholder ActionAugust 5, 2022
Adient, a global leader in automotive seating manufacturing, prevailed at the U.S. Court of Appeals for the Second Circuit as the court affirmed the dismissal of a shareholder action against the company and two individuals. The stockholders claimed they suffered losses as a result of defendants' alleged false statements about Adient's plans to improve certain aspects of its business and expand its profit margin.
The Second Circuit affirmed on various grounds. It held that the plaintiffs failed to allege that any defendant made a false statement, and that many of the challenged statements were inactionable forward-looking statements (accompanied by cautionary language), inactionable statements of opinion, and/or inactionable puffery. Finally, the court held that the plaintiffs failed to plead facts giving rise to a strong inference of scienter.
The court also affirmed the lower court's denial of the plaintiffs' motion to set aside the judgment and for leave to amend their complaint to allege newly-discovered evidence, holding that the evidence could have been discovered before the motion to dismiss ruling.
S&C also represented Adient in the district court win in the Southern District of New York, where the district court adopted virtually all of Adient's arguments in support of dismissal.
The S&C team consisted of Jeffrey Scott, Matthew Porpora (who argued the appeal), Sean Fulton and Tasha Thompson.