On November 2, 2015, in Hampton v. PIMCO, LLC, the U.S. District Court for the Central District of California granted the defendants’ motion to dismiss a putative shareholder class action that had been filed against a fund and its adviser and trustees. When filed in January, the plaintiff’s complaint alleged various misrepresentations by the defendants in violation of Rule 10b-5 under the Exchange Act. The plaintiff’s amended complaint, filed in July 2015, dropped the federal securities law claims and, instead, made direct claims against the defendants under various state law theories, including breach of contract and breach of trust. The amended complaint appeared to have been reworked to try to take advantage of the Ninth Circuit’s holdings in Northstar.
In its November 2 decision, the district court held that each of the plaintiff’s claims rested on allegations of misrepresentations by the adviser, the fund, or the fund’s trustees. Therefore, the court found that the plaintiff’s claims were precluded by SLUSA and, therefore, dismissed each of the claims.
The plaintiff filed a notice of appeal of the district court decision with the Ninth Circuit on November 30.