A district court granted a corporation’s motion to dismiss a securities fraud class action on the grounds that the consolidated complaint failed to satisfy the pleading requirements of Rule 8 of the Federal Rules of Civil Procedure. Rule 8 requires claims to be set out in short and plain terms. Defendants argued, and the Court agreed, that the complaint, containing 735 paragraphs in 228 pages and 67 pages of exhibits, was a “morass of allegations regarding an alleged ‘scheme of option backdating and spring-loading,’ a ‘submarine patent scheme,’ various infringement suits and regulatory actions, a bond offering, and alleged insider trading.”
The Court also found that the complaint was “[l]oaded with multiple theories of conspiracies and wrongdoing” spanning a 13 year period, did not specify which allegations were asserted against which defendants, and required both the Court and defendants to guess as to which parties were involved in which allegedly fraudulent activity. The Court rejected the plaintiffs’ argument that the complaint’s length and complexity was required to meet the heightened pleading standard of the Private Securities Litigation Reform Act, ruling that the heightened standard was not an invitation to adopt a “kitchen-sink” approach to a pleading, nor an invitation to disregard Rule 8’s requirement of “simplicity, directness and clarity.” (Kelley v. Rambus, Inc., 2007 WL 3022544 (N.D. Cal.Oct. 15, 2007)).