District Court Cites Recent "Evolution" Of Rule 23 Standards To Deny Class Certification Motion In Securities Action Based Upon Allegedly Misleading Registration Statement

In In re Kosmos Energy Ltd. Securities Litigation, No. 3:12-CV-373-B, 2014 U.S. Dist. LEXIS 36365 (N.D. Tex. Mar. 19, 2014), the United States District Court for the Northern District of Texas (Boyle, J.) denied lead plaintiff's class certification motion in a consolidated action alleging claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 ("1933 Act"), 15 U.S.C. §§ 77k, 77l(a)(2), 77o.  The 1933 Act regulates registration and offering statements by holding issuers and other offering participants strictly liable for material misstatements and omissions.  Reliance is not an element of the claim.  Plaintiff's class certification motion rested on the notion that 1933 Act claims presumptively deserve class treatment.  The district court, however, rejected the continued vitality of this notion in light of the recent "evolution of the case authority on class certification" requiring "a more skeptical view with a more exacting review process."