In re BioMarin Pharmaceutical Inc. Securities Litigation

Background

The parties filed a joint case-management statement, a joint discovery letter brief, and a motion to file that letter under seal. The court stated that most disputes had been addressed at a hearing and in a later minute order. This order addressed the remaining disputes.

Trading questions

At the hearing, the plaintiffs confirmed that they could address BioMarin’s questions about the ranking and rebalancing of the plaintiffs’ stocks during the relevant trading periods. The court ordered the plaintiffs to answer those questions in a declaration or another admissible form and, or alternatively as applicable, produce responsive materials.

Algorithm, spreadsheets, and databases

The parties disputed the extent of the plaintiffs’ access to, and production of, the trading algorithm, spreadsheets, and databases used to make trading decisions. BioMarin sought access because the plaintiffs said they used those materials to make buying and selling decisions related to the case. BioMarin intended to use the information to address the plaintiffs’ reliance theory and the fraud-on-the-market presumption—a legal presumption that investors relied on a security’s market price when bringing certain securities-fraud claims.

The plaintiffs argued that they had already provided the relevant information. They also argued that the additional information was not relevant or ascertainable, that reconstructing the full historical dataset might be impossible, and that the request was burdensome and disproportionate because the data concerned hundreds of companies and was continually updated.

The court concluded that BioMarin should be able to understand the algorithm the plaintiffs used to make trading decisions so BioMarin could attempt to show that price was not the main factor in those decisions. The court therefore ordered the plaintiffs to provide BioMarin access to the algorithm, spreadsheets, and underlying databases, to the extent those materials were available to the plaintiffs’ witness, Stig Harder, as described in the order and his deposition.

Implementation and disposition

The court acknowledged the plaintiffs’ uncertainty about how BioMarin would access the information, including the possibility of visiting Copenhagen, where the servers were apparently located. The court ordered the parties to meet and confer about the best access method and an appropriate timeline. Any resulting disputes were to be addressed in the joint case-management statement filed seven days before the case-management conference and hearing scheduled for April 12, 2023.

The order resolved discovery disputes; it did not decide the underlying securities-fraud claims.