In re VEON Ltd. Securities Litigation

Background

The court stated that it had previously granted in part and denied in part Defendants’ motion to dismiss. Defendants later sought a pre-motion conference for a proposed motion for judgment on the pleadings under Rule 12(c), while Westway sought a pre-motion conference to request permission to file a second amended complaint adding three named plaintiffs. The court denied both requests for a pre-motion conference and set a briefing schedule. VEON answered the amended complaint, and Defendants filed the motion addressed in this order.

Arguments

Defendants argued that the court’s earlier order limited the class period to investors who purchased VEON shares between June 30, 2011, and November 3, 2015, and held those shares until at least March 12, 2014. Defendants also argued that the order identified June 2011 as the date of the earliest actionable alleged misstatements, before Lead Plaintiff Westway purchased VEON American depositary receipts. Based on that timing, Defendants argued that Westway was not injured by VEON’s alleged misstatements and lacked standing to serve as Lead Plaintiff.

Westway did not dispute that the earlier order identified June 2011 as the date of the first actionable misstatement. Westway argued, however, that Defendants had made actionable omissions before June 2011 by failing to disclose information about their knowing lack of adequate company controls. Westway argued that these alleged omissions could support an injury sufficient for constitutional standing.

Court’s Analysis

The court agreed that Westway had not alleged the pre-June 2011 omissions or a duty to disclose in the operative complaint. It stated that raising arguments based on allegations not included in the operative complaint is strongly disfavored. Nevertheless, to allow the case to be decided on its merits, the court decided to give Westway an opportunity to amend the complaint to add the omissions allegations.

Disposition

The court denied Defendants’ motion for judgment on the pleadings without prejudice. It ordered Westway’s second amended complaint due April 14, 2020, and stated that the order terminated ECF No. 132. This was a procedural ruling on the Rule 12(c) motion and did not decide whether Westway ultimately had standing or whether the proposed omissions allegations were legally sufficient.