Northwest Biotherapeutics, Inc v. Canaccord Genuity LLC

Background

Northwest Biotherpeutics, Inc. filed the initial complaint on December 1, 2022. After defendants filed motions to dismiss, Northwest amended its complaint. The earlier motions therefore became moot. Defendants later moved to dismiss the First Amended Complaint, and Magistrate Judge Gary Stein held oral argument and issued a Report and Recommendation on December 29, 2023.

Judge Stein recommended dismissing the claims while allowing Northwest to amend. He found that Northwest had adequately pleaded most elements of its claims, but had not adequately pleaded loss causation. Both sides objected. Northwest challenged the loss-causation finding, while defendants challenged findings concerning scienter, manipulative acts, market effects, reliance, and the court’s consideration of certain trading data.

Court’s analysis

Judge Woods treated both sets of objections as sufficiently specific for a fresh review of the challenged issues. After reviewing the motion briefing and the objections, he rejected the objections and adopted Judge Stein’s Report and Recommendation in full.

The court agreed that the complaint should be dismissed because of the deficiency identified in the Report and Recommendation. It also concluded that another amendment would not necessarily be futile and that Northwest had not yet had the opportunity to amend with the benefit of the court’s ruling.

Ruling

Judge Woods granted defendants’ motion to dismiss without prejudice. He granted Northwest leave to amend the complaint to address the deficiencies described in the Report and Recommendation, and required any amended complaint to be filed within 30 days of the order. The clerk was directed to terminate the motion at docket entry 114.