It has been a year since the U.S. Court of Appeals for the Fifth Circuit’s decision in Oscar Private Equity Investments v. Allegiance Telecom Inc. 1 imposed new barriers to class certification for securities fraud cases filed in the Fifth Circuit; however, to date, no other circuit court has followed its lead.
The reason is twofold. First, Oscar’s holding is in direct conflict with controlling Supreme Court precedent. Second, by creating new certification requirements, the Fifth Circuit has inappropriately placed the burden on plaintiffs to prove the merits of their case prior to trial.
