After sifting through a plaintiff’s “hydra-like” complaint, a Manhattan judge has dismissed a putative class action, filed on behalf of a union pension fund, alleging that American Express and two executives made false and misleading statements to investors in 2006 and 2007 about the types of credit risk the company faced as it attempted to expand its share of the credit card market beyond AmEx’s traditional high-end clientele.
“While securities fraud claims must be pled with particularity, a plaintiff need not lard a pleading with streams of consciousness from confidential witnesses and block quotes from analyst calls,” Southern District of New York Judge William H. Pauley wrote in Local No. 38 International Brotherhood of Electrical Workers Pension Fund v. American Express Company, 09 civ. 3016. “Plaintiff’s hydra-like complaint sprawls over 243 paragraphs, some silted with more than 500 words. For purposes of this motion, this court accepts the factual allegations in the complaint as true and has endeavored to summarize them. However, that task was a challenge. Where distillation eluded this court, the unfiltered allegations are excerpted. If this sounds like an apologia for the following summary, it is.”
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