U.S. District Judge William Orrick III, Northern District of California (S. Todd Rogers / The Recorder)
SAN FRANCISCO — With help from Keker & Van Nest, Emeryville-based Amyris Inc. has shaken off a securities suit alleging executives misled the market about the company’s success developing a plant-based fuel alternative.
Plaintiffs lawyers at Milberg declined to amend their complaint after a federal judge dismissed the shareholder suit in March. U.S. District Judge William Orrick III of the Northern District of California closed the case last week.
“We’re very pleased that the plaintiffs decided to walk away,” Keker & Van Nest partner Michael Celio said. “It was the right decision based on the facts.”
Milberg partner David Azar, lead plaintiffs attorney, declined comment.
Amyris went public in 2010. The following year, executives issued a press release announcing completion of the company’s first industrial-scale biofuel plant in Brazil. In a subsequent conference call, CEO John Melo said he expected $1 billion in annual sales by 2013.
But plaintiffs attorneys alleged that Amyris failed to disclose that obstacles in setting up the Brazil plant had made it impossible for the company to meet its goals. In November 2011, Amyris began to publicly acknowledge it was unlikely to meet its projections, prompting a stock drop of almost 20 percent.
“Like any early stage technology, it took a little longer to get it commercialized than they thought it would,” Celio said. “And plaintiffs had alleged that these failed predictions were in some way fraudulent, and that was never fair and never accurate.”
Orrick sided with Celio, ruling the statements in question were generalized “puffery” or forward-looking predictions, not intentional misrepresentations.
A derivative suit pending against Amyris had been stayed. “We’re hopeful that those plaintiffs will come to the same conclusion,” Celio said.
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