Krim v. pcOrder.com, Inc.
United States Court of Appeals for the Fifth Circuit
402 F.3d 489 (2005)
pcOrder.com, Inc. (defendant) conducted two public stock offerings, each with its own registration statement, and a group of purchasers (plaintiffs), led by Burke and Petrick, sued under § 11 of the Securities Act, alleging the registration statements contained false information. Burke and Petrick bought their shares when 91% of PCOrder shares on the market had come from the public offerings, and presented expert testimony suggesting close to a 100% statistical chance that at least one of their shares originated from a falsely-registered offering. The district court nonetheless dismissed for lack of standing, holding a plaintiff must show 100% of the stock at issue came directly from a public offering; Burke and Petrick appealed.
Whether aftermarket purchasers seeking § 11 standing must demonstrate that their shares are traceable to the challenged registration statement.