Has Litwin v. Blackstone Group, 634 F. 3d 706, a decision last year from the U.S. Court of Appeals for the Second Circuit, made it easier for plaintiffs to bring complaints against companies for failing to disclose important trends relating to their products?
It has certainly played a role in the long-running fight between investment management company Panther Partners and semiconductor chip maker Ikanos Communications Inc. over Ikanos’s alleged failure to disclose product defects. On May 25, a unanimous Second Circuit panel cited the Blackstone case in holding that Southern District Judge Paul Crotty (See Profile) erred when he refused to allow Panther to file a second amended complaint because Panther failed to allege that Ikanos knew its defect rate was above average.
