b'This year, we once again focused our Year in ReviewOnce again, there were several decisions and cases to on three jurisdictions, which include the most activewatch coming out of the Ninth Circuit and the California technology hubs in the country and, thus, have beenand Nevada District Courts. In the only Ninth Circuit among the most active jurisdictions for securities classdecision, the court affirmed the district courts dismissal actions filed against such companies: the U.S. Courtof plaintiffs claims concerning alleged misstatements of Appeals for the Ninth Circuit and California andand omissions related to data security vulnerabilities, Nevada District Courts; the U.S. Court of Appeals foragreeing with the district courts conclusion that the Second Circuit and New York and Connecticutplaintiffs failed to plead scienter. California District District Courts; and the U.S. Court of Appeals for theCourts were very active and several cases were First Circuit and District of Massachusetts. Courtsdismissed on grounds that plaintiffs failed to adequately in the Second and Ninth Circuits were particularlyallege that defendants made actionable false or active in 2020, accounting for 70% of all core federalmisleading statements and/or that plaintiffs failed to class action filings (across all industries) in 2020;allege particularized factsas required under Federal filings in the Ninth Circuit alone increased by 52%Rule of Civil Procedure 9(b) and the Private Securities to 79 filings, the highest number on record for thatLitigation Reform Act (PSLRA)that the defendants circuit.12 The perceived defendant-friendly First Circuit,made any such statements or omissions with scienter by contrast, experienced a decrease of 67% in core(i.e., intentionally or recklessly). The Ninth Circuit is class action filings.13 likely to be very active in the coming year and we have In 2020, federal courts in these jurisdictions oncesummarized ten cases to watch that have been filed again issued several significant, detailed decisionsagainst technology companies.in securities class actions against technologyThe Second Circuit and New York and Connecticut companies in various growth stages and theirDistrict Courts also delivered a number of interesting directors and officers. As in prior years, these casesdecisions in 2020. In the lone Second Circuit decision involve disclosures concerning issues that technologycaptured in this report, the court affirmed the district companies most often face, including revised orcourts dismissal of plaintiffs second amended missed financial guidance, slowed growth, regulatorycomplaint and its denial of plaintiffs motion for leave compliance, operational risks, performance of productsto file a third amended complaint. The Second Circuit and services, and design vulnerabilities. agreed with the district courts holdings that the 12 Cornerstone Report, at 33.13 Id.7'