On July 22, 2021, Judge Michael T. Liburdi of the United State District Court for the District of Arizona denied in part Defendants’ Motion to Dismiss shareholder class action claims under Section 11 and 15 of the Securities Act of 1933 in Lowthrop, et. al. v. Mesa Air Group Incorporated, et. al., Case No. 20-cv-000648. DeKalb County Pension Fund serves as sole lead plaintiff and Faruqi & Faruqi, LLP serves as sole lead counsel in this case.
The complaint alleges that the registration statement issued for Mesa Air’s 2018 initial public offering (“IPO”) failed to disclose materially adverse trends, uncertainties, and risks that Mesa Air faced at the time of the IPO. The Court upheld allegations that the registration statement contained false and misleading statements regarding Mesa Air’s qualified mechanics and personnel for aircraft maintenance at the time of the IPO. The statements also were in violation of Item 303 and 503 of SEC Regulation S-K, which require disclosure of known trends and risks. The Court rejected Defendants’ arguments that the statements were non-actionable opinions under Omnicare Inc. v. Laborers Dist. Council Constr. Indus. Pension Fund, 575 U.S. 175, 178 (2015) because the complaint alleged that certain statements contained an embedded statement of untrue fact and were misleading in their context.