BOSTON, April 9, 2019: Morgan Lewis secured a rare dismissal with prejudice on the first motion to dismiss filed in a securities fraud class action brought against Tempur Sealy International Inc., a global bedding provider, and its CEO and former CFO.
In In re Tempur Sealy International Securities Litigation, the shareholder plaintiffs brought suit after Tempur Sealy announced the termination of its relationship with its largest customer, Mattress Firm, which adversely affected Tempur Sealy’s stock price.
Judge Lewis Kaplan of the US District Court for the Southern District of New York adopted virtually all of Morgan Lewis’s arguments, dismissing the case for four independently dispositive reasons. The court rejected certain of plaintiffs’ allegations “for the reasons stated in defendants’ brief.” Highlighting the unsupported nature of the plaintiffs’ conclusory fraud allegations, the judge stressed: “Plaintiffs simply assert that the defendants would have known [the alleged omissions]—presumably via clairvoyance and a secret window into the corporate thinking and workings of Mattress Firm,” but "assuming, as the court does, that defendants had neither,” he held the plaintiffs’ claims were legally defective.
“This ruling ends the case in the trial court, on behalf of all defendants, on the very first motion filed,” said Morgan Lewis partner Jordan Hershman, lead counsel for Tempur Sealy and leader of securities litigation at the firm.
Jordan and partners Jason Frank and Emily Renshaw; of counsel Jeff Goldman; and senior attorney Lauren Carpenter led the Morgan Lewis team advising Tempur Sealy.