Illumina, Grail Beat Investor Suit Over Doomed Acquisition (2)

Illumina Inc. and spun-off Grail Inc. defeated allegations the biotechnology company misled shareholders during the re-acquisition of the latter cancer-detection company.

Investors leading the case failed to sufficiently tie stock selloffs to revelations of alleged fraud for pleading loss causation, Judge Linda Lopez said. The investors’ theory would require them to trace losses after disclosures of disappointing financial news and shareholder and regulatory scrutiny back to what both companies and then-executives allegedly lied about, not have the US District Court for the Southern District of California “guestimate the connections.”

The management companies failed to adequately plead loss causation for ...