Berger v. Compaq Computer Corp.

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT
_______________

m 00-20875
_______________

MARK BERGER, ETC., ET AL.,

Plaintiffs,

MARK BERGER,
ON BEHALF OF HIMSELF AND ALL OTHERS SIMILARLY SITUATED,

Plaintiff-Appellee,

VERSUS

COMPAQ COMPUTER CORPORATION, ET AL.,

Defendants,

COMPAQ COMPUTER CORPORATION; ECKHARD PFEIFFER; EARL L. MASON;
JOHN T. ROSE; JOHN W. WHITE; ROBERT W. STEARNS; MICHAEL WINKLER;
THOMAS J. PERKINS; J. DAVID CABELLO; MICHAEL HEIL; GREGORY E. PETSCH;
KENNETH L. LAY; BENJAMIN ROSEN; AND RODNEY SCHROCK,

Defendants-Appellants.

_________________________

Appeal from the United States District Court
for the Southern District of Texas
_________________________
January 14, 2002
 ON PETITION FOR plaintiff and lead counsel, a court may grant
REHEARING EN BANC class certification only if the putative class rep-
resentative possesses a certain level of experi-
(opinion 257 F.3d 475 (5th Cir. ence, expertise, wealth or intellect, or a level
July 25, 2001)) of knowledge and understanding of the issues,
beyond that required by our long-established
Before SMITH, DUHÉ, and WIENER, standards for rule 23 adequacy of class repre-
Circuit Judges. sentatives.

PER CURIAM:

Treating the petition for rehearing en banc
as a petition for panel rehearing, the petition
for panel rehearing is DENIED. No member
of the panel or judge in regular active service
having requested that the court be polled on
rehearing en banc, see FED. R. APP. P. 35; 5TH
CIR. R. 35, the petition for rehearing en banc
is DENIED.

In support of their petition for rehearing,
plaintiffs urge that we have created an addi-
tional, independent requirement for the ade-
quacy standard for class certification under
Federal Rule of Civil Procedure 23 by reading
the provisions of the Private Securities Litiga-
tion Reform Act of 1995 (“PSLRA”) into rule
23(a)(4).

This we have not done, nor have we
changed the law of this circuit regarding the
standard for conducting a rule 23(a)(4) ade-
quacy inquiry. Rather, we mean to emphasize
that Congress enacted the “lead plaintiff” pro-
visions of the PSLRA, 15 U.S.C. § 78u-4(a)-
(3)(B), to direct courts to appoint, as lead
plaintiff, the most sophisticated investor avail-
able and willing so to serve in a putative secur-
ities class action. Insofar as possible following
the procedure prescribed by § 78u-4(a)(3)(B),
the lead plaintiff should be an investor capable
of understanding and controlling the litigation.
We have not, however, created an additional
requirement under rule 23(a)(4) that, after
completing the process of selecting the lead