Caption: Aramouni v. Acelyrin, Inc., et al.
Case No.: CV 23-9672 FMO (MAAx)
Jurisdiction: U.S. District Court, Central District of California
Judge: Hon. Fernando M. Olguin
Summary
On January 26, 2026, Judge Fernando M. Olguin granted defendants’ motion to dismiss the First Amended Class Action Complaint in the securities class action against Acelyrin, Inc. The Court dismissed all claims with leave to amend. Plaintiffs were granted an opportunity to file a Second Amended Complaint by February 5, 2026.
Allegations Against Acelyrin, Inc.
Plaintiffs alleged that Acelyrin and individual defendants made false or misleading statements and omissions concerning the clinical trials and efficacy of izokibep. According to the complaint, defendants failed to disclose patient discontinuation rates observed during clinical trials and omitted information about the statistical methodologies used to calculate trial results. Plaintiffs also alleged that these omissions were material to investors in connection with Acelyrin’s IPO.
Defendants’ Motion to Dismiss
Acelyrin and the individual defendants moved to dismiss the First Amended Complaint in its entirety. They argued that plaintiffs failed to plead scienter with particularity, failed to allege material misstatements or omissions, and did not satisfy the heightened pleading standards of the PSLRA. Defendants also argued that the challenged statements were protected by the PSLRA’s safe harbor and that Securities Act claims were subject to Rule 9(b).
Plaintiffs’ Opposition
Plaintiffs opposed dismissal by asserting that defendants knowingly or recklessly omitted discontinuation rates and methodological details from clinical trial disclosures. Plaintiffs argued that these omissions rendered defendants’ statements misleading and that defendants were motivated to maintain an inflated stock price in connection with the IPO. Plaintiffs also contended that the PSLRA safe harbor did not apply to the challenged statements.
Court’s Ruling
The Court granted defendants’ motion to dismiss in full. All claims in the First Amended Complaint were dismissed, but plaintiffs were granted leave to amend. The Court did not enter a final judgment and directed plaintiffs to either amend or file a notice of intent to stand on the dismissed complaint.
Court’s Rationale
Scienter: The Court held that plaintiffs failed to plead facts giving rise to a strong inference of scienter. The Court found plaintiffs’ motive theory implausible and noted the absence of allegations of insider stock sales.
Falsity and Materiality: The Court questioned whether the alleged omissions regarding clinical trial methodologies and discontinuation rates were materially misleading. It found that the complaint did not plausibly allege that disclosure of the omitted information would have significantly altered the total mix of information available to investors.
PSLRA Safe Harbor: The Court rejected defendants’ argument that all challenged statements were protected as forward-looking, explaining that mixed statements containing present or historical facts are not fully shielded by the PSLRA’s safe harbor.
Securities Act Claims: The Court held that plaintiffs’ Securities Act claims sounded in fraud because they were based on the same alleged misrepresentations as the Exchange Act claims. As a result, Rule 9(b)’s heightened pleading standard applied.
Case Status
The First Amended Complaint has been dismissed with leave to amend. Plaintiffs must file a Second Amended Class Action Complaint or a notice of intent to stand on the dismissed pleading by February 5, 2026. The case has not been finally resolved and may proceed if an amended complaint is filed.
