STECKMAN v. HART BREWING, INC.

No. 97-55199.

143 F.3d 1293 (1998)

Jeffrey D. STECKMAN, and all others similarly situated, Plaintiff-Appellant, v. HART BREWING, INC.; George Hancock; John Stoddard; Don Burdick; John E. Morse; Peter T. Morse; John T. Bryce; Marcia L. Ellis; Janet Morse; Paine Webber, Inc.; Dean Witter Reynolds, Inc., Defendants-Appellees.

United States Court of Appeals, Ninth Circuit.

Decided May 14, 1998.


Attorney(s) appearing for the Case

James C. Krause, Patrick N. Keegan, Krause & Kalfayan, San Diego, CA; Burton H. Finkelstein, Finkelstein, Thompson & Loughran, Washington, DC, for plaintiff-appellant.

Stellman Keehnel, Peter S. Ehrlichman, Tim J. Filer, Foster Pepper & Shefelman PLLC, Seattle, Washington; Shirli Fabbri Weiss, Gray Cary Ware & Freidenrich, San Diego, California, for defendants-appellees Hart Brewing Inc., George Hancock, John Stoddard, Don Burdick, John E. Morse, Peter T. Morse, John T. Bryce, Marcia L. Ellis and Janet Morse.

William F. Alderman, John H. Kanberg, Tanya Herrera, Orrick, Herrington & Sutcliffe LLP, San Francisco, California, for defendants-appellees PaineWebber Incorporated and Dean Witter Reynolds, Inc.

Before: FARRIS, O'SCANNLAIN, and FERNANDEZ, Circuit Judges.


FARRIS, Circuit Judge:

BACKGROUND

Pyramid Breweries Inc., formerly Hart Brewing Inc., a maker of craft beers, conducted an initial public offering on December 13, 1995, less than three weeks before the end of the fourth quarter. Shares were priced at $19, netting the company $34.2 million.

According to Pyramid's uncontested prospectus, gross sales grew at a compound annual rate of around 88% from 1990 to the

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