The plaintiffs purchased mortgage pass-through certificates sponsored by Lehman Brothers Holdings, Inc. and underwritten by Lehman Brothers, Inc. (collectively Lehman Brothers). Standard & Poor’s, Moody’s Investors Service, Inc., and Fitch, Inc. (collectively, rating agencies) (defendants), businesses that evaluated the credit risk of securities, gave many of the plaintiffs’ certificates a AAA rating. The plaintiffs brought a class action suit against the rating agencies under § 11 of the Securities Act of 1933, claiming that the rating agencies were underwriters of the certificate offerings and thus strictly liable for false statements and omissions in the registration statements Lehman Brothers filed for the offerings. The plaintiffs alleged that banks issuing the certificates shopped for the highest possible ratings by playing the rating agencies off one another, and that the rating agencies actively helped in the process. According to the plaintiffs, the issuing banks established the ratings they wanted and negotiated with the rating agencies to decide which mortgages would be in a given pool in order to create a loan pool that fit the desired rating. The plaintiffs also alleged that the rating agencies gave their rating models to issuing banks to help the banks structure their pool submissions, and that the rating agencies failed to update the models to reflect the increase in subprime mortgages and weakening loan-origination standards. The result was undeservedly high credit ratings for many of the plaintiffs’ certificates. The district court dismissed the complaint. The plaintiffs appealed.