Cluster 2568801

Corp., 588 F.Supp.2d at 1175; see also In re World-Com, Inc., 346 F.Supp.2d at 673 (“It is equally important to note that what constitutes a red flag depends on the facts and context of a particular case.”); In re Enron Corp. Sec., Derivative & ERISA Litig., 258 F.Supp.2d 576, 597 (S.D.Tex.2003) (“[R]easonableness in this context is not a question properly resolved on a motion to dismiss.” (internal quotation marks omitted)).

Litig., 346 F.Supp.2d 628, 689 (S.D.N.Y. 2004) (“[N]on-disclosure of an -15- underwriter or issuer’s conflicts of interest can constitute material omissions, even where no regulation expressly compels the disclosure of such conflicts.”).

Lit, 346 F.Supp.2d 628, 663 (S.D.N.Y. 2004) (“Section 12(a)(2) ... only requires the defendant to show that it used reasonable care [in order to defeat liability].”).

WorldCom, 346 F.Supp.2d at 628 ("Summary Judgment Opinion").

WorldCom, 346 F.Supp.2d at 628 (“Summary Judgment Opinion”).

A registration statement “ ‘includes the prospectus and other information required by section 7 of the Securities Act.’ ” In re WorldCom, Inc. Securities Litigation, 346 F. Supp. 2d 628, 657 (S.D.N.Y. 2004) (quoting 12 C.F.R. § 16.2 (m) (1994)).

Litig. , 346 F Supp 2d 628,657 [SD NY 2004] [finding duty under section 11 to comply with federal regulation S-K]).

Litig. , 346 F Supp 2d 628,657 [SD NY 2004] [finding duty under section 11 to comply with federal regulation S-K]).

Litig., 346 F. Supp. 2d 628, 688 (S.D.N.Y. 2004); see also Even assuming the executives traveled from Wuhan itself (which is not alleged), the fact that they knew about these advisories does not create a plausible inference that they knew COVID-19 would present a material threat to their Company in the future.

Litig., 346 F. Supp. 2d 628, 657 (S.D.N.Y. 2004) (quoting 12 C.F.R. § 16.2 (m)), which in this case disclosed that Kalani was an underwriter.

In re WorldCom was a Securities Act case brought pursuant to § 11(b), 15 U.S.C. § 77k, and addressed the specific affirmative defense of due diligence, which is unique to that provision and which M&T did not raise here. 346 F.Supp.2d at 636-67, 659 , 662-64 .

(WorldCom), 346 F.Supp.2d 628, 663 (S.D.N.Y. 2004) (Cote, J.).

“In order for an accountant’s opinion to qualify as an expert opinion under Section 11(b)(3)(C), ... it must be reported in the Registration Statement [and] be an audit opinion.” In re WorldCom, Inc. Securities Litigation, 346 F.Supp.2d 628, 664-65 (S.D.N.Y. 2004).

Litig., 346 F.Supp.2d 628, 663-64 (S.D.N.Y.2004).

Elements of Sections 11 and 12(a)(2) Claims This Court has previously discussed at length the structure and aims of the Securities Act, see In re WorldCom, Inc. Securities Litigation, 346 F.Supp.2d 628, 656-64 (S.D.N.Y.2004), and that discussion is incorporated by reference.

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 691 (S.D.N.Y.2004).

In re WorldCom, Inc. Securities Litigation, 346 F.Supp.2d 628, 678 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 687-88 (S.D.N.Y.2004) (noting that “there is no duty to disclose information to one who reasonably should already be aware of it,” and that "where information is equally available to both parties, a defendant should not be held liable to the plaintiff under securities laws for failure to disclose”) (quoting Seibert v. Sperry Rand Corp., 586 F.2d 949, 952 (2d Cir.1978)). .

Litig., 346 F.Supp.2d 628, 667 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 691 (S.D.N.Y.2004) (quoting Statement of the Commission Regarding Disclosure of Year 2000 Issues and Consequences by Public Com panies, Investment Advisers, Investment Companies, and Municipal Securities Issuers, SEC Release No. 7558, 1998 WL 425894 , at *14 (July 29, 1998)).

Litig., 346 F.Supp.2d 628, 690 (S.D.N.Y.2004) (quoting Securities Offering Reform, SEC Release No. 8501, 2004 WL 2610458 , at *86).

Litig., 346 F.Supp.2d 628, 687 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 688 (S.D.N.Y. 2004). 6 Here, the Registration Statements gave no indication that the NRC had consistently rejected the exact policy change sought by ES and was, allegedly, virtually certain to reject the change again.

Litig., 346 F.Supp.2d 628, 657 (S.D.N.Y. *379 2004) (quoting Gustafson, 513 U.S. at 581 , 115 S.Ct. 1061 ).

Litig., 346 F.Supp.2d 628, 660-61 (S.D.N.Y.2004) (underwriters can be liable for false and misleading public filings made by issuer and accountants that were incorporated into registration statement).

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 689 (S.D.N.Y.2004) (“[N]on-disclosure of an underwriter *160 or issuer’s conflicts of interest can constitute material omissions, even where no regulation expressly compels the disclosure of such conflicts.”).

Litig., 346 F.Supp.2d 628, 689 (S.D.N.Y.2004) ("Information regarding relationships that undermine the independence of an underwriter’s judgment about the quality of the investment can be material to an investor.

Lit., 346 F.Supp.2d 628, 659 (S.D.N.Y.2004) (“To be liable as a seller, the defendant must be the “buyer’s immediate seller; remote purchasers are precluded from bringing actions against remote sellers.”); In re Royal Ahold N.V.

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004) (quoting The Regulation of Securities Offerings, Securities Act Release No. 7606A, 63 Fed.

Litig., 346 F.Supp.2d 628, 659 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 687 (S.D.N.Y.2004) (quoting Seibert v. Sperry Rand Corp., 586 F.2d 949, 952 (2d Cir.1978)).

Litig., 346 F.Supp.2d 628, 671-72 (S.D.N.Y.2004) (explaining that an underwriter would be entitled to rely on audited financial statements in the absence of red flags); Cromer Fin.

Litig., 346 F.Supp.2d 628, 662-63 (S.D.N.Y.2004); Sanders v. John Nuveen & Co., 524 F.2d 1064, 1070 (7th Cir.1975). *652 Moreover, this opinion has discussed supra the clear trend in the Supreme Court in Central Bank and Stoneridge, inter alia, buttressed by public policy explanations, to narrow the scope of judicially implied causes of private securities actions under § 10(b) and Rule 10b-5, in particular where the statute or regulation does not contain such language and/or…

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004) (quoting The Regulation of Securities Offerings, Securities Act Release No. 7606A, 63 Fed.

The underwriters argued that there was “no dispute that they acted reasonably.” Id. at 661.

See Laven v. Flanagan, 695 F.Supp. 800, 812 (D.N.J.1988); Feit v. Leasco Data Processing Equipment Corp., 332 F.Supp. 544, 577 (E.D.N.Y.1971) (“What constitutes ‘reasonable investigation’ and ‘a reasonable ground to believe’ will vary with the degree of involvement of the individual, his expertise, and his access to the pertinent information and data.”) quoted in In re WorldCom, Inc., 346 F.Supp.2d 628, 675 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 696-97 (S.D.N.Y.2004), Item 504 of Regulation S-K only requires that a registration statement disclose the “principal purposes for which the net proceeds to the registrant from the securities to be offered are intended to be used and the approximate amount intended to be used for each such purpose.” Id. (quoting 17 C.F.R. § 229.504 ).

Rather, plaintiffs must plead “facts which come to a defendant’s attention that would place a reasonable party in defendant’s position on notice that the audited company was engaged in wrongdoing to the detriment of its investors.” In re WorldCom, 346 F.Supp.2d 628, 672 (S.D.N.Y.2004) (internal quotation marks and citation omitted); see also In re Leslie Fay Cos.

Litig., 346 F.Supp.2d 628, 672 (S.D.N.Y.2004) (stating that “in an attempt to demonstrate recklessness, plaintiffs in Section 10(b) cases often assert that a defendant ignored ‘red warning flags’ of another actor’s wrongdoing”) (citing Chill, 101 F.3d at 269 13 ); In re Philip Servs.

Litig., 346 F.Supp.2d 628, 672 (S.D.N.Y.2004) (stating that “in an attempt to demonstrate recklessness, plaintiffs in Section 10(b) cases often assert that a defendant ignored ‘red warning flags’ of another actor’s wrongdoing”) (citing Chill, 101 F.3d at 269; 7 In re Philip Servs.

Litig., 346 F.Supp.2d 628, 678-81 (S.D.N.Y.2004).

Litig., 346 F.Supp.2d 628, 674 (S.D.N.Y.2004) (noting the continued relevance of the Escott decision in interpreting the due diligence defense to liability under Section 11).

Litig., 346 F.Supp.2d at 658-59, 662-63 .

Litig., 346 F.Supp.2d 628, 662 (S.D.N.Y.2004) (quoting The Regulation of Securities Offerings, Securities Act Release No. 7606A, 63 Fed.

See In re WorldCom, 346 F. Supp. 2d at 691–92 (denying summary judgment where offering documents referenced competition generally, rather than 30 details of company’s indebtedness, lack of cash flow, and underperforming stock).

See SEC Release No. 8591, 2005 WL 1692642 , at *79 (Aug. 3, 2005) (“We believe, however, as we have stated previously, that the standard of care under Section 12(a)(2) is less demanding than that prescribed by Section 11 or, put another way, that Section 11 requires a more diligent investigation than Section 12(a)(2).”). 10 Both before and since the SEC issued its interpretation, other court have held that a reasonable care due diligence defense under Section 12(a)(2) “is le…