the class action the securities fraud class action arises out of the alleged the defendant's alleged concealment of adverse clinical data internal study data and related protocol amendments the district court erred for four reasons primary reasons your honor first in finding that the protocol amendments were disclosed for purposes of the federal securities law the district court applied  the wrong standard a standard is it publicly accessible the appropriate legal standard to apply in the situation is were the facts known to reason reasonably available to investors and  for in order to determine that it's the defendant's burden to show that the information was conveyed to the public with a degree of intensity and credibility sufficient to counterbalance effectively any misleading defendants at mit at the end of the class period well there's two reasons at the end of the class three the defendants have admitted we adapted the wolverine study as we went along modifying the population in response to the data moreover we have a confidential source we cite in our complaint that specifically stated that defendant clover approved every single protocol amendment based on d n a enter under cases it requires motive and opportunity for money and i don't see any allegations of that here or errors with a release statements that are released so gross as to be and that is what the district court found was not adequately claim and as to the first which is very usual way of showing c n n or i don't see anything of that sort and that's really what i'd like to see because the others were reckless or any number of cases where we have held misstatements of short study data that said this drug was not affected and the underlying technology wasn't working yet they continue to make the same statements about the efficacy the stain sequence about the potential market throughout the entire class period  recklessness they had knowledge this this these protocol changes change the whole purpose of this trial this trial was supposed to be a third line therapy to treat patients who had failed other therapies they changed the entire protocol you are continuing to allegations the defendants realize they made all these amendments up through november twenty fifth teen the last amendment twenty feet twenty fifteen significantly change the protocol they judge the increase the healthiness of the  s because once they realized this in the fourth quarter we would show that they decrease spending they changed their strategy to start other projects were behind the scenes negotiating this this drug this new drug the only drug the company had was p m t to in order to continue operating they had to get this new drug in place and they continued to tell the investing public everything was going great until they got this drug in place three days later we're pulling the drug investors have said they're not giving us any more money but that's ok everyone we have a new  may if they had disclosed it beforehand they would likely not have gotten the contract for the drugs they couldn't show that they could persist successfully funded drug or bring a drug to market so when ordered to be able to get that contract they had to continue to conceal this information i have another set of question and this goes to the dismissal approach is did you ask two men and if you asked to the complaint did you come in then or now with them in this that would in some way your work was found to be wrong because you know at least the  was a judgement comes that it is at that point that the plaintiffs know what is wrong and they should be given a chance to cure what amendments well we didn't interrupt position to the motion to dismiss we weren't aware at that point in time what the court's perceived deficiencies work so well but once you did did you go back and say we would like to withdraw the dismissal with prejudice because we would like to make visa amendments which is what happened in lorelei and in lorillard we said you had a right to do that but i don't see court found it was an abuse of discretion not allowing the plaintiffs to men in the court specifically in all these cases a found that the plenty of didn't give reasons in our brief in our roof to your honor's here we listed two pages  identified that we would further explain the defendant's knowledge of the misleading facts to show that they knew that the drug was not the new the underlying technology didn't warrant the specific reasons the underlying technology works the morse precise timeline of what the defendants knew and when the substance of the meeting is the fact these were day long research meetings held in michigan discussing all of the clinical trials the defining clover knew that he was upset about it and he kept telling just figure out and   was more specifics about the contract and why the contract with to acquire a s one forty one show that they had motive and opportunity to conceal the data and till the contract was executed and then three days later disclose the information thank you i have a question i'm having trouble trouble figuring out the answer you saying correct me if i'm misunderstanding your a why is that information material because as i read the charts and perhaps i misread them these patients had positive responses to the drug  that trial the drug had been discontinued because of disease progression which is the instance of one of these patients or an adverse event so that goes to the overall perception of the trial isn't as effective as what they're leading people to believe your honor if you may please the court there is no compelling motive in this case the point of so i think waited until page fifty four of their opening brief to even discuss motive and judge angle meyer eloquently dispatched the mo argument about the the new drug that the company was acquiring they the company still disclose the failure of the study in two thousand and sixteen this all came out that enough so why is ninety five when the defend itself puts the information in the public domain that is sufficient it undercuts any inference hunter why is it cogent and compelling to infer seattle or the company is going public what does it mean to put it in the public bill may i mean you know if i publish something in an unknown journal that nobody reads is vet putting it in the public domain i'm doing something but really doing this is the clinical trials website that the government maintains it's the website it's the logical place that you would look in fact the plaintiffs themselves repeatedly cite here by the way said from the beginning that the protocols may need to be revised on page eight one five of the record so at the beginning the company disclosed that it might revise the protocols and there is no duty as a matter of law under ten b five to make affirmative statements or to disclose changes when the company says from the beginning that it may change the protocols silence absent a duty to disclose is not misleading and this company i beg to differ with counsel's characterization that they said everything was fine after the i p o actually the company expressly refrained from making any affirmative statements about the ongoing clinical trials going going well they ma statements as to the ongoing laboratory work going well they simply they simply said we're going to release the results mid two thousand and sixteen so they it's just like a company saying we're going to release the quarterly results in two weeks they don't have a duty to continuously disclose in piecemeal fashion changes that are made and those changes aren't in any way inconsistent with the purpose of the study is the company disclosed from the outset  the goal in these kinds of companies is to get to a phase three registration trial which is it's the final paper you turn in essentially to the f d a where they determine whether to approve the drug a phase one or a phase a pilot phase two study is simply an exploratory study as the company disclosed it was to decide how to design further studies and the company said in the prospectus that they were looking at both a second second line and third lin studies they disclosed specifically that on page eighty eight zero three and a eight seventy eight of the of the record they disclose that they intended to conduct a different study for  second line treatments page paragraph two zero six of the complete page eight ninety nine specifically discusses the company's disclosure about studying the possibility of a second line in addition to a third line treatment and as a district court found just by allowing some second line patients into the study it's not like they excluded all the third line patients they continue to look at second and third line patients in the study they explicitly told me and for us to your argument is that when you are engaged in studies of these sort even though the stork going negative and you change the protocol to see just how bad it is you don't have a duty at that stage to save it that is happening you shouldn't say everything is going grandly but you don't have a duty to say hey look out things are good that or at least that not saying that is not correct that's correct your honor on both counts but here it goes beyond that the plaintiffs have not pled particularize fact showing how the changes in the protocols actually rendered the statements materially misleading let alone so was repeatedly on able to validate the p n t two to five eighth's mechanisms of action in its internal studies that they knew infer from that that that the defendants committed securities fraud by hiding the fact from the market for another six months i mean that's the argument that's the plaintiffs argument and it's not it's legally incorrect because the defendants in this case did not come out and say we have continued to do additional research that validates the efficacy of the drug or that the study is going well no affirmative statement and that they did not make affirmative statements of the study is going  well silence is a legitimate option under the securities laws of this country other countries like canada for example have continuous disclosure regimes this country is not a continuous disclosure regime the plaintiffs don't make an argument that item three o three regulation s k for example requires disclosure and investors who look at these types of disclosures for clinical stage pharma companies they don't take the types of representations that are alleged here to be statements that the actual science going on right now is positive because it's understood that those types of results are released at periodic intervals and here the company said we're going to tell you know i mean if they didn't do that and treated during that time that would be a different thing because that would be motive and opportunity but that that's failure to come in  say hey things are going badly in this company does not constitute direct business we are a long way from that sort of motive an opportunity your honor and as this court said and counted when you don't have a compelling motive and when the case quote does not present facts indicate a clear duty to disclose point of c n n allegations do not provide strong evidence of conscious misbehavior or recklessness page one forty four of that opinion and that is exactly what judge angle meyer found in this case he went through in painstaking detail each of the alleged misstatements in this case and he compared them to the duty if any that the defendants had to make disclosure and he found an interesting way the ami care decision came out in two thousand and fifteen and that has still worked its way through the courts in terms of what needs to be disclosed in respect of a pinion statement from the law in the circuit was was frankly if anything more favorable to defendants on those sorts of issues just on the miss the material misrepresentation and omission side before ami care and judging correctly said there isn't a clear cut duty that makes it so inexcusable that the company didn't disclose in piecemeal fashion on its own public disclosures what the results of the of the study or the interim clinical results were it doesn't rise to that level of gross severe recklessness that the kalman this court held and counted the plaintiff has to satisfy in many many other cases as your honor noted have have likewise held this case simply does not involve any clear cut violation of a duty to disclose it does not involve any clearer material misrepresentations just to correct the record on the the pace i'm actually because i'll if you have any questions before i get to that case i'd be happy we grant why shouldn't the district court granted the sorry your honor the court granted dismissal because there was no c on or in this case the the plaintiff's allegations do not show any motive that's compelling enough to support a strong inference of ceann or there is no clear cut duty of disclosure that was violated in this case there were thirty nine pages of cautionary statements in the prospectus the company said from the beginning that there could be changes in the protocol in the protocols you have a serious outlines in her brief fifty seven fifty nine different  additional allegations that could be provided if she were allowed to and several was go for example to motive and opportunity several responses to that there are no additional allegations that change the character of this case the allegations about the other contract i mean there are already were allegations in this case that that that was a motive to defraud and the district court rejected that allegation all of the other allegations that are are suggested and not in great detail at the end of the plaintiff's brief they weren't presented to the district court and they don't change the fundamental defect that led to the dismissal there is no duty of actually say they dismiss with prejudice rather been doing what was done here which is dismissed with prejudice and then when the plaintiffs come in and say but we might have something say well that isn't really enough isn't just as a matter of procedure a better procedure to let people know what you are doing and then let them answer i think in this case your honor given that there was extensive briefing regarding the grounds for  dismissal given that the standards that we're talking about in this kind of case really are well saddled with respect to see especially with respect to ceann or and given that the plaintiffs had opportunities both before and after i might  this case that i'm rather troubled by the fact that district courts have continued to do this sort of thing even after very have been cases where we have suggested the opposite and i wonder whether it may not be necessary simply to reverse that something to get it across to district courts but this would be a better procedure  vote you know i asked what is it that you would do it i must say i didn't hear much yeah i mean i believe that this is not the case to make that determination because here there has i think what stitches together the cases that allow amendments is that there has to be some sign of life in the new in the new claims that are presented to the district court and certainly on appeal that give reasonable hope that these claims would pass muster and that just did not occur here the district court issued an incredibly thorough opinion and these kinds of cases this is it experimental cancer drug case where we want to encourage companies to invest in these types of technologies and by extending litigation through multiple rounds of motions to dismiss unnecessarily went when the allegations fall so far short of the line for c enter i think that has cost to it as well your honor and so i understand there are i think reasonable people can approach it in different ways but i think the interest of final extremely strong in this kind of case where the district court issued a seventy plus page opinion meticulously addressed the issues and the proposed new allegations were not presented below and they even here they're not presented in a form that gives any reasonable hope that they could change the outcome this is this question is not relevant to the determination of this appeal but since you raised it the canadian system  requiring continuing disclosures how does that work is it temporally based it on the basis of anytime there is something new it has to be disclosed  there's a materiality threshold i have canadian partners who can explain that in much better detail without getting themselves in trouble but it is hey patisserie there's a materiality threshold and it has to there's an analysis mean that if a company between reporting periods is stored in lose money there's a duty to come out in the middle of it in say hey we're not doing well as it depends that's my that's my  you're on the the pearl the protocol amendments to the purported risk disclosure my adversary is just speaking about a period one time in the prospectus buried in a paragraph that did not refer to any specific trial moreover that statement in and of itself was false because the wolverine trial protocol had already been revised so to warrant eight months into a trial and not even specific to that trial that the protocols might change when you've already changed them is faults and moreover you are the protocols were just explain that to me here with five tell you that i may have changed the protocol and you find out that a months after the fact i've changed the protocol how is my initial statement false that risk has already materialized it was a risk factor that this may happen that had already happened the protocol had been amended in december the for the first time then maybe my logic is not working well but that sounds like faulty logic i don't understand how this falls but they had the protocols were disclosed in the prospectus the protocols with an amended in august september october and november but you left out one thing which is that they also caution that the protocols may be subject to amend that you know you're on the that disclosure appeared one time in the prospectus after the trial was started it made no reference to the actual wolverine trial or any of the trials at issue in this case it made a reference that indicated in the future the protocols might be amended it was what you're really saying is that the that reference should have been more complete  that should have referred to specific trials yes for example in the case for example an evenly case the protocol was two stages and they specifically in the protocol it said if stage one shows thirty percent more efficacy then we may expand stage t it was specifically listed in the protocol reference to the specific trial at the outset not after the trial had begun down the road for eight months and that's the difference in addition the protocol that was disclosed in the prospectus they changed it repeatedly month after month the protocol changes materially change the entire patient population that were emitted into the trial because all the patients before that at least ten we know had dropped out from disease progression and or death the the protocols that the companies disclosed in their own company issued statements directly contradicted what was in the clinical trials website which is hundreds of pages of amendments so if that's not reckless are i don't know what is you consistently you change the whole purpose the whole patient population and you didn't tell anybody in fact you continue to maintain the same protocols throughout the class period as you were getting data that the pilot trial disease