FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

In re: SORRENTO 

THERAPEUTICS, INC. 

SECURITIES LITIGATION, 

________________________________ 

ANDREW R. ZENOFF, Lead 

Plaintiff, individually and on behalf of 

all others similarly situated, 

Plaintiff-Appellant, 

 v. 

SORRENTO THERAPEUTICS, INC.; 

HENRY JI; MARK R. BRUNSWICK, 

Defendants-Appellees.

No. 22-55641 

D.C. Nos. 

3:20-cv-00966-

AJB-DEB 

3:20-cv-01066-

AJB-DEB 

3:21-cv-01331-

AJB-DEB 

OPINION

Appeal from the United States District Court

for the Southern District of California

Anthony J. Battaglia, District Judge, Presiding

Argued and Submitted February 14, 2024

Pasadena, California

Filed March 25, 2024
2 ZENOFF V. SORRENTO THERAPEUTICS, INC. 

Before: Richard C. Tallman and Consuelo M. Callahan, 

Circuit Judges, and Robert S. Lasnik,* District Judge.

Opinion by Judge Callahan 

SUMMARY**

Securities Fraud

The panel affirmed the district court’s dismissal, for 

failure to state a claim, of an action alleging violations of the 

Securities Exchange Act and the Securities and Exchange 

Commission’s Rule 10b-5 when Sorrento Therapeutics, Inc., 

its chief executive officer, and its vice president announced 

that Sorrento might have discovered a “cure” for COVID19. 

The panel held that, in context, defendants’ 

representations in a press release, a Fox News article, and a 

BioSpace.com article were not materially false or 

misleading. 

The panel also held that the allegations in plaintiff’s 

class-action complaint did not support the requisite strong 

inference of scienter in defendants’ intent to improperly 

manipulate the price of Sorrento’s shares. 

* The Honorable Robert S. Lasnik, United States District Judge for the 

Western District of Washington, sitting by designation.

** This summary constitutes no part of the opinion of the court. It has 

been prepared by court staff for the convenience of the reader.
ZENOFF V. SORRENTO THERAPEUTICS, INC. 3 

COUNSEL

Steven F. Hubachek (argued), Trig R. Smith, and Nicole Q. 

Gilliland, Robbins Geller Rudman & Dowd LLP, San Diego, 

California; for Plaintiff-Appellant. 

Edward Han (argued), Sean D. Unger, and Austin M. Prouty, 

Paul Hastings LLP, Palo Alto, California; Timothy D. 

Reynolds, Paul Hastings LLP, Los Angeles, California; for 

Defendants-Appellees. 

OPINION

CALLAHAN, Circuit Judge:

When on May 15, 2020, Sorrento Therapeutics, Inc. 

(“Sorrento”) announced that it might have discovered a 

“cure” for COVID-19, the price of its stock rose 

precipitously but then declined a week later following 

further explanations of Sorrento’s discovery. Andrew R. 

Zenoff (“Zenoff”), individually, and on behalf of other 

similarly situated individuals who purchased Sorrento 

common stock between May 15 and May 21, 2020, 

commenced this action alleging violations of the Exchange 

Act and the Securities and Exchange Commission’s Rule 

10b-5 by Sorrento, its Chief Executive Officer (Henry Ji), 

and its Vice President (Mark Brunswick) (referred to 

collectively as the “Defendants”). The district court granted 

Defendants’ motion to dismiss pursuant to Federal Rule of 

Civil Procedure 12(b)(6) finding that Zenoff had failed to 

make plausible showings of falsity or scienter. We affirm 

because, in context, Defendants’ representations were not 
4 ZENOFF V. SORRENTO THERAPEUTICS, INC.

false, and Zenoff’s pleadings do not support the requisite 

strong inference of scienter.

I

Sorrento is a clinical-stage biopharmaceutical company 

based in San Diego, California, that researches and develops 

treatments for cancer, pain, and COVID-19. On May 15, 

2020, at the height of the COVID-19 pandemic, Sorrento 

announced a promising development of a COVID-19 

antibody, STI-1499. This litigation arises from three 

particular documents released that day: (1) Sorrento’s press 

release entitled “STI-1499, A Potent Anti-SARS-COV-2 

Antibody Demonstrates Ability to Completely Inhibit In 

Vitro Virus Infection In Preclinical Studies” (the “May 15 

Press Release”); (2) a Fox News article entitled “California 

biopharmaceutical company claims coronavirus antibody 

breakthrough” (the “Fox News article”); and (3) a 

BioSpace.com article entitled “Sorrento IDS Antibody 

Against COVID-19 That Appears 100% Effective” (the 

“May 15 BioSpace article”). 

Within a week, several articles were published 

questioning the importance of Sorrento’s development. 

Among these were (1) a May 20 Yahoo!Finance interview 

entitled “Sorrento Therapeutics CEO [Henry Ji] on focusing 

on ‘the real deal’ antibody test rather than stock 

performance”; (2) a May 20 Hindenburg Research article 

entitled “Sorrento’s Pandemic Profiteering: Experts and 

Former Employees Speak Out on Sensational Claims of 

Covid-19 Cure”;1 (3) a May 20 Viceroy Research article 

1 Hindenburg Research and Viceroy Research held “short” positions 

against Sorrento, which means they would profit from a decline in 

Sorrento’s stock price. 
ZENOFF V. SORRENTO THERAPEUTICS, INC. 5

entitled “Sorrento’s Predatory Propaganda”; and (4) a May 

22 BioSpace.com article entitled “Sorrento Responds to 

Criticism of COVID-19 Neutralizing Antibodies.”

Sorrento’s stock prices responded to these 

announcements and articles. On May 15, following the 

initial announcement, Sorrento’s stock price increased to a 

daily high of $9.00 per share—or 243.5% higher than the 

prior trading day’s close of $2.62—and its common stock 

traded hands at nearly seventy-eight times its daily volume. 

Following the May 20 articles, Sorrento’s stock price 

dropped from $6.82 per share to $4.55 per share. After 

Defendant Ji’s interview on Yahoo!Finance, the price 

increased to $5.70, but then dropped to $4.67 per share 

following the May 22 BioSpace.com article.

Meanwhile, Sorrento was experiencing some financial 

difficulties. In March 2020, Sorrento’s independent auditor 

had issued a “going concern” qualification to its 2019 audit 

opinion noting Sorrento’s high cash burn rate and overleveraged capital structure. In its 2019 Form 10-K filed with 

the Securities and Exchange Commission (“SEC”), Sorrento 

had indicated that if it could not raise sufficient financing for 

its day-to-day operations, it would have to shut down. This 

condition was in part the result of Oak Tree Capital 

Management, L.P. (“Oaktree,” Sorrento’s high-interest debt 

holder) requiring Sorrento to raise certain amounts of outside 

capital and repay debts in 2020. 

The district court noted that in response to its financial 

situation, Sorrento: (1) on March 13, 2020, filed a shelfregistration statement with the SEC, authorizing Sorrento to 

sell up to $1 billion in securities; (2) on April 27, 2020, 

entered into a sales agreement with Alliance Global Partners, 

authorizing it to sell up to $250 million of Sorrento’s stock 
6 ZENOFF V. SORRENTO THERAPEUTICS, INC.

in at-the-market (“ATM”) offerings; and (3) simultaneously 

issued a prospectus stating it was offering up to 250 million 

shares of its common stock to Arnaki Ltd. (“Arnaki”) 

pursuant to a purchase agreement. The district court further 

noted that under this agreement, “Sorrento could direct 

Arnaki to purchase up to 650,000 shares of Sorrento’s 

common stock per business day, and the purchase price was 

equal to 97.5% of the daily volume weighted average 

purchase price of the common stock on the purchase date.” 

The court observed that during the second quarter of 2020, 

Sorrento “raised over $67 million in ATM common stock 

offerings and used these proceeds to retire the unpaid 

balance of the Oaktree loan.”

On May 26, 2020, Zenoff filed this securities fraud classaction complaint against the Defendants. The proposed class 

consisted of all purchasers of Sorrento common stock 

between May 15 and May 21, 2020, and the complaint 

alleged violations of §§ 10(b) and 20(a) of the Exchange Act 

(15 U.S.C. §§ 78j(b) and 78t(a)), and SEC Rule 10b-5 (17 

C.F.R. § 240.10b-5). Related actions were filed, and on 

February 21, 2021, the district court consolidated the 

actions, appointed Zenoff as lead plaintiff, and approved his 

choice of lead counsel. On November 30, 2021, Zenoff filed 

a “First Amended Consolidated Class Action” complaint 

(“FAC”). The gravamen of the FAC was that Sorrento had 

falsely claimed to have developed a cure for COVID-19, 

misleading investors. It emphasized CEO Ji’s statements in 

media articles on May 15 that: “We want to emphasize there 

is a cure. There is a solution that works 100 percent,” and “if 

we have the neutralizing antibody in your body, you don’t 

need the social distancing. You can open up a society 

without fear.”
ZENOFF V. SORRENTO THERAPEUTICS, INC. 7

II

On April 11, 2022, the district court granted Sorrento’s 

motion to dismiss the FAC.2

Addressing Zenoff’s claims of materially false and 

misleading statements, the district court noted that Zenoff’s 

claims were based on three particular statements, and 

rejected Zenoff’s argument that Defendants had misled 

investors through these statements.3 The district court found 

the assertion of a cure and a solution that works 100% to be 

“a statement of corporate optimism”—in other words, mere 

2 The district court granted Sorrento’s motion to take judicial notice of 

the various articles concerning STI-1499 and Sorrento’s SEC filing. On 

appeal, Zenoff does not challenge the taking of judicial notice.

3 Zenoff relied on:

(1) CEO Ji’s May 15 statement to Fox News: “We 

want to emphasize there is a cure. There is a solution 

that works 100 percent . . . . If we have the neutralizing 

antibody in your body, you don’t need the social 

distancing. You can open up a society without fear.” 

(2) VP Brunswick’s May 15 statement to Fox News: 

“As soon as it is infused, that patient is now immune 

to the disease . . . . For the length of time, the antibody 

is in that system. So, if we were approved [by the 

FDA] today, everyone who gets that antibody can go 

back to work and have no fear of catching COVID19.”

(3) the May 15 BioSpace article’s quote of CEO Ji 

stating: “One of the antibodies is so powerful that at a 

very low concentration it is able to 100% completely 

prevent infection or inhibit the infection . . . . So what 

we’ve done is identified an antibody that recognizes 

the COVID-19 virus and completely inhibits its 

binding to the specific receptor.” 
8 ZENOFF V. SORRENTO THERAPEUTICS, INC.

“puffery” which “cannot state an actionable material 

misstatement of fact under federal securities law.” See Glen 

Holly Ent. Inc. v. Tektronix, Inc., 352 F.3d 367, 379 (9th Cir. 

2003). The court further found that there was “nothing about 

the representation of STI-1499’s success that is inaccurate or 

misleading.” It noted that on May 15, VP Brunswick was 

quoted in the Fox News article as saying, “[w]e anticipate 

having enough material to start a Phase I trial in patients in 

the ICU within two months”; that the May 20 

Yahoo!Finance article reported that Sorrento had found an 

antibody “in a preclinical trial”; and the May 15 Fox News 

article noted that “a quick approval from the [Federal Drug 

Administration (“FDA”)] would be needed to make the 

antibody treatment available within months.” The district 

court concluded that “[i]n reviewing each of these statements 

within the context of each entire article, [Zenoff has not] 

sufficiently pled the existence of false or misleading 

statements.”

The district court next considered scienter, another 

essential element of a § 10(b) claim. See Lipton v. 

Pathogenesis Corp., 284 F.3d 1027, 1034 (9th Cir. 2002). 

Scienter is the intent to deceive, manipulate or defraud. 

Tellabs, Inc. v. Makor Issues & Rts., Ltd., 551 U.S. 308, 319 

(2007). To plead scienter for security fraud a complaint 

must “state with particularity facts giving rise to a strong 

inference that the defendant acted with the required state of 

mind.” 15 U.S.C. § 78u–4(b)(2). “A complaint will 

survive . . . only if a reasonable person would deem the 

inference of scienter cogent and at least as compelling as any 

opposing inference one could draw from the facts alleged.” 

Tellabs, Inc., 551 U.S. at 324. 

The district court determined that Zenoff had failed to 

establish a strong inference of scienter. Zenoff asserted 
ZENOFF V. SORRENTO THERAPEUTICS, INC. 9

scienter based on allegations that: (1) the pandemic 

represented a huge financial opportunity for Sorrento; (2) the 

individual defendants had access to and knowledge of the 

real-time data relating to STI-1499; (3) Sorrento needed to 

raise capital to fund its operations; (4) Sorrento had an 

ongoing ATM stock offering to fund its continued 

operations; (5) Sorrento had a purchase agreement with 

Arnaki; and (6) Sorrento needed to eliminate its high-interest 

debt.

The district court was not persuaded. First, it found that 

Sorrento’s need to raise funds to retire its high-interest debt 

did not give rise to a strong inference of scienter. See Mallen 

v. Alphatec Holdings, Inc., 861 F. Supp. 2d 1111, 1137 (S.D. 

Cal. 2012) (holding that generalized assertions of motive 

based on potential profit are insufficient to meet the 

heightened pleading requirement of scienter). Second, the 

court noted that the FAC did not sufficiently allege any 

contemporaneous statements by the Defendants showing 

“their knowledge of purported falsity.” Finally, the district 

court concluded that even upon a holistic review of all 

scienter allegations, Zenoff had not adequately alleged a 

strong inference of scienter in part because the facts that STI1499 was still in preclinical stages and had not yet received 

FDA approval was disclosed contemporaneously with the 

announcement of the development of STI-1499.

The district court granted the motion to dismiss with 

leave to amend. Zenoff, however, declined to amend the 

complaint. Judgment was entered on June 3, 2022, and 

Zenoff timely appealed on June 30, 2022.

III

A Rule 10b-5 claim requires that plaintiff prove ‘“(1) a 

material misrepresentation or omission by the defendant; 
10 ZENOFF V. SORRENTO THERAPEUTICS, INC.

(2) scienter; (3) a connection between the misrepresentation 

or omission and the purchase or sale of a security; 

(4) reliance upon the misrepresentation or omission; 

(5) economic loss; and (6) loss causation.”’ Mattrixx 

Initiatives, Inc. v. Siracusano, 563 U.S. 27, 37–38 (2011) 

(quoting Stoneridge Inv. Partners, LLC v. Scientific–

Atlanta, Inc., 552 U.S. 148, 157 (2008)). Both falsity and 

scienter must be alleged with particularity. Zucco Partners, 

LLC v. Digimarc Corp., 552 F.3d 981, 990 (9th Cir. 2009). 

Thus, for falsity, a plaintiff must allege with particularity 

each statement alleged to be misleading and the reasons why 

it is misleading. See In re Rigel Pharm., Inc. Sec. Litig., 697 

F.3d 869, 877 (9th Cir. 2012). For scienter, a plaintiff must 

“state with particularity facts giving rise to a strong inference 

that the defendant acted with the required state of mind.” 

Zucco, 552 F.3d at 991(quoting 15 U.S.C. § 78u–4(b)(1)). 

The inference must be “cogent and compelling, thus strong 

in light of other explanations.” Tellabs, 551 U.S. at 324. “A 

complaint will survive . . . only if a reasonable person would 

deem the inference of scienter cogent and at least as 

compelling as any opposing inference one could draw from 

the facts alleged.” Id.

Pursuant to Rule 12(b)(6), a complaint can be dismissed 

for: “(1) lack of cognizable legal theory or (2) insufficient 

facts under a cognizable legal claim.” SmileCare Dental 

Grp. v. Delta Dental Plan of Cal., Inc., 88 F.3d 780, 783 (9th 

Cir. 1996). When the complaint includes allegations of 

fraud, a party must “state with particularity the 

circumstances constituting fraud or mistake,” although 

“[m]alice, intent, knowledge, and other conditions of a 

person’s mind may be alleged generally.” Fed. R. Civ. P. 

9(b). Furthermore, claims under the Exchange Act are 

subject to the provisions of the Private Securities Litigation 
ZENOFF V. SORRENTO THERAPEUTICS, INC. 11

Reform Act of 1995 (“PSLRA”), which “requires that a 

complaint alleging misleading statements or omissions 

‘specify each statement alleged to have been misleading, the 

reason or reasons why the statement is misleading, and, if an 

allegation regarding the statement or omission is made on 

information and belief, . . . all facts on which that belief is 

formed.’” Reese v. BP Expl. (Alaska) Inc., 643 F.3d 681, 

690 (9th Cir. 2011) (quoting 15 U.S.C. § 78u‒4(b)(1)). 

We review Rule 12(b)(6) dismissals de novo. Chavez v. 

Robinson, 12 F.4th 978, 985 (9th Cir. 2021). We may 

consider “the face of the complaint, materials incorporated 

into the complaint by reference, and matters of which we 

may take judicial notice.” Zucco, 552 F.3d at 989.

IV

A. Falsity

Zenoff contends that Sorrento “told the world multiple 

whoppers” concerning a 100% cure for COVID-19. While 

Defendants’ enthusiasm for STI-1499 might have been 

overblown, in context, their statements were not materially 

misleading. The May 15 Press Release starts with the 

statement that its antibody “demonstrated 100% inhibition 

of SARS-CoV-2 virus infection in an in vitro virus infection 

experiment at a very low antibody concentration.” 

(Emphasis added). The Fox News article’s headline is 

“California biopharmaceutical company claims coronavirus 

antibody breakthrough” and it has a subsection in bold print 

entitled “possible coronavirus vaccine enters human testing 

trial.” The article further states that Sorrento has partnered 

with Mount Sinai Healthcare System to develop an antibody 

cocktail, that STI-1499 is likely to be the first antibody in the 

cocktail, and that Sorrento “can provide up to 200,000 doses 

per month.” The May 15 BioSpace article commences with 
12 ZENOFF V. SORRENTO THERAPEUTICS, INC.

the statement that Sorrento is “one of the companies deeply 

involved in clinical antibody development against COVID19.” The article states that Sorrento is teaming with Mount 

Sinai to develop an antibody cocktail, and notes that “if the 

Phase 1 trial starts by the beginning of July, they will know 

withing a week or two whether the antibody is having an 

effect.” 

A fair reading of the press release and the articles reveals 

that there was no promise of an immediate 100% cure. 

Despite Defendants’ enthusiasm about STI-1499, in context, 

all of the articles reveal that its development was at the stage 

of an in vitro virus infection experiment, i.e., it had only been 

tested in a laboratory. Zenoff has not shown that a 

reasonable person reading the articles would think that 

Defendants were representing that STI-1499, without further 

testing, was an immediate cure for COVID-19.

Moreover, the only basis that Zenoff offers to support his 

claim that Defendants’ representations were knowingly false 

is that there is still no cure for COVID-19. He does not 

address whether, in May 2020, STI-1499 showed some 

promise as a cure for COVID-19. Rather, he reasons from 

the fact that there still is no cure for COVID-19, that 

Defendants could not, in good faith, have thought that STI1499 was a cure. However, many initially promising 

discoveries do not survive the testing required for FDA 

approval; failure to survive testing is hardly evidence that the 

developer’s initial enthusiasm was unwarranted or 

inherently false at the time.

B. Scienter

Even if the Defendants’ statements could be construed to 

be misleading, Zenoff would still not be entitled to relief 

unless his allegations raised the requisite strong inference of 
ZENOFF V. SORRENTO THERAPEUTICS, INC. 13

scienter. On appeal, Zenoff argues that he has made the 

requisite showing through the combination of: (1) Ji’s and 

Brunswick’s management roles; (2) Ji’s and Brunswick’s 

undisputed access to STI-1499 data; (3) “the blatant falsity 

of Defendants’ statements”; (4) “the extremely short time 

period between Defendants’ false statements and their 

admission of falsity”; and (5) “Sorrento’s dire financial 

situation.”

Certainly, Ji and Brunswick had management roles and 

access to STI-1499 data, but there is no indication or 

allegation that those roles gave them access to some 

information about STI-1499 that was not mentioned in the 

press release or the articles. In contrast, the cases cited by 

Zenoff concern situations where senior executives were 

alleged to have inside information that was not available to 

others.4 Here, Defendants were forthright in stating that 

STI-1499 was at the in vitro experiment stage. Zenoff does 

not suggest or allude to what other relevant information 

Defendants had about STI-1499 that should have been 

disclosed.

As previously noted, Zenoff’s claim of “blatant falsity” 

does not survive scrutiny. When viewed in context, 

Defendants did not promise an immediate 100% cure to 

COVID-19. Moreover, Defendants only “admitted falsity” 

4 For example, South Ferry LP, No. 2 v. Killinger, 542 F.3d 776 (9th Cir. 

2008), concerned statements by high-ranking corporate officers as to 

core corporate operations, including claims that the corporation “had 

fully integrated the information systems that are central to WAMU’s 

ability to maintain and update their various hedges.” Id. at 781. In re 

Alphabet, Inc. Sec. Litig., 1 F.4th 687 (9th Cir. 2021), concerned 

allegations that the defendants made materially misleading statements by 

failing to disclose security problems. Both cases concerned critical 

information that was known only to corporate insiders. 
14 ZENOFF V. SORRENTO THERAPEUTICS, INC.

if their initial assertions are read as claiming an immediate 

100% cure. The May 20 Yahoo!Finance interview reiterates 

the prerequisite of clinical testing and asserts that Sorrento, 

“instead of watching the stock going up or going down,” is 

“focusing on mak[ing] sure we have the real deal.” The May 

22 BioSpace.com article reported that CEO Ji did not say 

STI-1499 was a cure. It reported that he stated that “if it gets 

through safety studies, if it demonstrates efficacy, it 

potentially is a cure—if you have the antibody in the blood 

and it prevents infection.” The May 20 and May 22 articles 

can only be read as retractions if Defendants’ prior 

statements are interpreted—contrary to Sorrento’s 

protestations—as a promise of an immediate 100% solution. 

The more reasonable interpretation is that the later 

statements are consistent elaborations of what was initially 

stated.5

Next, although Sorrento’s financial situation was clearly 

helped by the market’s response to the announcement of the 

development of STI-1499, Sorrento had taken steps to meet 

its “dire financial situation” well before the announcements 

of STI-1499. It seems likely that the bump in the price of 

Sorrento’s stock in the week of May 15 provided it with 

more revenue from its agreement with Anarki to purchase 

stock, but Zenoff does not allege any particular improper or 

inflated sales. Indeed, as Defendants note, Zenoff identifies 

no individual stock sales at all. Accordingly, Zenoff has not 

made the requisite showing of trading history necessary to 

raise an inference of scienter. See Zucco, 552 F.3d at 1005 

5 Zenoff cites a couple of cases for the proposition that temporal 

proximity between a fraudulent statement and a later disclosure can be 

circumstantial evidence of scienter. But this is so only if the first 

statement is fraudulent.
ZENOFF V. SORRENTO THERAPEUTICS, INC. 15

(holding that “for individual defendants’ stock sales to raise 

an inference of scienter, plaintiffs must provide a 

‘meaningful trading history’ for purposes of comparison to 

the stock sales within the class period,” and that “[e]ven if 

the defendant’s trading history is simply not available, for 

reasons beyond a plaintiff’s control, the plaintiff is not 

excused from pleading the relevant history”). 

Zenoff has not pled any allegations giving rise to the 

requisite strong inference that Defendants intended to 

improperly manipulate the price of Sorrento’s shares. At 

best, we can infer that Defendants’ excitement about the 

development of STI-1499 (and the public’s excitement) 

produced a one-week bump in the price of Sorrento’s stock. 

This may well have helped Sorrento’s efforts to raise capital, 

but as Zenoff has failed to point to any particular sales or 

purchases by Sorrento or its officers, there is no inference of 

intent to manipulate. We have held that “[a] court must 

compare the malicious and innocent inferences cognizable 

from the facts pled in the complaint, and only allow the 

complaint to survive a motion to dismiss if the malicious 

inference is at least as compelling as any opposing innocent 

inference.” Zucco, 552 F.3d at 991. Zenoff has not shown 

that Sorrento’s promotion of its development of STI-1499 

created a strong inference that Sorrento intended to 

manipulate the price of its stock.

V

The record shows that as a result of Defendants’ 

enthusiastic announcement of the development of STI-1499 

as a possible cure for COVID-19, the price of Sorrento’s 

stock rose sharply for about a week. Zenoff filed this lawsuit 

asserting both that Sorrento falsely claimed that STI-1499 

was a 100% cure for COVID-19 and did so with the intent 
16 ZENOFF V. SORRENTO THERAPEUTICS, INC.

to manipulate the price of its stock. However, the PSLRA 

requires that Zenoff allege both falsity and scienter with 

particularity. On this record, Zenoff has not adequately pled 

that Defendants’ statements about STI-1499, when viewed 

in context, were false as opposed to overstated. 

Furthermore, even if the allegations of falsity were deemed 

plausible, Zenoff has failed to plead factual allegations that 

give rise to a strong inference of scienter. He does not allege 

any particular stock sales or purchases by Sorrento or either 

of the individual defendants. Indeed, in the spring of 2020, 

the possibility of a cure for COVID-19 generated many 

innocent explanations for Defendants’ statements and the 

market’s reaction to those statements. The district court’s 

dismissal of Zenoff’s First Amended Complaint is 

AFFIRMED.