FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

ANDREW E. ROTH, 

Plaintiff-Appellee /

Cross-Appellant,

 v. 

FORIS VENTURES, LLC; VALLEJO 

VENTURES TRUST U/T/A 2/12/96; 

L. JOHN DOERR; ANN DOERR; 

AMYRIS, INC., 

Defendants-Appellants /

Cross-Appellees.

Nos. 22-16632 

22-16633

D.C. No. 4:21-cv04288-YGR 

OPINION

Appeal from the United States District Court

for the Northern District of California

Yvonne Gonzalez Rogers, District Judge, Presiding

Argued and Submitted July 17, 2023

San Francisco, California

Filed November 13, 2023

Before: KIM MCLANE WARDLAW and MILAN D. 

SMITH, JR., Circuit Judges, and DOUGLAS L. RAYES,

*

District Judge.

* The Honorable Douglas L. Rayes, United States District Judge for the 

District of Arizona, sitting by designation.
2 ROTH V. FORIS VENTURES, LLC

Opinion by Judge Milan D. Smith, Jr.

SUMMARY**

Securities Law

The panel affirmed in part and reversed in part the 

district court’s order denying defendants’ motion to dismiss 

a derivative action brought by a shareholder of Amyris, Inc., 

under § 16(b) of the Securities Exchange Act of 1934, which 

imposes liability for sales and purchases of securities 

between an issuer of securities and a beneficial owner, 

director, or officer of that issuer that occur within six months 

of each other and realize a profit.

Securities and Exchange Rule 16b-3(d)(1) exempts from 

liability under § 16(b) transactions between an issuer and a 

director where the issuer’s board approves the 

transaction. Agreeing with the Second Circuit, the panel 

held that Rule 16b-3(d)(1) does not require the board of 

directors to approve a transaction for the specific purpose of 

exempting it from liability.

The panel held that the district court erred by imposing a 

purpose-specific approval requirement. However, the 

district court did not err in finding that the Amyris board was 

aware that defendant John Doerr had an indirect pecuniary 

interest in the challenged transactions when it approved 

them. The panel left it for the district court on remand to 

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

been prepared by court staff for the convenience of the reader.
ROTH V. FORIS VENTURES, LLC 3 

address whether defendant Foris Ventures, LLC, a beneficial 

owner of Amyris, was a director by deputation and thus 

eligible for the Rule 16b-3(d)(1) exemption.

COUNSEL

Michael D. Celio (argued), Jessica Valenzuela, Kevin J. 

White, and Paul J. Collins, Gibson Dunn & Crutcher LLP, 

Palo Alto, California; Jonathan A. Shapiro, Goodwin Procter 

LLP, San Francisco, California; Robert M. Tiefenbrun, 

Goodwin Procter LLP, Los Angeles, California; Grant P. 

Fondo, Goodwin Procter LLP, Redwood City; Daniel R. 

Adler, Gibson Dunn & Crutcher LLP, Los Angeles, 

California; for Defendant-Appellant. 

Glenn F. Ostrager (argued) and Joshua S. Broitman, 

Ostrager Chong Flaherty & Broitman PC, New York, New 

York; William F. Jonckheer and Robert C. Schubert, 

Schubert Jonckheer & Kolbe LLP, San Francisco, 

California; for Plaintiff-Appellee.

Kerry J. Dingle, Senior Appellate Counsel; Dominick V. 

Freda, Assistant General Counsel; Michael A. Conley, 

Solicitor; Securities & Exchange Commission, Washington 

D.C.; for Amicus Curiae Securities and Exchange 

Commission.
4 ROTH V. FORIS VENTURES, LLC

OPINION

M. SMITH, Circuit Judge:

Section 16(b) of the Securities Exchange Act of 1934 

imposes liability for sales and purchases of securities 

between an issuer of securities and a beneficial owner, 

director, or officer of that issuer that occur within six months 

of each other and realize a profit. 15 U.S.C. § 78p(b). The 

statute authorizes the Securities and Exchange Commission 

(SEC) to exempt certain transactions from liability pursuant 

to that section. Id. Pursuant to this authority, the SEC 

promulgated Rule 16b-3, which exempts transactions

between an issuer and a director where the issuer’s board 

approves the transaction. 17 C.F.R. § 240.16b-3(d)(1). 

The primary question presented in this appeal is whether 

Rule 16b-3 requires the board of directors to approve a

transaction for the specific purpose of exempting it from 

liability. We hold that it does not.

1

STATUTORY AND REGULATORY BACKGROUND

Section 16(b) provides, in relevant part:

For the purpose of preventing the unfair use 

of information which may have been 

1 This appeal has been held in abeyance as to Amyris since August 14, 

2023, due to the automatic stay imposed by 11 U.S.C. § 362. See Docket 

Entry No. 49. The Clerk will administratively close this appeal as to 

Amyris. No mandate will issue in connection with this administrative 

closure, and this opinion does not constitute a decision on the merits as 

to Amyris. Within 28 days after any change to the automatic stay’s effect 

in this appeal, any party may notify this court and move to reopen the 

appeal as to Amyris or for other appropriate relief.
ROTH V. FORIS VENTURES, LLC 5

obtained by such beneficial owner,2 director, 

or officer by reason of his relationship to the 

issuer, any profit realized by him from any 

purchase and sale, or any sale and purchase, 

of any equity security of such issuer (other 

than an exempted security) . . . within any 

period of less than six months . . . shall inure 

to and be recoverable by the issuer . . . .

15 U.S.C. § 78p(b). This allows securities issuers and their 

shareholders to file suit for disgorgement of profits from 

potentially exploitative transactions between the issuer and 

corporate insiders. Dreiling v. Am. Online, Inc., 578 F.3d 

995, 1001 (9th Cir. 2009). The provision imposes strict 

liability as a prophylactic rule against such abuse. Id. 

However, Congress also granted the SEC the authority 

to make rules exempting certain transactions from liability 

when strict application of Section 16(b) would not serve its 

intended purpose. 15 U.S.C. § 78p(b). Pursuant to this 

authority, the SEC promulgated Rule 16b-3, which exempts 

“[t]ransactions between an issuer and its officers or 

directors,” that are “approved by the board of directors of the 

issuer.” 17 C.F.R. § 240.16b-3(d)(1). As we have

recognized, the SEC exempted these transactions because 

they “‘do not appear to present the same opportunities for 

insider profit on the basis of non-public information as do 

market transactions by officers and directors.’” Dreiling v. 

Am. Online, Inc., 458 F.3d 942, 948 (9th Cir. 2006) (quoting 

Ownership Reports and Trading by Officers, Directors and 

Principal Security Holders, Exchange Act Release No. 34-

2 A “beneficial owner” is a person or entity that owns “more than 10 

percent of any class of any equity security.” 15 U.S.C. § 78p(a)(1). 
6 ROTH V. FORIS VENTURES, LLC

37260, 61 Fed. Reg. 30376-01, 1996 WL 324486, at *30377 

(June 14, 1996)).

FACTUAL AND PROCEDURAL BACKGROUND

Amyris is a publicly traded biotechnology company that 

operates out of California. John Doerr is a member of the 

Amyris board of directors. Doerr and his wife, Ann Doerr, 

are also trustees of Vallejo Ventures Trust (Vallejo), which 

is the member of Foris Ventures, LLC (Foris)—a private 

investment company that owns over 10% of Amyris

common stock and related derivative securities. Doerr 

indirectly owns all membership interests in Foris.

Foris and Amyris entered into several transactions 

involving Amyris stock, warrants, and debt between April 

2019 and January 2020.

3 The Amyris board of directors 

approved each of those transactions.

The following year, Andrew Roth, an Amyris 

shareholder, filed a derivative lawsuit on behalf of Amyris 

against the Doerrs, Foris, and Vallejo, alleging that those 

transactions violated Section 16(b) and seeking 

disgorgement of profits.4 Defendants moved to dismiss on 

the basis that, inter alia, the relevant transactions were 

exempt from Section 16(b) liability pursuant to Rule 16b-3

because they were approved by the Amyris board. The 

district court denied the motion. Relying on an SEC noaction letter, the district court first opined that Rule 16b-3’s 

3 The district court determined that Roth adequately pled that the 

transactions constituted purchases and sales pursuant to Section 16(b). 

No party challenges that finding on appeal. 

4 Roth also sued Barbara Hager, a special trustee of Vallejo and manager 

of Foris, but the claims against her were subsequently dismissed and are 

not at issue in this appeal.
ROTH V. FORIS VENTURES, LLC 7

exemption covers transactions in which a director has an 

indirect pecuniary interest, such as those between Amyris 

and Foris. See Am. Bar Assoc., 1999 WL 61837, at *2 (Feb. 

10, 1999). However, the district court held that these 

transactions were not exempt because the board did not 

approve the transactions for the specific purpose of 

exempting them under Rule 16b-3.

The district court subsequently granted a certificate of 

interlocutory appealability on the sole issue of whether Rule 

16b-3 requires a board of directors to explicitly approve 

transactions for the purpose of exempting them under the 

Rule. We granted Defendants’ petition to appeal (as well as

Roth’s petition to conditionally cross-appeal).

JURISDICTION AND STANDARD OF REVIEW

We have interlocutory jurisdiction pursuant to 28 U.S.C. 

§ 1292(b). This jurisdiction “permits [us] to address any 

issue fairly included within the certified order because it is 

the order that is appealable, and not the controlling question 

identified by the district court . . . .’” Deutsche Bank Nat. 

Trust Co. v. FDIC, 744 F.3d 1124, 1134 (9th Cir. 2014) 

(quoting Nevada v. Bank of Am. Corp., 672 F.3d 661, 673 

(9th Cir. 2012)). “We review a district court’s decision to 

grant or deny a motion to dismiss pursuant to Rule 12(b)(6) 

de novo.” Camacho v. Bridgeport Fin. Inc., 430 F.3d 1078, 

1079 (9th Cir. 2005); see also Drieling, 458 F.3d at 954 

(reviewing eligibility for Rule 16b-3 exemption to Section 

16(b) liability de novo).

ANALYSIS

I

Defendants challenge the district court’s holding that, for

Rule 16b-3(d) to apply, a board of directors must approve a 
8 ROTH V. FORIS VENTURES, LLC

transaction for the specific purpose of exempting it from 

Section 16(b) liability. This is the rare case where all parties 

involved agree that we must reverse. Both Roth and the 

SEC—which filed an amicus brief in this case—

acknowledge that Rule 16b-3 lacks a purpose-specific 

approval requirement. We agree. 

The district court derived its purpose-specific approval 

requirement from an SEC no-action letter stating that board 

must specify that its approval was “granted for purposes of 

making the transaction exempt under Rule 16b-3.” Am. Bar 

Assoc., 1999 WL 61837, at *2. However, courts generally 

do not defer to no-action letters. See Gryl v. Shire Pharms. 

Grp. PLC, 298 F.3d 136, 145 (2d Cir. 2002) (“SEC no-action 

letters constitute neither agency rule-making nor 

adjudication and thus are entitled to no deference beyond 

whatever persuasive value they might have.”); N.Y.C. 

Emps.’ Ret. Sys. v. SEC, 45 F.3d 7, 12, 14 (2d Cir. 1995) 

(explaining that SEC no-action letters “do not bind . . . the 

courts”). And, in any event, the SEC subsequently 

disavowed the purpose-specific approval requirement in 

amicus briefs filed before both the Second Circuit, see Brief 

of the Securities and Exchange Commission, Amicus 

Curiae, Gryl, 298 F.3d 136 (No. 01-9139), 2002 WL 

32625905, at *24, and our court in this case.

Rightly so. The text of Rule 16b-3 does not include a 

purpose-specific approval requirement. The Rule states, in 

relevant part, that “[a]ny transaction . . . involving an 

acquisition from the issuer . . . shall be exempt if . . . [t]he 

transaction is approved by the board of directors of the 

issuer.” 17 C.F.R. § 240.16b-3(d)(1). Simply put, nothing in 

the regulation indicates that the board must approve the 

transaction for the specific purpose of exempting it from 

Section 16(b) liability. 
ROTH V. FORIS VENTURES, LLC 9

When presented with this same issue, the Second Circuit

rejected the argument that Rule 16b-3(d) requires purposespecific approval of a transaction for the exemption to apply. 

Gryl, 298 F.3d at 144–45 (“We find wholly unpersuasive the 

artificial imposition of purpose-specific approval on the 

Board Approval Exemption . . . .”). In so doing, the court 

observed that “the text of the rule itself contains no 

suggestion that [a purpose-specific] requirement exists” and 

“mentions nothing about the subjective motivations of the 

approving body.” Id. at 145. Therefore, the court explained,

the requirements of the exemption are satisfied “[s]o long as 

the relevant securities transaction is between an issuer and 

insider, and so long as the terms and conditions of that 

transaction receive advance approval by the board of 

directors.” Id. at 145–46. We find this interpretation 

persuasive and hold that Rule 16b-3 does not include a 

purpose-specific approval requirement. 

II

Notwithstanding that Rule 16b-3 lacks a purposespecific approval requirement, Roth argues that this case 

should be remanded for two other reasons. First, Roth 

argues that remand is required to determine whether the 

Amyris board knew about and acknowledged Doerr’s 

pecuniary interest in the challenged transactions when 

approving them. But the district court explicitly found that 

the Amyris board evinced awareness of the existence and 

extent of Doerr’s indirect interest in the transactions. SEC 

regulations define “pecuniary interest” as “the opportunity, 

directly or indirectly, to profit or share in any profit derived 

from a transaction.” 17 C.F.R. § 240.16a-1(a)(2)(i). The 

complaint straightforwardly recognizes that “[Doerr]

indirectly owns all membership interests in [Foris.]” 

Furthermore, SEC filings show that the Amyris board 
10 ROTH V. FORIS VENTURES, LLC

considered Doerr’s indirect ownership of all of the 

membership interests in Foris when approving the 

transactions. Those filings also include Amyris shares

owned by Foris in calculating Doerr’s beneficial ownership

of the company. This is sufficient to establish the board’s

knowledge of Doerr’s indirect pecuniary interest in the 

challenged transactions. The district court did not err in so 

finding. 

Second, the parties dispute whether Rule 16b-3 exempts

Foris—a beneficial owner of Amyris—from Section 16(b) 

liability in the first place. Roth argues that because Section 

16(b) imposes liability for transactions between issuers and 

beneficial owners while Rule 16b-3(d) exempts transactions 

between issuers and directors or officers (but not beneficial 

owners), Foris is only eligible for the exemption if it can 

show that it is a “director by deputization.” “[A] corporation 

may be a virtual director, and thus an insider for purposes of 

§ 16(b) liability, by deputizing a natural person to perform 

its duties on the board.” Dreiling, 458 F.3d at 952 (citation 

omitted). Because companies may incur Section 16(b) 

liability as directors by deputization, our court has 

recognized that they may also invoke the Rule 16b-3(d) 

exemption where the board is aware of the deputization. Id. 

at 953–54. However, “[w]hether a company is a director by 

deputization is a question of fact to be settled case by case 

and not a conclusion of law.” Id. at 952 (quotation marks 

and citation omitted); see also Strom v. United States, 641 

F.3d 1051, 1060 (9th Cir. 2011) (“[T]he applicability of 

§ 16(b) often will turn on factual issues not appropriately 

resolved on a motion to dismiss.”). The district court 

determined that the complaint and the judicially noticed 

documents did not suffice to show that Foris was a director 

by deputization at the motion to dismiss stage. We agree and 
ROTH V. FORIS VENTURES, LLC 11

therefore remand the case to the district court for further 

proceedings to determine whether Foris was a director by 

deputization.

We do not now address the related issue of whether the 

challenged transactions are exempt under Rule 16b-3 

regardless of whether Foris is a director by deputization 

because Rule 16b-3(d) exempts entire transactions, rather 

than specific defendants, from Section 16(b) liability. This 

argument was never squarely addressed by the district court. 

“The matter of what questions may be taken up and resolved 

for the first time on appeal is one left primarily to the 

discretion of the courts of appeals.” Singleton v. Wulff, 428 

U.S. 106, 121 (1976). “As a federal court of appeals, we 

must always be mindful that we are a court of review, not 

first view.” Shirk v. United States ex rel. Dep’t of Interior, 

773 F.3d 999, 1007 (9th Cir. 2014) (quotations and citations 

omitted). Accordingly, we leave it to the district court to 

address this potentially dispositive issue in the first instance. 

See Detrich v. Ryan, 740 F.3d 1237, 1248–49 (9th Cir. 2013)

(en banc) (“A standard practice . . . is to remand to the district 

court for a decision in the first instance without requiring any 

special justification for so doing.”).

CONCLUSION

The district court erred by imposing a purpose-specific 

approval requirement in its Rule 16b-3(d) exemption 

analysis. However, contra Roth’s argument, it did not err in 

finding that the Amyris board was aware that Doerr had an 

indirect pecuniary interest in the challenged transactions

when it approved them. Finally, because the issue of 

whether Foris is a director by deputization is a question of 

fact, we remand the case, except as to Amyris, to the district 

court for further proceedings to determine whether Foris was 
12 ROTH V. FORIS VENTURES, LLC

a director by deputization. The appeal as to Amyris is closed 

for administrative purposes.

AFFIRMED IN PART AND REVERSED AND

REMANDED IN PART.

The parties shall bear their own costs.