United States Court of Appeals 

For the First Circuit 

No. 19-1614 

WANG YAN, 

Plaintiff, Appellant, 

JOANNE GELLER, 

Movant, Appellant, 

QIAN DENG; DAVID HERSHLIKOVITZ; JACKIE888, INC.; 

MICHAEL C. KEMMERLING; NARBEH NATHAN; PAUL SISLIN, individually 

and on behalf of all other similarly situated parties, 

Plaintiffs, 

v. 

REWALK ROBOTICS LTD.; LARRY JASINSKI; AMI KRAFT; AMIT GOFFER; 

JEFF DYKAN; HADAR RON; ASAF SHINAR; WAYNE B. WEISMAN; 

YASUSHI ICHIKI; ARYEH DAN; GLENN MUIR; BARCLAYS CAPITAL INC.; 

JEFFERIES LLC; CANACCORD GENUITY INC.; KEVIN HERSHBERGER, 

Defendants, Appellees. 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF MASSACHUSETTS 

[Hon. F. Dennis Saylor, IV, U.S. District Judge] 

Before 

Lynch, Stahl, and Kayatta, 

Circuit Judges. 

Omar Jafri, with whom Patrick V. Dahlstrom, Pomerantz LLP, 

Edward F. Haber, Adam M. Steward, and Shapiro Haber & Urmy LLP 
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were on brief, for appellants. 

Douglas P. Baumstein, with whom Susan L. Grace, White & Case 

LLP, Barry Sher, Anthony Antonelli, Paul Hastings LLP, David S. 

Godkin, James E. Kruzer, and Birnbaum & Godkin, LLP were on brief, 

for appellees. 

August 25, 2020 
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KAYATTA, Circuit Judge. On behalf of proposed classes 

of investors, Wang Yan alleged that ReWalk Robotics, Ltd. 

("ReWalk") violated both the Securities Act of 1933 ("Securities 

Act") and the Securities Exchange Act of 1934 ("Exchange Act") by 

misrepresenting and omitting details about its dealings with the 

FDA in its initial public offering (IPO) Registration Statement 

and in subsequent quarterly and annual disclosures. The district 

court dismissed the Securities Act claims for failure to state a 

claim and found that Yan did not have standing to bring the 

Exchange Act claims. We agree with the district court both that 

Yan failed to allege a violation of the Securities Act and that he 

lacked standing to challenge ReWalk's alleged failures to make 

certain disclosures after his purchases of ReWalk securities. The 

district court also determined that, because Yan lacked standing, 

it lacked jurisdiction to consider Yan's request to amend the 

complaint to add Joanne Geller as a named plaintiff to press the 

Exchange Act claims on behalf of a putative class. While we 

disagree with that reasoning, we affirm dismissal of the action 

because the proposed amendment would have been futile, as it failed 

to state an Exchange Act claim. 

I. 

ReWalk (previously Argo Medical Technologies, Inc.) 

designs and manufactures robotic exoskeletons that allow for 

upright locomotion by individuals with spinal cord injuries. One 
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such exoskeleton, ReWalk Personal ("the device"), is intended for 

long-term use at the user's home and in the community. The device 

is subject to FDA regulation. ReWalk successfully applied to the 

FDA for permission to market the device. See 21 U.S.C. § 360e(f). 

The FDA's order granting that permission labeled the device as a 

class II medical device, meaning its use carries a medium risk 

requiring some "special controls," such as training and warning 

labels, to ensure safe operation. See id. § 360c(a)(1)(B). 

The FDA's letter conveying its permission also contained 

an order pursuant to Section 522 of the Food, Drug, and Cosmetic 

Act (FDCA), id. § 360l(a)(1)(A), that ReWalk conduct a postmarket 

surveillance study on the device. Section 522 grants the FDA the 

authority to investigate risks related to class II devices where, 

as relevant here, the device's failure "would be reasonably likely 

to have serious adverse health consequences." Id. For such 

devices, the FDA can order a postmarket surveillance study in order 

to "understand the nature, severity or frequency of suspected 

problems," "obtain more information on device performance," 

"address the long term or infrequent safety and effectiveness 

issues for implantable and other devices," and "better define the 

association between problems and devices when unexpected or 

unexplained serious adverse events occur." Div. of Epidemiology, 

U.S. Dep't of Health & Hum. Servs., Postmarket Surveillance Under 

Section 522 of the Federal Food, Drug, and Cosmetic Act: Guidance 
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for Industry and Food and Drug Administration Staff (2016). The 

Section 522 order, central to several issues on this appeal, stated 

in relevant part as follows: 

[The device's] failure to prevent a fall would 

be reasonably likely to cause user injury 

and/or death through fall related sequelae 

such as traumatic brain injury (TBI), spinal 

cord injury (SCI), and fractures to the 

user . . . . In addition, during intervention 

due to a loss of balance of the patient, the 

device may potentially harm a "companion". 

. . . 

[The] FDA is concerned with the following: 

The safety and effectiveness of the ReWalkTM

has been demonstrated in an institutional 

environment (e.g. hospital, rehabilitation 

institution). However, there is limited 

information on use outside of the 

institutional setting (e.g. community and at 

home use) given that [ReWalk] intends for the 

product's use in non-institutional settings. 

[ReWalk] has not provided a complete community 

and at home use dataset; however, the 

institutional data provided demonstrate that 

the benefits outweigh the risks if used in 

conjunction with a comprehensive training 

program. A 522 study is ordered to 

effectively evaluate the training program and 

long-term safety of the device . . . . 

Because successful use of the ReWalkTM device 

requires training and a companion, we believe 

that a rigorous multi-tiered training program 

may mitigate the risk of serious injury to the 

user and companion. Therefore, an assessment 

that your training regimen is adequate will be 

required. 

 Accordingly, under section 522 of the 

Act, we are ordering you to conduct a 

postmarket surveillance study of your device 

to report the rate and nature of all falls and 

associated injuries which may occur when the 

device is used in institutional and noninstitutional environments such as the clinic, 

home, and community. Additionally, data 
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should be collected to reflect all incidences 

of injury to a companion in conjunction with 

the use of the device. 

. . . 

1. What is the 12-month incidence of serious 

adverse events in institutional and noninstitutional environments . . . ? 

2. What is the 12-month incidence of falls and 

companion injuries in institutional or noninstitutional environments . . . ? 

3. What device malfunctions are reported and 

observed? 

The FDA required ReWalk to submit for FDA approval a proposed study 

plan, which ReWalk did (albeit five days late), and to commence 

its study within fifteen months. See 21 U.S.C. § 360l(b)(1). 

Before hearing back from the FDA on its proposed plan, 

ReWalk issued, on August 26, 2014, a Registration Statement for an 

IPO. That Statement touted the device's success in clinical 

studies and "rigorous trials," calling it a "breakthrough 

product," with "compelling clinical data" "demonstrat[ing] the 

functionality and utilization" of the device. It further noted 

that the FDA ordered "performance of a postmarket surveillance 

clinical study demonstrating a reasonable assurance of safety and 

effectiveness in urban terrain," regarding which "[f]ailure to 

comply . . . could lead to removal of ReWalk from the market." It 

did not explicitly state that the FDA ordered this study 

specifically because the device's failure "would be reasonably 

likely to have serious adverse health consequences" -- namely, a 

risk of spinal cord, brain, or skeletal injuries as a result of 
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falls. But it did state elsewhere that "[i]f any part of [the 

device]'s hardware or software were to fail, the user could 

experience death or serious injury" and that "there is no longterm clinical data with respect to the safety or physical effects" 

of the device. ReWalk went public under this Statement on 

September 12, 2014, selling 3,450,000 shares and raising over 

$41 million. Yan was an early purchaser, paying $35,460 for shares 

on September 15 and 17. 

Thereafter, ReWalk and the FDA entered into a lengthy 

back-and-forth necessitated by ReWalk's halting performance of its 

obligations under the FDA's grant of marketing permission. ReWalk 

missed deadlines for submitting plans for the postmarket 

surveillance study, and the plans it did submit and revise were 

repeatedly deemed inadequate by the FDA. Eventually, on 

September 30, 2015, the FDA issued a warning letter stating the 

device "is currently misbranded under [the FDCA]" and threatening 

sanctions absent corrective action by ReWalk. See 21 U.S.C. 

§ 352(t)(3). The letter also noted that the company failed to 

make much progress towards meeting the statutory, fifteen-month 

deadline by which it was to commence an approved postmarket 

surveillance study. Labeling a device as misbranded can carry 

grave consequences, including seizure of the device, injunctions 

against its manufacture and sale, prosecution, and civil monetary 

penalties. See, e.g., id. §§ 331, 334(a)(1). 
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Throughout 2015, ReWalk's management held several 

quarterly calls with investors, making no mention of the FDA's 

dissatisfaction with ReWalk's progress toward commencing the 

required study. It was not until the end of February 2016 that 

ReWalk disclosed the FDA's warning, right before the FDA published 

the warning letter on March 1. ReWalk stock had closed the day 

before at $10.48/share, but it ended March 1 at $9.07/share, a 13% 

one-day drop. Proposed plaintiff Geller, who had purchased ReWalk 

securities in late 2015, was among those who suffered a loss when 

the stock price dropped.

The FDA exercised its discretion to allow ReWalk to 

continue marketing the device as long as it commenced a postmarket 

surveillance study by June 1, 2016. It approved ReWalk's study 

plan on May 5, 2016, although, as of the date of the amended 

complaint, the FDA still described ReWalk's progress towards 

completing the study as "inadequate." Nonetheless, plaintiffs do 

not allege that the FDA has undertaken any enforcement action 

against ReWalk.

After a number of lawsuits against ReWalk not relevant 

here had been filed, six individuals (including Yan) and one 

institution filed this proposed class action on January 31, 2017. 

The complaint alleged only violations of the Securities Act. Yan 

successfully moved to be appointed lead plaintiff under the Private 
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Securities Litigation Reform Act of 1995 (PSLRA).1 The Securities 

Act claim focuses exclusively on statements made in (or omitted 

from) the August 2014 Registration Statement. In a nutshell, it 

alleges that ReWalk failed to include in the Registration Statement 

enough information about the reasons the FDA required a postmarket 

surveillance study. 

In August 2017, plaintiffs amended the complaint to add 

claims under sections 10(b) (and Rule 10b-5 promulgated 

thereunder) and 20(a) of the Securities Exchange Act of 1934. See 

15 U.S.C. §§ 78j(b), 78t(a); 17 C.F.R. § 240.10b-5. These Exchange 

Act claims primarily train on statements and omissions occurring 

after the IPO. In brief, they assert that ReWalk with scienter 

failed to disclose the difficulties it was experiencing with the 

FDA even as it sought to comfort investors about its progress. In 

due course, defendants filed an omnibus motion to dismiss the 

complaint, which the district court granted in part on August 23, 

2018. 

As to the Securities Act claims, the district court 

reasoned that the Registration Statement's allegedly misleading 

statements were true and there were no actionable omissions. See 

1 The PSLRA requires appointment of a lead plaintiff early 

in class-action securities cases. 15 U.S.C. § 78u-4(a)(3). In 

making this selection, the district court must consider several 

factors, one of which is the relative amount of securities 

purchased, id. § 78u-4(a)(3)(B)(iii)(I)(bb), which favored 

selecting Yan for this claim. 
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Wang Yan v. ReWalk Robotics Ltd. (Yan I), 330 F. Supp. 3d 555, 

570–72 (D. Mass. 2018). The district court also noted that the 

complaint failed to mention Regulation S-K, see 17 C.F.R. 

§§ 229.105, .303, so the court refused to consider whether the 

complaint stated a plausible theory of liability under the 

regulation. Yan I, 330 F. Supp. 3d at 569–70. 

As to the Exchange Act claims, the district court first 

determined that the potentially actionable omissions and/or 

misleading statements all occurred long after Yan made his last 

purchase of ReWalk securities. Id. at 572. The district court 

reasoned that Yan would be unable to prosecute the Exchange Act 

claims unless, perhaps, he could show that the statements made 

after his purchase were part of a common scheme extending back to 

the time period during which Yan made his purchases. Id. at 572–

74. The court asked for supplemental briefing on these issues. 

It also suggested Yan might seek a substitute lead plaintiff who 

might be able to prosecute the claims. Id. at 574. In response, 

Yan advanced two arguments. First, he claimed to have alleged a 

common fraudulent scheme tying together the misrepresentations in 

the Registration Statement and the later alleged omissions and 

misstatements in the quarterly calls with investors. Second, he 

argued that, even if he could not pursue the Exchange Act claims, 

Geller should be added as a named party to replace Yan as lead 

plaintiff to pursue the Exchange Act claims on behalf of the class. 
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To further that second argument, Yan moved for leave to file a 

second amended complaint adding Geller as a named plaintiff. 

The district court analyzed these arguments in two 

steps. First, it determined that the allegations fell well short 

of tying any allegedly misleading statements made prior to Yan's 

purchases to the alleged misrepresentations and omissions 

occurring after Yan's purchases; i.e., the amended complaint 

failed to allege a common scheme to defraud. Wang Yan v. ReWalk 

Robotics Ltd. (Yan II), 391 F. Supp. 3d 150, 156–57 (D. Mass. 

2019). Second, the district court reasoned that, because all of 

Yan's own claims failed, he lacked standing to move for an 

amendment to the complaint that simply added another plaintiff to 

pursue a claim that Yan himself had no standing to pursue. Id. at 

156–61. Accordingly, it dismissed the remaining claims. Yan 

timely appealed the judgment.

II. 

Our review of a judgment dismissing a claim under Rule 

12(b)(6) is de novo, and we may affirm the dismissal "on any basis 

available in the record." Lemelson v. U.S. Bank Nat'l Ass'n, 721 

F.3d 18, 21 (1st Cir. 2013). In reviewing the motion, we take as 

true the facts alleged in the complaint and any reasonable 

inferences drawn from those facts, disregarding conclusory 

allegations. O'Brien v. Deutsche Bank Nat'l Tr. Co., 948 F.3d 31, 

35 (1st Cir. 2020). We may also consider documents attached to 
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the complaint and incorporated by reference therein. Id. Although 

ReWalk argues that we should apply the heightened pleading 

standards of Federal Rule of Civil Procedure 9(b) because this 

Securities Act claim "sounds in fraud," Silverstrand Invs. v. AMAG 

Pharm., Inc., 707 F.3d 95, 102 (1st Cir. 2013), we need not decide 

whether Rule 9(b) applies because, as we will explain, the 

complaint fails even under the less-strict requirements of Rule 8. 

Under those requirements, we ask if the complaint's factual 

allegations plausibly state a claim that entitles the pleader to 

relief. Mass. Ret. Sys. v. CVS Caremark Corp., 716 F.3d 229, 237 

(1st Cir. 2013). 

We consider first whether Yan successfully pleaded a 

claim that ReWalk violated the Securities Act by misstating or 

failing to disclose material information in its Registration 

Statement for its IPO. Relatedly, we also consider Yan's theory 

of Securities Act liability under Regulation S-K. Third, we 

consider a procedural objection Yan raises to the district court's 

reliance on a statutory safe harbor for forward-looking 

statements. 

A. 

Section 11 of the Securities Act creates a cause of 

action based on a registration statement that "contain[s] an untrue 

statement of a material fact or omit[s] . . . a material fact 

required to be stated therein or necessary to make the statements 
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therein not misleading." 15 U.S.C. § 77k(a). It creates a form 

of "strict liability" for the issuer, in this case ReWalk, for 

misleading statements, although other defendants can be liable for 

negligence. Silverstrand Invs., 707 F.3d at 102. An issuer may 

be liable under the "omissions clause" only where "an issuer's 

failure to include a material fact has rendered a published 

statement misleading." Omnicare Inc. v. Laborers Dist. Council 

Constr. Indus. Pension Fund, 575 U.S. 175, 194 (2015). As 

discussed below, Regulation S-K also creates a duty to disclose 

information in certain situations. 

1. 

The principal theory Yan advances in support of his 

Securities Act claim focuses on the Registration Statement's 

description of the FDA's evaluation of the device. While ReWalk 

disclosed that the FDA ordered a surveillance study, Yan complains 

that the disclosure was misleading because ReWalk did not reveal 

that "the FDA specifically determined, in June 2014, that the . . . 

device's failure to prevent a fall would be reasonably likely to 

cause serious injury or death to the user and place individuals 

assisting the user at the risk of harm from a potential fall." 

Yan asserts that "because the device was reasonably likely to cause 

serious injury or death, [ReWalk]'s boilerplate recitation of 

potential adverse regulatory consequences was rendered 

meaningless." 
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We disagree. The device as described in the Registration 

Statement is an exoskeleton upon which a paralyzed user "relies 

completely . . . to hold him or her upright." The Registration 

Statement expressly noted that such a "user could experience death 

or serious injury" were the device to malfunction. Given this 

context, when ReWalk disclosed that it had to "demonstrate a 

reasonable assurance of safety" to the FDA through its study, no 

reader would suspect that the FDA was concerned about mere bumps 

and bruises. 

Nor did the FDA find that the product "was reasonably 

likely to cause serious injury or death," as Yan claims. The FDA 

stated only that it had "limited information" on the "rate and 

nature" of falls during home use but that a "comprehensive training 

program" may mitigate these risks. Neither the statute nor the 

FDA's guidance suggests that the FDA need find a reasonable 

likelihood of injury in order to require a postmarket surveillance 

study, and Yan does not allege any studies showing such a 

likelihood of harm. The Registration Statement discloses that the 

FDA wanted assurances of the device's safety given its incomplete 

knowledge, and the primary safety issue associated with this device 

is instability that can lead to serious injury or death -- exactly 

what the FDA's Section 522 order noted. 
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2. 

Yan also points to the Registration Statement's 

reference to the study as examining the device's performance in 

"urban terrain" as potentially misleading. He complains only that 

the Registration Statement offered no "expla[nation]" or 

"defin[ition]" of the term. Yan seems to say that the term would 

be read as excluding rural and suburban non-institutional 

settings. Even were that so, Yan does not explain how this choice 

of language made the earlier warning language about death or injury 

in any setting misleading. Perhaps Yan is saying, without 

explaining how, that investors would regard a study in "urban 

terrain" easier to pass than one in suburban (or rural) terrains? 

Or perhaps, conversely, a test limited to a crowded cityscape may 

result in a higher percentage of accidents, although we are 

perplexed as to how describing a test as more difficult to pass 

than it actually is would induce individuals who would not 

otherwise invest to do so? In any event, Yan never develops how 

possible puzzlement over the term would result in materially 

misleading an investor. 

3. 

The district court also dismissed claims regarding the 

Registration Statement's touting of "compelling clinical data" 

showing the device's success and its assertion that the device is 

a "breakthrough product," finding them to be unactionable puffery. 
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Yan assigns error, arguing that these boasts are instead false or 

misleading "concrete statements of present fact." We again 

disagree. The district court correctly stated that "upbeat 

statements of optimism and puffing about [a] company's prospects" 

are not actionable. Greebel v. FTP Software, Inc., 194 F.3d 185, 

207 (1st Cir. 1999). An example of such unactionable puffery found 

elsewhere includes a claim of "breakthrough drug." City of 

Edinburgh Council v. Pfizer, Inc., 754 F.3d 159, 173 (3d Cir. 2014) 

(internal quotation marks omitted). This Registration Statement's 

"breakthrough" assertion is not materially different. Yan 

attempts to distinguish Edinburgh on the ground that the defendant 

there referred to the relevant drug as a "potential" breakthrough. 

Id. But the drug in Edinburgh was still in the pre-market 

development stage, Phase 2 trials, at the time the alleged 

misrepresentations were made. Id. at 163. So while Pfizer's 

statement could be said to have been more forward looking, i.e., 

"once the drug fully hits the market, it will be a breakthrough," 

here ReWalk has a product that is essentially done with the 

development stage and is post-market, so the Registration 

Statement is saying that it is a breakthrough. In each instance, 

the word "breakthrough" is simply a puffed-up qualitative 

expression of the product's novelty. 

Statements of opinion can be actionable if "the real 

facts are otherwise, but not provided." Omnicare, Inc., 575 U.S. 
- 17 - 

at 188. But the Registration Statement provides the relevant facts 

through detailed descriptions of the device and how it works. It 

explains that the device is "the only commercialized exoskeleton 

using a tilt sensor to restore self-initiated walking," which Yan 

does not contest as untrue, effectively conceding that 

"breakthrough" was hardly beyond the pale of optimistic puffery. 

Moreover, the FDA's "de novo" classification of the device, meaning 

the FDA found it to be "not substantially equivalent" to extant 

devices, 21 C.F.R. § 807.100(a)(2), itself suggests that the 

device is at least somewhat unique.2 

Similarly, we find no liability in ReWalk's description 

of the device's clinical results as "compelling." ReWalk cited 

and discussed the results to which it was referring and noted the 

types of studies that the device was yet lacking. A reasonable 

investor concerned with ReWalk's characterization of the data 

could easily pick her own preferred qualitative adjective. 

2 The Registration Statement also describes the market for 

exoskeletons as "new and unproven," providing some of the details 

about this developing area of medicine, characterizations that Yan 

does not take exception to. It further describes both the limited 

number of competitors that were in the market at the time and some 

competitive products. 
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B. 

As an alternative theory of liability under the 

Securities Act, Yan points to Items 303 and 5033 of Regulation SK. Unlike Section 11 of the Securities Act standing alone, these 

regulatory requirements do create an affirmative duty to disclose 

certain information even if the Registration Statement does not 

itself create the need for a disclosure as a remedy for a halftruth. See 17 C.F.R. §§ 229.105, .303(a)(3)(ii). Item 303 creates 

liability where "a registrant knew about an uncertainty before an 

offering," "the known uncertainty is 'reasonably likely to have 

material effects on the registrant's financial condition or 

results of operation,'" and "the offering documents failed to 

disclose the known uncertainty." Silverstrand Invs., 707 F.3d at 

103. Similarly, Item 503 creates liability where "the registrant 

knew, as of the time of the offering, that (1) a risk factor 

existed; (2) the risk factor could adversely affect the 

registrant's present or future business expectations; and (3) the 

offering documents failed to disclose the risk factor." Id. 

The district court dismissed any consideration of these 

theories on the grounds that Yan did not cite the regulations in 

the complaint. Yan I, 330 F. Supp. 3d at 569–70 (citing In re Hi3 Now recodified as Item 105. FAST Act Modernization and 

Simplification of Regulation S-K, 84 Fed. Reg. 12,674, 12,716–17 

(April 2, 2019). 
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Crush Partners L.P. Sec. Litig., No. 12 CIV. 8557, 2013 WL 6233561, 

at *11 n.6 (S.D.N.Y. Dec. 2, 2013)). We need not decide whether 

Yan adequately pleaded the Regulation S-K claim because we reject 

this claim on alternate grounds. 

Yan's argument, like his Section 11 arguments, is that 

ReWalk disclosed neither the risk of "instability, falls, and 

associated injuries" identified by the FDA nor that the device's 

safety "had not been established outside the controlled 

institutional environment of a hospital or rehabilitation center." 

As discussed above, however, this argument fails because the 

Registration Statement did not omit these risks. It noted, just 

for example, that "[t]here is no long-term clinical data with 

respect to the safety or physical effects of [the device]" and 

that approval for use "beyond the institutional/rehabilitational 

setting" requires performance of the relevant postmarket study. 

Indeed, the very requirement to conduct the study, explicitly 

disclosed, clearly suggested that the FDA perceived a risk that 

needed to be understood better. In short, ReWalk adequately 

disclosed the claimed risk or uncertainty, so we affirm the 

dismissal of the Securities Act claims even as viewed through the 

lens of Regulation S-K. 

C. 

As to his Securities Act claims, Yan raises, finally, a 

procedural objection, complaining that the district court excused 
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some of the statements challenged in the Registration Statement by 

"sua sponte" relying on the statutory safe harbor for forwardlooking statements. See 15 U.S.C. § 78u-5(c)(1), (i)(1). 

It is sometimes inappropriate for a district court to 

advance on its own a reason to dismiss a claim. See Futura Dev. 

of P.R., Inc. v. Estado Libre Asociado de P.R., 144 F.3d 7, 13–14 

(1st Cir. 1998). Even if that happened here, the reason raised by 

the district court posed a pure issue of law. Because Yan gets a 

de novo appeal, and we hold him to no waiver of any type on this 

issue, he has lost no chance to marshal any supporting arguments. 

He also points to nothing that he would have added to the record 

had ReWalk raised the argument itself. In short, he is in no worse 

a position than he would have been in had ReWalk fully raised and 

briefed the defense below. See Pediatricians, Inc. v. Provident 

Life & Accident Ins. Co., 965 F.2d 1164, 1173 (1st Cir. 1992) 

(repeating the "well settled rule" that we "may affirm the judgment 

of the district court on any independently sufficient ground," 

even where that basis was "not briefed or argued" in the district 

court). 

As noted by the district court, a statement is not 

actionable if it is "a forward-looking statement, and [it] is 

accompanied by meaningful cautionary statements identifying 

important factors that could cause actual results to differ 

materially from those in the forward-looking statement." 15 U.S.C. 
- 21 - 

§ 78u-5(c)(1)(A)(i). Here, the statements that the district court 

concluded were protected by the safe harbor, which Yan challenges, 

are that ReWalk "intend[s] to continue to work with [various 

entities] to generate additional data regarding functionality and 

that supports the health and economic benefits of [the device]" 

and that it will "continue to engage and fund researchers and 

organizations to conduct clinical studies to demonstrate the 

functionality and utilization of ReWalk and to highlight economic 

benefits of reductions in medical complications associated with 

spinal cord injury." Further, ReWalk "believe[s] that this data 

will position [ReWalk] to pursue additional third-party 

reimbursement for [its] products."4 The verb tense as well as a 

specific warning about "expectations as to [ReWalk's] clinical 

research program and clinical results" make clear that these 

statements are forward looking, and the Registration Statement 

includes the safe harbor notice regarding the risk factors that 

could cause the actual clinical results to differ by telling 

investors they "should consider the risks provided under the 'Risk 

Factors' in this prospectus" when evaluating these statements. 

The Registration Statement also disclosed that "future studies or 

4 Although the district court did not clearly reference this 

last statement in its analysis, it is in the same paragraph of the 

Registration Statement and complaint. Given its context, it is 

clear that it should be considered alongside ReWalk's views about 

the effect of its future clinical studies. 
- 22 - 

clinical experience may indicate that treatment with [the device] 

is not superior to treatment with alternative products or 

therapies" and that insurers may never provide coverage for these 

devices due in part to their "experimental" nature backed by 

"limited clinical data." Taken together, we agree with the 

district court that none of these challenged statements concerning 

ReWalk's expectancy for the future were actionable.5

III. 

A. 

After dismissing the Securities Act claims, the district 

court determined that ReWalk made no relevant Exchange Act 

omissions or misstatements until months after Yan purchased his 

shares on September 15 and 17, 2014. It found this chronology to 

be fatal to Yan's standing to bring the Exchange Act claims. 

Yan II, 391 F. Supp. 3d at 156–57 (citing Gross v. Summa Four, 

Inc., 93 F.3d 987, 993 (1st Cir. 1996) ("[B]ecause [plaintiff] 

purchased his stock . . . before the [alleged misrepresentation], 

he has no standing to complain about the statements . . . .")). 

Yan contends that, in so reasoning, the district court 

overlooked the fact that the complaint alleges that ReWalk repeated 

after the IPO the same misstatements and omissions that are the 

5 Yan concedes that Securities Act Section 15 claims require 

a valid Section 11 claim. It follows that dismissal of the Section 

15 claims was proper. 
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subject of Yan's Securities Act claim. Thus, he reasons, ReWalk 

engaged in a "common scheme" that tied together claimants who 

purchased in the IPO with claimants who purchased after the IPO. 

The problem with this theory is that, as we have 

explained, the statements and claimed omissions in the 

Registration Statement (concerning risk, injury, and "urban 

terrain") were not misleading in any relevant sense. So even if 

fraud occurred after the IPO, there is no basis for claiming that 

it commenced before the IPO. The Exchange Act claims of fraud 

rise or fall instead on consideration of ReWalk's decision not to 

disclose the difficulties it was having after the IPO in seeking 

approval by the FDA of a study plan. And all of that difficulty 

ensued after Yan bought his stock, with the FDA's first response 

informing ReWalk of its shortcomings arriving on September 29, 

2014. So we agree with the district court that there was no basis 

for any claim of a "common scheme" tying together pre- and postIPO statements and/or omissions, and to the extent post-IPO 

omissions and/or statements were actionable under the Exchange 

Act, Yan had no standing to pursue such claims. 

This failure to tie anything misleading in the 

Registration Statement to later alleged fraudulent omissions dooms 

Yan's only argument as to why he should be able to continue to 

pursue the Exchange Act claims of other persons as their class 

representative under Federal Rule of Civil Procedure 23(b)(3). 
- 24 - 

Persons who wish to represent a class "must allege and show that 

they personally have been injured, not that injury has been 

suffered by other, unidentified members of the class to which they 

belong and which they purport to represent." Simon v. E. Ky. 

Welfare Rts. Org., 426 U.S. 26, 40 n.20 (1976) (quoting Warth v. 

Seldin, 422 U.S. 490, 502 (1975)); see Plumbers Union Loc. No. 12 

Pension Fund v. Nomura Asset Acceptance Corp., 632 F.3d 762, 769 

n.6 (1st Cir. 2011) (citing 5 J. Moore et al., Moore's Federal 

Practice § 26.63 [1][b], at 23–304 (3d ed. 2010), for the 

proposition that for each claim there must be a class 

representative who has standing to raise that claim). Yan 

identifies no such similar injury without the Registration 

Statement in play. Even apart from the matter of standing, it 

would hardly serve the interests of class members who may have 

valid claims based on their facts to be represented by a person 

whose facts dictate that he or she will lose the case even if the 

class members might have won. For these reasons, and likely 

others, the district court plainly got it right in refusing to 

allow Yan to proceed as an Exchange Act class representative. 

B. 

After the district court dismissed Yan's Securities Act 

claim in Yan I, Yan moved to amend the complaint to add Geller as 

a named plaintiff to pursue the Exchange Act claim. When the 

district court took up this motion, it first dismissed Yan's 
- 25 - 

Exchange Act claim, as just explained. Yan II, 391 F. Supp. 3d at 

157. It then reasoned that, bereft of any such claim, Yan had no 

standing to ask the court to do anything at all, including adding 

a party. Id. at 158–61. 

There are indeed some cases in which courts suggest this 

formalistic approach is correct. As circuit authority, the 

district court pointed to Summit Office Park, Inc. v. United States 

Steel Corp., which stated that, "where a plaintiff never had 

standing to assert a claim against the defendants, it does not 

have standing to amend the complaint and control the litigation by 

substituting new plaintiffs, a new class, and a new cause of 

action." 639 F.2d 1278, 1282 (5th Cir. 1981); see also, e.g., 

Lierboe v. State Farm Mut. Auto. Ins. Co., 350 F.3d 1018, 1023 

(9th Cir. 2003); Westfield Park Homeowners' Ass'n, Inc. v. NVR, 

Inc., No. 1:06 CV 00507, 2007 WL 9774486, at *4 (N.D. Ohio Mar. 27, 

2007). The better-reasoned authority, though, allows a court to 

entertain and grant a motion to amend filed by a plaintiff who 

lacks standing to pursue the claim pleaded. 

That authority includes the Supreme Court. In a seminal 

standing case, Sierra Club v. Morton, the Court held that the 

Sierra Club lacked standing because any injury would be directly 

felt only by others. 405 U.S. 727, 735, 741 (1972). The Court 

nevertheless invited Sierra Club to amend its complaint to better 

plead standing. Id. at 735 n.8 ("Our decision does not, of course, 
- 26 - 

bar the Sierra Club from seeking in the district court to amend 

its complaint by a motion under Rule 15.”); see also Mathews v. 

Diaz, 426 U.S. 67, 75 & n.8 (1976) (recognizing that the plaintiff 

had not satisfied "a nonwaivable condition of jurisdiction" before 

filing suit, but concluding that this defect did not void the suit 

ab initio because "[a] supplemental complaint in the District Court 

would have eliminated this jurisdictional issue"). 

Our own circuit has matter-of-factly followed precisely 

this same approach, reversing the denial of a motion to amend where 

the amended pleading established Article III standing by adding 

facts not contained in the prior complaint. Adams v. Watson, 10 

F.3d 915, 919-25 (1st Cir. 1993). More recently we observed that 

"Rule 15(d) has been viewed as an appropriate mechanism for 

pleading newly arising facts necessary to demonstrate standing." 

See U.S. ex rel. Gadbois v. PharMerica Corp., 809 F.3d 1, 15 (1st 

Cir. 2015) (citing Northstar Fin. Advisors, Inc. v. Schwab Invs., 

779 F.3d 1036, 1044–45 (9th Cir. 2015)). 

Congress has explicitly endorsed this view, even as 

expanded to cover all jurisdictional defects. See 28 U.S.C. § 1653 

("Defective allegations of jurisdiction may be amended, upon 

terms, in the trial or appellate courts."); see also Williams v. 

Lew, 819 F.3d 466, 471 (D.C. Cir. 2016). So too have the betterreasoned circuit court opinions. See, e.g., A.W. v. Tuscaloosa 

City Schs. Bd. of Educ., 744 F. App'x 668, 672 (11th Cir. 2018) 
- 27 - 

("[C]ourts may authorize amendment of a complaint under Rule 15 

even in the absence of jurisdiction."); Est. of Cornejo ex rel. 

Solis v. City of Los Angeles, 618 F. App'x 917, 920 n.2 (9th Cir. 

2015) (holding in the alternative that even if the plaintiffs did 

not have standing initially, they properly amended their pleadings 

under Rule 15 before judgment, "resolv[ing] any standing issues"); 

Advanced Magnetics, Inc. v. Bayfront Partners, Inc. (AMI), 106 

F.3d 11, 13 (2d Cir. 1997) ("Though we uphold the district court's 

ruling that the assignments were not sufficient to give AMI 

standing to pursue the shareholders' claims, we conclude that the 

court should not have dismissed those claims but should have 

granted AMI's request to amend the complaint to allow the 

shareholders to pursue their own claims."); Adams, 10 F.3d at 919–

25; Nat'l Post Off. Mail Handlers Loc. No. 305 v. U.S. Postal 

Serv., 594 F.2d 988, 991 (4th Cir. 1979) ("The amendment to allege 

standing explicitly should be permitted and on remand the district 

court shall grant leave to amend."); see also, e.g., Nunez v. Saks 

Inc., 771 F. App'x 401, 402–03 (9th Cir. 2019); Revell v. Port 

Auth. of N.Y. & N.J., 321 F. App'x 113, 117–18 (3d Cir. 2009). 

We also see no reason why this permissiveness does not 

extend to motions seeking to add a named party asserting the exact 

same claim that is already pleaded in the complaint. See Allied 

Int'l, Inc. v. Int'l Longshoremen's Ass'n, 814 F.2d 32, 34–36 (1st 

Cir. 1987) (citing the advisory committee's note to the 1966 
- 28 - 

amendment to Federal Rule of Civil Procedure 15, which states that 

"the attitude taken in revised Rule 15(c) toward change of 

defendants extends by analogy to amendments changing plaintiffs," 

and allowing an amendment to substitute the assignee where the 

original plaintiff had assigned its claims in their entirety, which 

otherwise would have precluded any recovery). 

Federal Rule of Civil Procedure 17 would not make much 

sense if the district court were correct. The rule expressly 

anticipates the possibility that a complaint might be brought by 

someone who turns out not to be the party in interest (i.e., is 

not the person who has standing to prosecute the claim ). See 

generally Morcelo-Martinez v. Welfare Fund ILA-PRSSA, 972 F.2d 337 

(1st Cir. 1992) (affirming dismissal where plaintiffs "lacked 

standing to bring this action since they were not the real parties 

in interest"); MHI Shipbuilding, LLC v. Nat'l Fire Ins. Co. of 

Hartford, 286 B.R. 16, 27–28 (D. Mass. 2002) (discussing the 

general interaction between standing and Rule 17(a)). The rule 

expressly admonishes that "[t]he court may not dismiss an action 

for failure to prosecute in the name of the real party in interest 

until, after an objection, a reasonable time has been allowed for 

the real party in interest to ratify, join, or be substituted into 

the action." Fed. R. Civ. P. 17(a)(3). And the mechanism often 

used to substitute in the party with standing to press the claim 

is Rule 15. See Fed. R. Civ. P. 15 advisory committee's note to 
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1966 amendment (emphasizing that Rule 15(c)(3) "extends by analogy 

to amendments changing plaintiffs"); see also 6A Charles Alan 

Wright & Arthur R. Miller, Federal Practice and Procedure § 1555 

(3d ed. 2020) ("Rule 15(c) has been used in conjunction with 

Rule 17(a) to enable an amendment substituting the real party in 

interest to relate back to the time the original action was 

filed."). 

Some courts nevertheless seem to think that the 

foregoing rules somehow do not apply in a class action when the 

original plaintiff is found to lack standing and timely moves to 

add a new plaintiff who does have standing. See, e.g., Summit 

Off. Park, 639 F.2d at 1282. The simplest response to that view 

is that there is absolutely nothing at all in Rule 23 that even 

hints at such a bespoke modification of the usual amendment rules 

in a class action. This is certainly not to say that motions to 

amend so as to change named plaintiffs must be allowed. It is 

simply to say that such motions must be evaluated just as they 

would be under Rule 15 criteria in any other case. Those criteria 

consist principally of whether there was, per Foman v. Davis, 

"undue delay, bad faith or dilatory motive on the part of the 

movant, repeated failure to cure deficiencies by amendments 

previously allowed, undue prejudice to the opposing party by virtue 

of allowance of the amendment, [and] futility of the amendment." 

371 U.S. 178, 182 (1962). 
- 30 - 

The Second Circuit's AMI opinion is especially 

instructive and is almost directly on point with our present case. 

AMI brought a class action under the Exchange Act. 106 F.3d at 

14. The district court found that AMI had no standing to assert 

the Exchange Act claim. Id. at 15. AMI moved under Rule 15 to 

amend the complaint to bring in another party that did have 

standing to assert the Exchange Act claim, which the district court 

denied. Id. The Second Circuit then affirmed the dismissal of 

the original plaintiff's claims for lack of standing, id. at 18, 

but it reversed the denial of the motion for leave to add a 

plaintiff to cure the standing defect, id. at 19–21. A contrary 

approach can claim no justification other than a desire to adhere 

to a degree of pure formalism that would surprise the drafters of 

the civil rules, achieve nothing but mischief, and run contrary to 

our own recognition that Rule 15 "helps courts and litigants to 

avoid pointless formality." Gadbois, 809 F.3d at 4. 

Nothing in the foregoing is contrary to our decision in 

Pruell v. Caritas Christi, 645 F.3d 81 (1st Cir. 2011). Pruell 

addressed a question of federal court removal jurisdiction: 

Whether the case was properly removed turned on whether one of the 

plaintiffs was, on the day of removal, a party to a collective 

bargaining agreement. Id. at 83. The court held, quite properly, 

that it need consider only the named plaintiffs in answering that 

question, not persons who might or might not become class members 
- 31 - 

if the case were certified under Rule 23. Id. at 83–84. In so 

doing, it acted in accord with the view that jurisdiction is based 

on the claims of only the named class members. Id. at 84. That 

may no longer be true under CAFA, see Standard Fire Ins. Co. v. 

Knowles, 568 U.S. 588, 592 (2013) (citing 28 U.S.C. § 1332(d)), 

but that is beside the point. The point is that Pruell has nothing 

to say about whether and when a pleading may be amended to add a 

plaintiff. 

This case is especially well suited to the prevailing 

rules because the district court at all times actually did have 

Article III subject matter jurisdiction over the action, as Yan 

had pleaded his own nonfrivolous Securities Act claim, which we 

today review without any notion that we somehow lack jurisdiction 

over the case. And while that standing may well be insufficient 

to allow Yan to serve as a class representative over the Exchange 

Act claims, nothing in rule or reason says that the district court 

could not welcome on board another litigant who does have standing 

to serve as a class representative on that count (assuming all 

Rule 23 and statute of limitations requirements are satisfied). 

See Cotton v. Certain Underwriters at Lloyd's of London, 831 F.3d 

592, 595 (5th Cir. 2016) (distinguishing Summit and holding that, 

even if a party lacked constitutional standing over one claim, 

leave to amend was still proper because there was a separate claim 

in the suit that the court had jurisdiction to hear). There is 
- 32 - 

also no contention that dismissal of a claim over which the court 

has standing precludes a party with standing from seeking leave to 

amend. See, e.g., O'Boyle v. Real Time Resolutions, Inc., 910 

F.3d 338, 347 (7th Cir. 2018). 

In sum, the requirements of standing presented no 

impediment in this case to the granting of the motion to add Geller 

as a named plaintiff on the Exchange Act claims.6

C. 

Anticipating the possibility that we might reject the 

reason given by the district court for denying the motion to amend, 

ReWalk argues that we can and should affirm the denial of the 

motion to amend on other grounds not reached by the district court; 

to wit, the failure of the amended complaint to successfully plead 

an actionable Exchange Act claim. Although it is often appropriate 

to leave such a matter for the district court to address in the 

first instance on remand, especially when the grounds are not fully 

developed or fairly contested on appeal, see Loftness Specialized 

Farm Equip., Inc. v. Twiestmeyer, 742 F.3d 845, 851 (8th Cir. 

2014), the law is clear that we have the discretion to affirm a 

decision of the district court on alternative grounds, see 

Ticketmaster-N.Y., Inc. v. Alioto, 26 F.3d 201, 204 (1st Cir. 

6 Judge Lynch and Judge Stahl limit their joining in this 

portion of the opinion on the basis that the standing defect in 

this case may be viewed as a lack of statutory standing. 
- 33 - 

1994). We exercise that discretion in this case for two reasons. 

First, we are dealing with issues of law: Whether the amended 

"complaint adequately alleges facts that would plausibly make out 

a claim," Abdallah v. Bain Cap. LLC, 752 F.3d 114, 119 (1st Cir. 

2014), and similarly, whether the failure of a proposed amended 

pleading to state a claim is a basis for denying the motion to 

amend, Rife v. One W. Bank, F.S.B., 873 F.3d 17, 21 (1st Cir. 

2017). Second, the parties on this appeal have extensively briefed 

the adequacy of the Exchange Act allegations, with Yan having 

anticipated and addressed it in his opening brief, and then 

furthered his argument in his reply. So we turn our attention to 

the question whether the amended complaint adequately states a 

claim under the Exchange Act. For the following reasons, we 

conclude that it does not. 

Under the Exchange Act, plaintiffs need plead a material 

falsehood or a material omission of a fact that was subject to a 

duty to disclose. See Ganem v. InVivo Therapeutics Holdings Corp., 

845 F.3d 447, 454 (1st Cir. 2017). A complaint must also 

"adequately allege, among other things, scienter." Corban v. 

Sarepta Therapeutics, Inc., 868 F.3d 31, 37 (1st Cir. 2017) 

(quoting Loc. No. 8 IBEW Ret. Plan & Tr. v. Vertex Pharm., Inc., 

838 F.3d 76, 80 (1st Cir. 2016)). Scienter can be established by 

showing a high degree of recklessness in the form of "an extreme 

departure from the standards of ordinary care, and which presents 
- 34 - 

a danger of misleading buyers or sellers that is either known to 

the defendant or is so obvious the actor must have been aware of 

it." Miss. Pub. Emps.' Ret. Sys. v. Bos. Sci. Corp., 649 F.3d 5, 

20 (1st Cir. 2011). As Yan correctly argues, he need not plead 

facts that directly show scienter. See In re Stone & Webster, 

Inc., Sec. Litig., 414 F.3d 187, 195 (1st Cir. 2005). Rather, he 

can plead scienter by pleading facts that create a "strong 

inference" of scienter: "whether '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.'" 

Corban, 868 F.3d at 37–38 (quoting Tellabs, Inc. v. Makor Issues 

& Rts., Ltd., 551 U.S. 308, 324 (2007)). "In cases where we have 

found the pleading standard satisfied, the complaint often 

contains clear allegations of admissions, internal records or 

witnessed discussions suggesting that at the time they made the 

statements claimed to be misleading, the defendant officers were 

aware that they were withholding vital information or at least 

were warned by others that this was so." In re Bos. Sci. Corp. 

Sec. Litig., 686 F.3d 21, 31 (1st Cir. 2012). 

There is no claim that ReWalk made any false statement 

during the relevant period prior to Yan’s purchase of ReWalk 

securities. Rather, the factual basis for the Exchange Act claim 

is ReWalk’s failure to disclose the travel of its pursuit of final 

FDA approval. 
- 35 - 

Our case law is clear that a company in ReWalk’s position 

is not in the ordinary case under an affirmative obligation to 

disclose "each detail of every communication with the FDA." Id. 

at 40. Relatedly, a failure to "divulge the details of interim 

'regulatory back-and-forth' with the FDA . . . when the defendants 

do provide warnings in broader terms" does not generate a strong 

inference of scienter. Kader v. Sarepta Therapeutics, Inc., 887 

F.3d 48, 59 (1st Cir. 2018) (quoting Fire & Police Pension Ass'n 

of Colo. v. Abiomed, Inc., 778 F.3d 228, 244 (1st Cir. 2015)). 

The bulk of the omissions to which Yan points concern 

run-of-the mill regulatory back-and-forths. And in light of the 

foregoing discussion regarding the adequate risk disclosures in 

the registration statement, such omissions are inadequate to 

generate a strong inference of scienter. 

The only arguable exception to this run-of-the-mill 

back-and-forth is the FDA's September 2015 warning letter, where 

the FDA informed ReWalk that its noncompliance with the postmarket 

surveillance study deadline rendered the device misbranded. The 

FDA, however, took no action at that time, instead stating only 

that "[f]ailure to promptly correct these violations may result in 

regulatory action being initiated by FDA without further notice. 

These actions include, but are not limited to, seizure, injunction, 

and/or civil money penalties." (emphasis added). As we have 

noted, the registration already disclosed that "[f]ailure to 
- 36 - 

comply with the [postmarket surveillance study, among other 

things] could lead to removal of ReWalk from the market" and that 

"fail[ure] to comply with applicable regulatory requirements . . . 

may result in" seizures, injunctions, and civil penalties. 

Furthermore, there is no allegation that ReWalk made any claim 

concerning its progress with the FDA that was inconsistent with 

its receipt of the letter. Nor is there any allegation that any 

defendant regarded the receipt of the letter as anything other 

than a warning of a need to take action that ReWalk intended to 

take (and did take). 

Of course, it is fair to infer that a written warning 

noting that a device is currently misbranded for failure to do a 

satisfactory study is not a common event. So we looked to see if 

any inference of scienter arising from nondisclosure might be 

strengthened by context. But ReWalk had already disclosed 

precisely the regulatory consequences should the FDA not grant the 

approvals it sought, and here there is no allegation of insider 

sales, of significant fundraising events between late September 

2015 and the FDA’s disclosure of the letter, or of claims that 

executives received some kind of bonus based on stock performance 

between September 2015 and February 2016 that would otherwise 

bolster this inference. See generally Greebel, 194 F.3d at 196. 

Nor is there any allegation that ReWalk expected the FDA would not 

itself make public its warning. 
- 37 - 

The amended pleading does contain allegations by socalled confidential witnesses (CW). The CW allegations make clear 

that executives had knowledge of the back-and-forth with the FDA 

and of the importance of obtaining regulatory clearance, but mere 

knowledge of facts is insufficient to support a strong inference 

of scienter. See Stone & Webster, Inc., 414 F.3d at 205. There 

must be some allegation strongly implying that defendants had 

reason to believe their omissions to be fraudulent. And Yan's 

allegations actually suggest a contrary inference: That even after 

receiving the warning letter, defendants believed they could still 

meet the FDA's requirements, as they showed "no sense of urgency" 

regarding the study until February 2016 -- exactly when they 

disclosed the warning letter to investors. While this lack of 

urgency might amount to poor management, such a failing does not 

amount to securities fraud. See Shaw v. Digit. Equip. Corp., 82 

F.3d 1194, 1206 (1st Cir. 1996). 

In sum, the complaint alleges no statements by 

defendants concerning ReWalk's proceedings with the FDA that they 

had reason to believe were contrary to the facts or previous 

disclosures, there is no allegation that defendants regarded the 

warning letter as calling on ReWalk to do what it did not intend 

to do, and there are no allegations of surrounding circumstances 

that might cast ReWalk's communications in a more suspicious light. 

All in all, on the allegations of scienter as presented, we see in 
- 38 - 

the amended complaint no adequate claim under the Exchange Act. 

So for that reason the denial of leave for Geller to join the case 

in order to prosecute that claim was not error. 

IV. 

We therefore affirm the district court's denial of the 

motion to add Geller as a party and its dismissal of the amended 

complaint.