[DO NOT PUBLISH]

IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT

________________________ No. 13

- 14249 Non

- Argument Calendar

________________________ D.C. Docket No. 0:12

- cv - 62197

- WJZ

ALLEN LICHT, Plaintiff

- Counter Defendant

- Appellant,

versus AJENE WATSON, JAMES GIBBS, et al., Defendants

- Appellees, ERIC L. NOVESHEN, Defendant

- Third Party Plaintiff

- Counter Clai mant

- Appellee, STEVEN KOIFM AN, et al., Defendants, ELLA FRANKEL, et al., Third Party Def endants

- Counter Defendants. Case: 13-14249 Date Filed: 05/22/2014 Page: 1 of 142 ________________________ Appeal from the United States District Court for the Southe rn District of Florida

________________________ (May 22, 2014) Before PRYOR , MARTIN , and FAY , Circuit Judges. PER CURIAM: Allen Licht, proceeding pro se , appeals the district court’s dismissal of his complaint

. Licht now argues that the district court erred by : (1) dismissing his claims brought under the Securities Act of 1933, the Securities Exchange Act, and the Sec urities Exchange Commission’s (SEC ) Rule 10b

- 5; (2) dismissing his claims brought under the Racketeer Influenced and Corrupt Organizations Act (RICO ); ( 3) refusing to grant leave to amend; and (4) dismissing his claims agains t defendants who did not file motion s to dismiss. After careful review, we affirm.
I. BACKGROUND Licht is the Managing Director and Chief Operations Officer of Simulated Environme nt Co ncepts, Inc. (Simulated ). Between 2008 and 2011, Licht alleges that 14 individual and 9 entity defendants orchestrated a “pump

- and

- dump” scheme using Simulated stock

. According to Licht, the defendants executed this scheme by fraudulently inducing Simula ted to issue large quantities of heavily discounted s tock to the defendants

. The defendants then began a public relations

Case: 13-14249 Date Filed: 05/22/2014 Page: 2 of 143 campaign to “ pump ” up the value of Simulated’s stock, only to “dump” thei r shares soon afterwards by unexpectedly selling off their stock en masse . Although the defendants handsomely profited from the scheme , Licht alleges that the massive sell

- off caused prices of Simulated stock to plummet, thereby harming shareholders like Licht and ruining Licht and Simulated’s reputation in the b usiness community

. On January 30, 2013, Licht filed an amended complaint in district court, alleging that the defendants had violated the Securities Act of 1933, the Securities Exchange Act, SEC Rule 10b

- 5, RICO , and various state laws. T he district court dismissed Licht’s claims under the Securities Act of 1933, the Securities Exchange Act, and SEC Rule 10b

- 5 for lack of subject matter jurisdiction. The district court also dismissed Licht’s RICO claims as barred by the Private Securities Litigation Reform Act (PSLRA). After dismissing Licht’s federal law claims with prejudice , the district court also declined to exercise supplemental jurisdiction over his state law claims. Licht now appeals.
II. DISCUSSION We review de novo a district court’s order granting a motion to dismiss for lack of subject matter jurisdiction, viewing the facts in the light most favorable to the plaintiff. Parise v. Delta Airlines, Inc. , 141 F.3d 1463, 1465 (11th Cir. 1998); see also Fin. Sec. Assuran ce, Inc. v. Stephens, Inc. , 500 F.3d 1276, 1282

– 83 (11th

Case: 13-14249 Date Filed: 05/22/2014 Page: 3 of 144 Cir. 2007) (reviewing de novo the dismissal of a Section 10(b) complaint for failure to state a claim, and affirming in part because plaintiffs failed to allege that they were buyers or sellers and thus lacked standing). W e also review de novo the district court’s dismissal for failure to state a civil RICO claim

. See Ambrosia Co al & Constr. Co. v. Pages Morales , 482 F.3d 1309, 1316 (11th Cir. 2007). We generally review the denial of a motion to amend a complaint for an abuse of discretion but we review questions of law, such as whether amendment would be futile, de novo

. Cockre ll v. Sparks , 510 F.3d 1307, 1310 (11th Cir. 2007). We liberally construe pro se pleadings, but require them to conform to procedural rules. Albra v. Advan, Inc. , 490 F.3d 826, 829 (11th Cir. 2007). Arguments that were not presented in the district cou rt are deemed waived. Access Now, Inc. v. Sw. Airlines Co. , 385 F.3d 1324, 1330

– 33 (11th Cir. 2004).
A. Securities Exchange Act and Securities Act Claims We first consider whether the district court properly dismiss ed Licht’s claims under Section 10(b) of the Securities Exchange Act, SEC Rule 10b

- 5, and Section 12 of the Securities Act. The district court dismissed the claims for lack of subject matter jurisdiction because Licht failed to allege that he was a buyer or seller of Simulated s ecurities in connection with the defendants’ actions

. Licht responds that he nevertheless has standing to pursue these claims because he is a n officer of Simulated and a lawful owner of Simulated stock . He also argues that

Case: 13-14249 Date Filed: 05/22/2014 Page: 4 of 145 the buyer

- seller requirement does not preclude relief if a plaintiff can establish a causal connection between the v iolations of law and his loss. Licht’s arguments ultimately miss the mark because the y conflict with the longstanding rule that only purchasers and sellers of securitie s can invoke the subject matter jurisdiction of the courts under Section 10(b) of the Securities Exchange Act, SEC Rule 10b

- 5, and Section 12 of the Securities Act

. See Blue Chip Stamps v. Manor Drug Stores , 421 U.S. 723, 749, 95 S. Ct. 1917 , 1932 (1975); Delta Coal Program v. Libman , 743 F.2d 852, 855 (11th Cir. 1984) (“[B]ecause an element essential to a violation of section 10(b) or rule 10b

- 5 is a sale or purchase, plaintiffs who have been unable to characterize their key transactions with the defendants as such have failed to invoke subject matter jurisdiction for those claims.”). In Blue Chip Stamps , for example , the Supreme
Court observed that Section 10(b) of the Se curities Exchange Act prohibits certain “manipulative or deceptive” conduct “in connection with the purchase or sale of any security.” 421 U.S. at 728, 95 S. Ct. at 1922. As a result, the Court endorsed the standing rule created by Birnbaum v. Newport Steel Corp. , 193 F.2d 461, 464 (2d Cir. 1952), which permits only purchasers a nd sellers of securities, and those with contracts to purchase and sell securities, to bring suit under Section 10(b) of the Securities Exchange Act and SEC Rule 10b

- 5 , which implements Section 10(b)

. 421 U.S. at 730

– 31 , 749, 95 S. Ct. at 1923, 1932. The Court adopted this

Case: 13-14249 Date Filed: 05/22/2014 Page: 5 of 146 rule even though it would exclude three principal categories of plaintiffs from bringing claims : (1) people who did not purchase stock as a result of the defendants’ conduct ; (2) people who did not sell stock as a result of the defendants’ conduct ; and (3) “shareholders, creditors, and perhaps others related to an issuer who suffered loss in the value of their investment

. ” 421 U.S. at 737

– 38, 95 S. Ct. at 1926

. In the same way, S ection 12 of the Securities Act imposes civil l iability on
any person who “offers or sells a security” by means of a misleading pros p ectus or oral communication. 15 U.S.C. § 77 l (a). The seller’s civil liability , however, is limited “to the person purchasing such security from him.” Id. Thus, a pers on only has standing to sue under Section 12 if he purchased securities from the defendant

. Id. ; s ee also Wolf v. Frank , 477 F.2d 467, 479 (5th Cir. 1973) 1 (“Section 12, in terms, provides a remedy for violations of Section 5 only to purchasers of securities . . . or to one who stands in the shoes of a purchaser

. ”) (internal citations omitted) ; Freidus v. Barclays Bank PLC , 734 F.3d 132, 141 (2d Cir. 2013) (“ In order to have standing under § 12(a)(2), however, plaintiffs must have purchased securiti es directly from the defendants

. ”). Given these well

- established standing requirements , the district court properly concluded that Licht lacked standing to bring his claims under the

1 In Bonner v. City of Prichard , 661 F.2d 1206 (11th Cir. 1981) (en banc), we adopted as binding precedent all decisions of the former Fifth Circuit handed down before October 1, 1981.

Case: 13-14249 Date Filed: 05/22/2014 Page: 6 of 147 Securities Exchange Act , SEC Rule 10b

- 5, and the Securities Act. It may be true that the defendants harmed Licht in his capacity as an officer of Simulated and an owner of Simulated stock

. But he nevertheless cannot invoke the subject matter jurisdiction of the courts under these statutes unless he alleges that he was a
purc haser or seller of stock in connection with the defendants’ fraudulent conduct

. See Blue Chip Stamps , 421 U.S. at 737

– 38, 95 S .Ct. at 1926 (noting that

“ shareholders, creditors, and perhaps others related to an issuer who suffered loss in the value of th eir investment” do not have standing under the Securities Exchange Act and SEC Rule 10b

- 5).
N either does it make a difference that Licht can establish a direct causal connection between his losses and the defendants ’ actions

. In Financial Security
Assurance , we rejected the argument that the purchaser

- seller requirement “entail[s] a functional , and not a formal , inquiry.” 500 F.3d at 1283

. If it were otherwise, the standing rules would be “subject to endless case

- by

- case erosion by courts employin g a functional an alysis. ” Id. (quotation marks omitted). Thus, Licht cannot invoke the court’s subject matter jurisdiction simply because the harm he suffered was functionally equivalent to the harm suffered by purchasers or sellers of securities

. In or der to have standing to bring these claims, Licht must formally allege that he purchased or sold securities in connection with the defendants’ actions.

Case: 13-14249 Date Filed: 05/22/2014 Page: 7 of 148 Licht responds that the se standing rules must yield to the “forced seller doctrine. ” He mistakenly claims that this doctrine allows investors to sue as long as the nature of their interest in a security was fundamentally changed as a result of a fraudulent scheme. We need not consider this argument because Licht raises it for the first time on appeal. See Access Now , 385 F.3d at 1330

– 33. In any event, the forced seller do ctrine is not as broad as Licht suggests

. The “forced seller doctrine” refers to a shareholder plaintiff who, due to a merger, “as a practical matter” must “eventually become a party to a ‘sale.’” Dudley v. Se. Factor & Fin. Corp. , 446 F.2d 303, 306

– 07 (5th Cir. 1971). We treat shareholders as f orced sellers in these post

- merger situations because “ the nature of [the shareholder’s] investment has been fundamentally changed from an interest in a going enterprise into a right solely to a payment of money for his shares.” Id. at 307. Licht cannot benefit from this doctrine because he has not alleged any merger, nor has he alleged that he is being forced to sell his Simulated stock as a result of any merger

. Therefore, the “forced seller doctrine” is irrelevant here.
B. RICO CLAIMS We next conside r the district court’s finding that Licht’s RICO claims are barred by the Private Securities Litigation Reform Act (PSLRA). Licht argues that the district court mistakenly viewed his RICO claims as predicated on acts of securities fraud instead of a complex scheme based on a variety of different acts,

Case: 13-14249 Date Filed: 05/22/2014 Page: 8 of 149 circumstances, and fraud. Licht also argues that his RICO claims do not rely on securities fraud but rather the defendants’ inflated marketing campaigns, press releases, interviews, false valuations, and activity reports. As a result, Licht argues that the PSLRA does not bar his RICO claims. The PSLRA provides that “no person may rely upon any conduct that would have been actionable as fraud in the purchase or sale of securities to establish a viola tion” of RICO, unless the person who committed the fraud has been criminally convicted. 18 U.S.C. § 1964(c). As a result, courts have applied the RICO bar in § 1964(c) broadly, regardless of whether the plaintiff explicitly relied
upon securities fraud a s a predicate act or even had standing to pursue a securities fraud claim

. See , e.g. , Bald Eagle Area School Dist. v. Keystone Fin., Inc. , 189 F.3d 321, 331 (3d Cir. 1999) (“[A] plaintiff cannot avoid the RICO Amendment’s bar by pleading mail fraud, wire fraud and bank fraud as predicate offenses in a civil RICO action if the conduct giving rise to those predicate offenses amounts to securities fraud.”); MLSMK In v. Co. v. JP Morgan Chase & Co. , 651 F.3d 268, 277 (2d Cir. 2011) (holding that the PSLRA bar applies “even where a plaintiff cannot itself pursue a securities fraud action against the defendant”); Howard v. Am. Online Inc. , 208 F .3d 741, 749 (9th Cir. 200 0) (holding that the RICO bar applies even where the plaintiff does not have standing to sue under securities laws because the plaintiff did not buy or sell securities).

Case: 13-14249 Date Filed: 05/22/2014 Page: 9 of 1410 With these principles in mind, the district court properly dismissed Licht’s RICO cla ims because they are based on predicate acts of securities fraud

. Licht’s RICO claims allege that the defendants “engaged in ‘racketeering activity’ by actively participating, among others, in the activity of ‘fraud in the sale of securities.’” Although Licht alleges that the defendants also engaged in wire fraud and mail fraud, this conduct was in furtherance of the defendants’ overarching scheme to commit securities fraud

. See United States v. Stanley , 739 F.3d 633 (11th Cir. 2014) (affirming conviction for violation of securities laws where defendants engaged in a similar pump

- and

- dump scheme); SEC v. Diversified Corp. Consulting Grp. , 378 F.3d 1219 (11th Cir. 2004) (affirming judgment in favor of the SEC in a civil enforcement action for violation of securities fraud laws where defendants engaged in a similar pump

- and

- dump scheme). As a result, the district court properly dismissed Licht’s RICO claims because they rely on predicate acts barred by the PLSRA

. C. LEAVE TO AMEND Licht next argues that the district court erred by dismissing his complaint without giving him an opportunity to amend. He emphasizes that his pleadings must be liberally construed because he is a pro se litigant. He further contends that he can still allege a set of facts that would entitle him to relief

.

Case: 13-14249 Date Filed: 05/22/2014 Page: 10 of 1411 Federal Rule of Civil Procedure 15(a) (1) states that “[a] party may amend the party’s pleading once as a matter of course” within 21 days after serving it, or after the earlier of service of any responsive pleading or service of a Rule 12(b) motion. I n all other cases , however, a party may amen d its pleading only by leave of the court or by written consent of the adverse party. Fed. R. Civ. P. 15(a)(1), (a)(2). The district court “should freely give leave when justice so requires.” Id. 15 (a)(2)

. However, where a more carefully drafted compla int could not state a claim and amendment would be futile, dismissal with prejudice is proper. See Cockrell , 510 F.3d at 1310.
W e agree with the district c ourt that it was appropriate to dismiss Licht’s claims with prejudice . As we have said , the district c ourt correctly dismissed Licht’s claims under the Securities Act and the Securities Exchange Act because he failed to allege that he was a purchaser or seller of securities

. See supra , Section II.A

. Before the district court dismissed these cla ims, Licht never sought leave to amend his pleadings to cure this defect. Even now, Licht does not argue that he was a purchaser or seller of securities in connection with the defendants’ conduct

. Instead, Licht argues for a more expansive legal standard that woul d confer standing upon him as an officer of Simulated and a shareholder of Simulated s tock who was harmed by the defendants’ conduct. Based on this

Case: 13-14249 Date Filed: 05/22/2014 Page: 11 of 1412 record , we cannot say that the district court abused its discretion in denying leave to amend Lic ht’s claims under the Securities Act and the Securities Exchange Act. In the same way, t he district court properly found that amendment of Li cht’s RICO claims would be futile because the heart of his complaint is a pump - and

dump scheme that is “ actiona ble as fraud in the purchase or sale of securities , ” 18 U.S.C. § 1964(c). See supra , Section II.B

. Because t he PSLRA bars this type of securities fraud from serving as a predicate act for RICO, the district court correctly found that amendment would be futile

. Additionally, Licht did not file any motion with the district court suggesting he would be able to allege any RICO predicate acts tha t woul d not be barred by the PSL RA

. See Long v. Satz , 181 F.3d 1275, 1279 (11th Cir. 1999) (per curiam) (“A motion for leave to amend should either set forth the substance of the proposed amendment or attach a copy of the proposed amendment.”). As a result, we conclude that the district court did not abuse its discretion in denying Licht’s RICO claims with out granting leave to amend

. D. DISMISSAL AS AGAINST ALL DEFENDANTS Finally, Licht argues that the district court erred in dismissing claims against defendants who did not file motions to dismiss. As discussed above, however, Licht’s failure to allege that he was a purchaser or seller of securities meant that he could not invoke the court’s su bject matter jurisdiction under the Securities Act

Case: 13-14249 Date Filed: 05/22/2014 Page: 12 of 1413 and the Securities Exchange Act

. Once the district court found that it lacked jurisdiction over these claims, it was required to dismiss them regardless of which defendants had filed motions to dismiss. See Univ. of S. Ala. v . Am. Tobacco Co. , 168 F.3d 405, 410 (11th Cir. 1999) (“Simply put, once a federal court determines that it is without subject matter jurisdiction, the co urt is powerless to continue.”). As for Licht’s RI CO claims, the district cour t’s actions constituted a dismissal of the non

- movant defendants on its own motion for failure to state a claim

. “A district court can only dismiss an action on its own motion as long as the procedure employed is fair.” Tazoe v. Airbus S.A.S. , 631 F.3d 1321, 1336 (11th Cir. 2011) (quotation marks omitted). To employ fair procedure, a district court must generally “provide the plaintiff with notice of its intent to dismiss or an opportunity to respond.” Am . United Life Ins. Co. v. Martinez , 480 F.3d 104 3, 1057 (11th Cir. 2007) (citing Jefferson Fourteenth Assocs. v . Wometco de P.R.,
Inc. , 695 F.2d 524, 527 (11th Cir. 1983). In this case, the district court employed a fair procedure because Licht had a full and fair opportunity to argue that his RICO cla ims were not barred by the P SL RA. Indeed, Licht pressed this argument in his response to the defendants’ motions to dismiss. Therefore , it was not error in these

Case: 13-14249 Date Filed: 05/22/2014 Page: 13 of 1414 circumstances for the district court to dismiss Licht’s RICO claims against all the

non - movant defendants

. 2
III. CONCLUSION For these reasons , we affirm. AFFIRMED.

2 To the extent that Licht challenge s the district court’s dismissal of his state law claims, the argument is unavailing . A district court has discretion not to exercise supplemental jurisdiction over state law claims after it has dismissed all claims over which it had original jurisdiction. Parker v. Scrap Metal Processors, Inc. , 468 F.3d 733, 743 (11th Cir. 2006).

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