17-3293-cv In re Barclays Bank PLC Securities Litigation

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT



### SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AN D THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILE D WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN EL ECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING TO A SU MMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
At a stated term of the United States Court of Appeals for the Seco nd Circuit, held at the Thurgood Marshall United States Courthou se, 40 Foley Square, in the City of New York, on the 19 th day of November, two thousand eighteen.

PRESENT: P IERRE N. L EVAL , S USAN L. C ARNEY , Circuit Judges
, K

ATHERINE P OLK F AILLA , District Judge. *

________________ _______________
I N RE : B ARCLAYS B ANK PLC S ECURITIES L ITIGATION

________________ _______________
No. 17-3293-cv

D ENNIS A SKELSON , Plaintiff-Appellant
,
M ARSHALL F REIDUS , on behalf of himself and all others similarly situated, S TEWART T HOMPSON AND S HARON T HOMPSON , Trustees for the S.O. Thompson Rev. Trust and the S.G. Thompson Rev. Trust, D ORA L. M AHBOUBI , L ARRY M ORRISON , individually and on behalf of all others similarly situated, J EFFREY L EFCOURT , on behalf of himself and all

* Judge Katherine Polk Failla, of the United States Dist rict Court for the Southern District of New York, sitting by designation.2 others similarly situated, B EVERLY P ELLEGRINI , on behalf of herself and all others similarly situated, and A LFRED F AIT , on behalf of himself and all others similarly situated,
Plaintiffs
,

v.

B ARCLAYS B ANK PLC, B ARCLAYS PLC, J OHN S ILVESTER V ARLEY , R OBERT E DWARD D IAMOND , J R ., S IR R ICHARD B ROADBENT , R ICHARD L EIGH C LIFFORD , D AME S ANDRA J.N. D AWSON , S IR A NDREW L IKIERMAN , S IR N IGEL R UDD , S TEPHEN G EORGE R USSELL , J OHN M ICHAEL S UNDERLAND , B ARCLAYS C APITAL S ECURITIES L IMITED , C ITIGROUP G LOBAL M ARKETS , I NC ., M ERRILL L YNCH , P IERCE , F ENNER , & S MITH I NCORPORATED , W ACHOVIA C APITAL M ARKETS , LLC, M ORGAN S TANLEY & C O

. LLC, UBS S ECURITIES LLC, RBC D AIN R AUSCHER , I NC ., M ARCUS A GIUS , C HRISTOPHER L UCAS , G ARY A. H OFFMAN , F REDERIK S EEGERS , D AVID G. B OOTH , F ULVIO C ONTI , D ANIEL C RONJE , B ANC OF A MERICA S ECURITIES , LLC,
Defendants-Appellees,

M ATTHEW W ILLIAM B ARRETT , N AGUIB K HERAJ , A.G. E DWARDS & S ONS , I NC ., BNP P ARIBAS S ECURITIES C ORP ., G OLDMAN , S ACHS & C O ., K EY B ANC C APITAL M ARKETS I NC ., S UNTRUST C APITAL M ARKETS , I NC ., W ELLS F ARGO S ECURITIES , LLC,
Defendants.

___ ______ ___________________ _____________________ _____________________ FOR APPELLANT: J OSEPH D. D ALEY (Lucas F. Olts, on the brief ), Robbins Geller Rudman & Dowd LLP, San Diego, CA.
Andrew L. Zivitz, Sh aran Nirmul, Richard A. Russo, Jr., Kessler Topaz Meltzer and Check, LLP, Radnor, PA.

FOR APPELLEES: M ICHAEL T. T OMAINO , J R

. (Thomas C. White, on the brief ), Sullivan & Cromwell LLP, New York, NY.
Appeal from a judgment of the United States District Court for th e Southern District of New York (Crotty, J. ).3 UPON DUE CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the judgment entered on September 14, 2017, is
AFFIRMED.
Plaintiff-Appellant Dennis Askelson, pro ceeding on behalf of a certified investor class, appeals from a judgment of the United St ates District Court for the Southern District of New York (Crotty, J. ), granting summary judgment on his claims arising under sections 11 and 15 of the Securities Act of 1933, 15 U.S.C. §§ 77k, 77o. Askelson sought relief on behalf of purchasers of Barclays Bank PLC’s Apr il 8, 2008 Series 5 offering of American Depositary Shares (“ADS”), alleging that those s ecurities were issued pursuant to materially false and misleading “Offering Materials.” 1 Defendants-Appellees are Barclays Bank PLC, its holding company Barclays PLC, and a numb er of Barclays directors and executives (collectively, “Barclays”), toge ther with the several investme nt banks that underwrote the April 2008 offering (the “Underwriters”). 2
On appeal, Askelson contends that Barcla ys violated section 11 principally through
two material omissions in connect ion with its April 8, 2008 offe ring (the “Offering”). First, he argues, Barclays “hid” its exposure to billi ons of dollars in risky assets by failing to disclose in its Offering Materials the notional amount of its exposure to monoline insurers. App’t Br. 35–43. Second, he asserts, Barclays faile d to disclose that it had become subject to an allegedly ongoing “directive” from the Unit ed Kingdom’s Financial Services Authority to maintain a Tier 1 Equity ratio above a threshold of 5.25%. Id. at 44–49. A branch of this second theory rests on Barclays’ additional failur e to divulge to investors that it experienced a marked decline in its capital ratios during the first quarter of 2008—that is, between December 31, 2007, and the Offeri ng date of April 8, 2008. As kelson’s claims under section

1 The Offering Materials at issue in this case are: (1) an August 31, 2007 shelf registration statement and prospectus; (2) an April 8, 2008 prospectus supplement; and (3) Barclays’ Form 20-F annual report for fiscal year 2007, dated March 26, 2008, which was incorporated by reference in to the prospect us supplement.

2 The credit market assets at issue here were held by Barclays Capital, a New Yo rk-based investment banking division of Barclays. It is to be distinguished from Defendant-Appellee Barclays Capital Securities Limited, which the Second Consolidated Amende d Complaint calls “Barclays Securities” and describes as a separate entity that was one of the Offering’s underwriters. J. App’x 79, ¶ 46.4 15 of the Securities Act, which provides for in dividual liability for “controlling persons,” are
derivative of his section 11 claims.
We assume the parties’ familiarity with the underlying facts, procedural history, and arguments on appeal, to which we refer only as necessary to ex plain our decision to affirm.

I.

We review de novo a district court’s grant of summary judgment. Dalberth v. Xerox Corp. , 766 F.3d 172, 182 (2d Cir. 2014). Summa ry judgment is appropriate only “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). An issue of fact is genuine “if the evidence is such that a reasonable ju ry could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In our review, we “construe the evidence in the light most favorable to the nonmoving party and draw all inferences and resolve all ambiguities in favor of the nonmoving party.” In re Omnicom Grp., Inc. Sec. Litig., 597 F.3d 501, 509 (2d Cir. 2010) (alterations omitted).
Section 11 of the Securities Act of 1933 prov ides securities purchasers a private right of action if any part of a registration statement, when it became effective, “contained an
untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statement ther ein not misleading.” 15 U.S.C. § 77k(a). A plaintiff proceeding under section 11 must estab lish one of three bases of liability: “(1) a material misrepresentation; (2) a material omi ssion in contravention of an affirmative legal disclosure obligation; or (3) a material omissi on of information that is necessary to prevent existing disclosures from being misleading.” Hutchison v. Deutsche Bank Sec. Inc. , 647 F.3d 479, 484 (2d Cir. 2011).

As we described in Hutchison , to be actionable under section 11, any misrepresentation or omission must be material . Materiality is an “inherently fact-specific finding.” Basic Inc. v. Levinson , 485 U.S. 224, 236 (1988). It is established when a plaintiff
demonstrates that there is a “substantial likeli hood that the disclosure of the omitted fact would have been viewed by the reasonable invest or as having significantly altered the ‘total5 mix’ of information made available.” Ganino v. Citizens Utils. Co. , 228 F.3d 154, 162 (2d Cir. 2000) (quoting Basic , 485 U.S. at 231–32).
Unlike a securities fraud plaintiff proceed ing under section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), a section 11 plaintiff need not demonstrate “scienter, reliance, or loss causation.” In re Morgan Stanley Info. Fund Sec. Litig. , 592 F.3d 347, 359 (2d Cir. 2010). Nevertheless, a defendant in a section 11 action will not be liable if it can prove “negative loss causation”—that is, if it can demonstrate that the alleged misstatement or omission did not lead to a decline in its share price. See 15 U.S.C. § 77k(e) (“[I]f the defendant proves that any portion or all of such damages represents other than the depreciation in value of such security resultin g from [the alleged misstatement or omission], such portion of or all such damages shall not be recoverable.”). To sustain this defense, a
defendant must establish that “the risk that caus ed the losses was not wi thin the zone of risk concealed by the misrepresentations and om issions,” or that “the subject of the
misstatements and omissions was not the cause of the actual loss suffered.” Fed. Hous. Fin. Agency v. Nomura Holding Am., Inc. , 873 F.3d 85, 154 (2d Cir. 2017) (alterations and internal quotation marks omitted). Because section 11 “a llocate[s] the risk of uncertainty to the defendants,” we have described rebutti ng loss causation as a “heavy burden.” Akerman v. Oryx Commc’ns, Inc. , 810 F.2d 336, 341 (2d Cir. 1987).

II.
Askelson’s first theory on appeal relates to Barclays’ failure to disclose the notional amount of its exposure to monoline insurers (“monolines”) before th e April 2008 Offering. Monolines are companies whose sole business it is to issue financial guaranty insurance instruments, the most well-know n of which are credit-default swaps. Credit default swaps operate as follows, with some simplification: in exchange for regular payments, a monoline selling credit default swap protection assumes th e risk that an insured financial asset will default. If the underlying asset does not default, the monoline profits from the payments, which are calibrated to the perceived risk presen ted by the asset at the time of contract. If the underlying asset does default before the credit default sw ap contract expires, however, the monoline is typically responsible for the losse s on the insured asset up to the total value of6 the security (or another amount established by contract). While mo nolines historically insured relatively low-risk assets such as muni cipal bonds, in recent decades they began to insure increasingly risky financial products , including, as relevant here, mortgage-backed securities (“MBS”), collateralized debt obligations (“CDOs”), and other asset-backed securities (“ABS”).
Barclays’ Form 20-F—issued on March 26, 2008, and covering the year ending December 31, 2007—reported certain information related to “Barclays Capital[’s] credit market positions.” Supp. App’x 3933. After disclo sing that Barclays Capital experienced “net losses of £1,635 million in 2007, due to dislocat ions in the credit mark ets,” it presented in chart form data showing Barclays Capital’ s exposure to various types of securities. Id. The chart shows that, as of December 31, 2007, Barc lays Capital had £6,018 million in exposure to “ABS CDO Super Senior” securities. It fu rther reflects that, when expressed net of hedges (which it valued at £1,347 million), it had an exposure of £4,671 million to the ABS CDO Super Senior securities. Id. In its Form 20-F, Barclays also affirmatively represented that “[n]one of the above hedges of ABS CD O Super Senior exposures as at 31st December 2007 were held with monoline insurer counterparties.” Id.
The chart additionally inform s the reader that, as of December 31, 2007, Barclays Capital’s exposure to monoline insurers was £1,335 million—an almo st tenfold increase from the £140 million exposure reported as of June 30, 2007, six months earlier. 3 Id. Commentary accompanying the chart explains that “Barclays Capital held assets with insurance protection or other credit enhancemen t from monoline insurers. . . . There were
no claims due under these contracts as none of the underlying assets were in default.” Id.
What Barclays failed to disclose in it s Form 20-F, however, and what Askelson focuses on, is the “notional amount” or “notio nal value” of Barclays Capital’s exposure to

3 Askelson’s expert, Fiachra O’Driscoll, stated that Barclays’ chart reflected its “current exposure” to monolines, which he acknowledges to be a legitimate measure, albeit one calculated by the method that produces the lowest exposure figures. Supp. App’x 2124. According to Barclays, the figures were derived by assessing the declines in value (from par) of the insu red assets to arrive at an insurance value, and then reducing that amount further by a credit valuation allowance. The credit valuation allowance was a writedown intended to reflect credit risk as to the monoline insurers themselves. Appellees’ Br. 12 n.7.7 the monolines. In this context, “notional value” refers to th e figure used in the monoline contracts to quantify the full face amount of the credit default swaps (or other credit arrangements) held with the monolines—that is , the total amount that monolines would owe Barclays in the event that all of the underlying assets defaulted.
As of December 31, 2007, the notional value of Barclays Capital’s assets that were insured by monolines was £21,573 million, over sixteen times the exposure of £1,335 million that was reported by Barclays for that date in its Form 20-F. Askelson contends that Barclays’ failure to disclose this £21,573 mi llion figure was misleading in two ways. 4 First, he says the omission permitted Barclays to “use[] it s exposure to highly risky monoline insurers as a means to hide £22 billion in risky credit-m arket assets from investors.” App’t Br. 13. In other words, according to Askelson, by revealing only its measure of the value of its current exposure to monoline insurers—but omitting th e notional value, asset class, and risk profile of the underlying assets insured by the monoli nes—Barclays “understated its actual creditmarket exposure by nearly 40% and disclose d less than half of its ABS CDO positions.” Id. at 37. Second, Askelson maintains that Barclays’ “selective” disclosure, id. , failed to alert investors to its actual potential exposure to the monolines themselves—and therefore to its potential losses should the mono lines default and be unable to cover their credit default swaps, as indeed occurred with several of Barc lays’ monoline counterparties, albeit largely well after September 2008.

The District Court ruled that Askelson has not established these omissions as a basis for recovery for two reasons: first, because as a matter of law Barclays had no duty to
disclose the notional amount of monoline exposure; and second, because Barclays
demonstrated that the omission did not cause Askelson’s subsequent losses. As set forth

4 Askelson also argues that Barclays’ statement in its Form 20-F that “[n]one of the above hedges of ABS CDO Super Senior exposures as at 31st December 2007 we re held with monoline in surer counterparties” is itself materially misleading because, in fact, Barclays held additional undisclosed ABS CD O positions insured by monolines. As the District Court correctly found, however, the text’s reference to “the above hedges,” when considered in context, left no doubt that the instant statement app lied only to the specific line item in the chart immediately above it and could not reasonably be construed as an affirmative assertion by Barclays that it had no ABS CDO positions insured by monolines.8 below, we disagree with the District Court’s fi rst conclusion, but identify no error in its dispositive analysis of the second: Barclays ’ conclusive proof regarding negative loss
causation.
In holding that, as a matter of law, Barclays bore no duty to disclose the notional amount of its monoline exposure, the Dist rict Court relied on our recent decision in IBEW Local Union No. 58 Pension Tr. Fund & Annuity Fund v. Royal Bank of Scotland Grp., PLC , 783 F.3d 383 (2d Cir. 2015) (“ RBS ”). In RBS , we affirmed a district court’s Rule 12(b)(6) dismissal of a complaint alleging securities fraud under section 10(b) of the Securities Exchange Act, where plaintiffs alleged (among other theories of recovery) that RBS had wrongfully “failed to disclose $6.8 billion in subprime ex posures and $14. 1 billion in exposure to monoline insurers.” Id. at 390. While our discussion there focused on materiality, we observed an addi tional shortcoming of plaintiffs’ complaint: they “fail[ed] to explain how the $14.1 billion [in exposure to ] monoline insurers constitute subprime exposures or that RBS had an ob ligation to disclose them as U. S. subprime exposures ‘net of hedges.’” Id. at 391–92.

This observation should not be read to set fo rth a categorical rule that an issuer will

never have a duty under section 11 to disclose the notional amount of its exposure to monoline insurers. Instead, the statement has a much narrower import: in the context of a motion to dismiss an action brought under section 10(b), we found wanting plaintiffs’ pleadings in support of the claimed inferen ce that RBS had any obligation to report its exposures to monoline insurers under the broader rubric of “Total U.S. subprime exposures.” Id. This was a ruling heavily limited by c ontext. Rather than relying on fixed rules as to which categories of information are subject to disclosure under section 11, courts must consider each claim on a case-by-case ba sis and determine whether, in the totality of the circumstances, the allegedly omitted disc losure was “necessary to prevent existing disclosures from being misleading.” Hutchison , 647 F.3d at 484; see also Meyer v. Jinkosolar Holdings Co. , 761 F.3d 245, 250 (2d Ci r. 2014) (“[O]nce a company speaks on an issue or topic, there is a duty to tell the whole truth.”); Caiola v. Citibank, N.A. , 295 F.3d 312, 331 (2d9 Cir. 2002) (“[T]he lack of an independent duty is not . . . a defense to . . . liability because upon choosing to speak, one must speak tr uthfully about material issues.”).
We need not pursue the issue further in this case, in any event, because, whether or not Barclays might have had such a duty here, we agree with the District Court that Barclays resoundingly established its affirmative defense of negative loss causation as to this theory of liability, entitling it to summary judgment in its favor.
In support of its negative loss causation defe nse, Barclays relied on the analysis of its expert, Dr. Allan W. Kleidon. 5 Dr. Kleidon conducte d an “event study” with respect to the price of Barclays’ Series 5 ADS shares during the period between April 8, 2008, and March 24, 2009. An event study is an empirical statistical analysis by which experts may “disentangle[] the effects of two types of info rmation on stock prices—information that is specific to the firm under questi on . . . and information that is likely to affect stock prices
marketwide.” In re Vivendi
, S.A. Sec. Litig. , 838 F.3d 223, 253 (2d Cir. 2016) (quoting Mark L. Mitchell & Jeffry M. Netter, The Role of Financial Economics in Securities Fraud Cases: Applications at the Securities & Exchange Commission , 49 Bus. Law. 545, 556–57 (1994)). Such a study allows an expert “to make inferences about the de gree to which the company’s stock price may have been artificially inflated on the basis of the market’s misconception as to the truth prior
to the release of that information.” Id. at 253–54. In his event study, after controlling for market and industry effects, Dr. Kleidon calc ulated Barclays’ “residual returns”—changes in stock price that cannot be explained by general market forces—and opined as follows about their statistical significance at a 95% confidence interval.

5 On appeal, Askelson challenges the District Court’s denial of his motion under Federal Rule of Evidence 702 and Daubert v. Merrell Dow Pharm., Inc. , 509 U.S. 579 (1993), to exclude Dr. Kleidon’s expert report. In the alternative, he contends that the District Court erred by relying on Dr. Kleidon’s report in granting summary judgment. We review for abuse of discretion a district court’s determination to admit expert testimony. Amorgianos v. Nat’l R.R. Passenger Corp. , 303 F.3d 256, 264 (2d Cir. 2002). Substantially for the reasons stated by the District Court in it s summary judgment opinion, see In re Barclays Bank PLC Sec. Litig. , No. 09-CV-1989 (PAC), 2017 WL 4082305, at *21–25 (S.D.N.Y. Sept. 13, 2017) , we conclude that Dr. Kleidon’s report and event study are based on “reliable principles and method s” and would “help the trier of fact to understand the evidence or to determine a fact in issue.” Fed. R. Evid. 702. We ther efore rule that the District Court did not err by admitting Dr. Kleidon’s report and relying on it, in part, in its aw ard of summary judgment.10 On August 7, 2008, Barclays issued a Form 6-K announcing its interim results for the period ending June 30, 2008. In its Form 6-K, Barclays disc losed all the information that Askelson contends was wrongfu lly omitted from its March 26, 2008 Form 20-F, including the notional amount of its exposure to monolin e insurers, disaggregated by type of asset and credit rating of the monoline insurers in question, as of both December 31, 2007, and June 30, 2008. The Form 6-K disclosure revealed that Barclays’ net current exposure to
monolines almost doubled between those date s, growing from £1,335 million on December 31, 2007, to £2,584 mill ion on June 30, 2008, largely because (as the Form reflects) of a corresponding decline in the fair value of the underlying assets.
After the release of its Form 6-K, which thus remedied the charged omission, the share price of the Series 5 ADS shares decrea sed marginally, falling from $24.69 on August 6, 2008, to $24.46 on August 7, 2008, marking a loss of $0.23 per share. According to Dr. Kleidon, the related residual return had no stat istical significance. Indeed, even a layperson’s review of the Series 5 ADS share prices duri ng the three weeks foll owing the disclosure reveals no significant movements in response to the remedial disclosure, and only minor variations in share value above $24.00. Indeed, on one day during this period, the share price actually exceeded the pre-disclosure price.

The same minor fluctuations are reflected in the residual returns calculated by Dr. Kleidon for the relevant period. Thus, simply put, the evidence shows virtually no market reaction—and certainly no statistically signific ant market reaction—to the revelation of over £21 billion of what Askelson ch aracterizes as “hidden” assets.

Askelson does not rebut Dr. Kleidon’s anal ysis. Rather, he tries to explain this apparent lack of market reaction by respondin g that the August 7, 2008 disclosure was not “fully corrective” of the charged omissions beca use it “did not reveal that the monolines had
insured previously undisclosed credit-market assets that were in addition to —and therefore omitted from—the £37.8 billion credit -market positions represented in the Offering Materials.” App’t Br. 68. In other words, Askelson conten ds that a reasonable investor might believe that, instead of providing further informati on about the assets underlying Barclays’ £1,335 million net current exposure to monoline insurers (as of Decem ber 31, 2007), the £21 billion11 in notional assets identi fied in the Form 6-K could refer to some other portion of the assets already disclosed in the Form 20- F. We do not think that an investor could reasonably draw
this conclusion.
The August 2008 Form 6-K includes a chart of Barclays Capital’s estimates of its credit market exposure as of three dates: Ju ne 30, 2007, December 31, 2007, and June 30, 2008. The Form 6-K chart provides only one line reporting the three values for Barclays’ then-current exposure to the monolines. It shows that, as of December 31, 2007, that amount was £1,335 million—the same figure pr ovided as of that date in the “Barclays Capital credit market position” chart that a ppears in the Form 20-F issued in March 2008. Supp. App’x 4634. The Form 6-K chart then poi nts the reader to note “D,” which is an explanatory note explicitly associated with the “monoline insurers” line on the chart. Id. Note D, in turn, identifies the same net exposure (£1,335 million) as shown in both the primary chart and the March 2008 Form 20-F. Note D next provides both the notional and fair values of the assets that underlay the calculated £1,335 million net exposure—
information that was not previously disclosed in the Form 20-F. Id. at 4638. Indeed, that detailed information is precisely what Askelson alleges was earlier “hidden” from the market.
The structure of the August 2008 Form 6-K—that is, an informational chart accompanied by detailed explanatory notes—d emonstrates that Barclay’s disclosure of notional amounts in Note D was intended to (a nd did) provide furthe r disaggregation related
to information shown on the “monoline insurer s” line on the chart; it did not refer to data on other lines on the chart or to assets not repr esented in the chart at all. Because the value of the “monoline insurers” line (as of Decembe r 31, 2007) is identical in both the March 2008 Form 20-F and the August 2008 Form 6-K, Ba rclays’ additional disaggregation in Note D unmistakably referred to this line only . Since Barclays provided no such disaggregation in its earlier-issued Form 20-F, any reasonable investor would conclude that the notional amounts reported in the Form 6-K were “in ad dition to . . . the credit-market positions represented in the Offering Materials,” cont rary to Askelson’s assertion. App’t Br. 68.
Our conclusion that the Augu st 7, 2008 Form 6-K disclo sure was fully corrective as
to Askelson’s monoline insurer non-disclosure theory means that we need not consider12 whether additional allegedly corr ective information may have emerged at any later date. Nor need we determine the adequacy of Dr. Kleidon’ s event study for other dates after August 7, 2008, but before March 24, 2009, when Barcla ys released its Form 20-F for fiscal year 2008. See Akerman, 810 F.2d at 343 (affirming grant of summa ry judgment where defendants, by
means of statistical evidence “met their burden . . . by establishing that the misstatement was barely material and that the public failed to react adversely to its disclosure”). On de novo review, we conclude as a matter of law that, on this record, Barclays has satisfied its negative causation burden regarding this theory of section 11 liability. 6

III.
Askelson’s second main theory on appe al relates to a purported “mandate” or “directive” issued by the Financial Servi ces Authority (“FSA”)—the United Kingdom regulatory body tasked at the ti me with regulating financial se rvices markets—to Barclays to maintain a “Tier 1 Equity Ratio” of over 5.25%. 7 The factual predicate for this theory lies largely in two meetings, both held on or ar ound March 8, 2008, between the FSA’s thenChariman Callum McCarthy and Barclays Chai rman Marcus Agius. Agius’s notes on these meetings were circulated to Barclays’ Board of Directors and were part of the summary judgment record.
The notes reflect Agius’s impression that the FSA Chairman “wan t[ed] to be clear as to [Barclays’] contingency plans for raising ne w equity capital should there be a further

6 To the extent that Askelson conten ds that, at the time of the April 20 08 Offering, the £1,335 million figure for Barclays’ exposure to the monolines was “stale” an d therefore misleading, App’t Br. 20, Barclays has established its negative loss causation de fense as to this theory as well. On May 15, 2008, Barclays released a Form 6-K disclosing its interim resu lts for the first quarter of 2008, with figures as of March 31, 2008—only a week before the offering. The May issuance showed that Barclays’ exposure to monoline insurers more than doubled to £2,784 million, and in it Ba rclays stated that this doubling occu rred because “[a]s the value of the underlying assets fell, the market value of the contra cts, and hence Barclays Capital exposure, rose.” Supp. App’x 1933. On the day of this disclosure , the price of the Se ries 5 ADS shares rose by $0.06, from $25.17 on May 14, 2008, to $25.23 on May 15, 2008.

7 A bank’s Tier 1 Equity ratio is calculated by dividing stockholders’ equity by the value of a bank’s riskweighted assets. Supp. App’x 3763–64. Risk weights are dete rmined by asset class, as well as the credit rating of a given security within the asset class. Id. at 3763. The riskier the asset, the higher the risk-weight that is assigned it—consequently, in riskier environments, th e valuation of risk-weighted assets tends to rise, therefore causing the Tier 1 Equity ratio to fall. Id. at 3764.13 precipitate fall in asset values.” Supp. App’x 228, ¶ 348. McCarthy “expressed particular concern that our Tier 1 equity ratio is only 4. 6 per cent (as compared to our own figure of 5 percent) and, he believes, is only forecast to be at or above our target of 5.25 per cent in 2 of
the next 24 months.” Id. Agius’s notes describe the FSA Chairman as using a “sharp” tone, and record that he referred to Barclays’ equity ratio as “alarming” and st ated that he needed to know “as a matter of urgency” what Barcla ys’ contingency plans were, so that the FSA
could determine whether it “wou ld need to take any action.” Id.
Very shortly after these meetings, Barclays revised its short-term capital plan for 2008. In it, Barclays downgraded its projected Tier 1 Equity ratio for June 2008 from 4.89% to 4.53%, citing “adverse capital movements. ” Supp. App’x 3151–52. The new capital plan left no doubt that Barclays needed either to reduce its risk-weigh ted assets or increase equity in the near future. It identified increasing th e size of the planned April 2008 share offering as one potential means of doing so.
Barclays provided its revised short-term capital plan to the FSA on March 14, 2008. Thereafter, in a March 20, 2008 meeting of Ba rclays’ Board of Directors, Barclays’ Group Finance Director Christopher Lucas explained th at “[t]he indications were that the FSA would wish [Barclays] to achieve its own targ et equity ratio [of 5.25%] before the end of 2008.” Supp. App’x 2860. Lucas accordingly presented various possible means of raising equity and reducing risk-weighted assets. Also on March 20, Barclays’ CEO John Varley prepared a note for Agius to transmit to Chairman McCarthy, referencing Barclays’ “proposals as to our capital plan that are directed at addressing your concerns.” Id. at 3230.
We agree with the District Court that this record presents no genuine dispute of material fact as to the existence of a purported FSA “mandate” or “directive.” The parties agree that, at the relevant time, the United Kingdom’s regulatory minimum Tier 1 Equity ratio was 2%, and that Barclays ’ ratio was well above this mi nimum. There is no document or communication in the record that suggests that the FSA took any formal regulatory action to require Barclays to meet a different stan dard or that Barclays undertook a formal
commitment to do so—much less that the FS A imposed an ongoing mandate that would bind Barclays through 2009. No fact-finde r could reasonably construe a regulator’s14 expressions of concerns about a bank’s financial status and vigorous requests—even if expressed urgently—to be kept apprised of the bank’s contingency plans as a regulatory
“directive” or “mandate” with the force of law. Cf. In re Sanofi Sec. Litig ., 87 F. Supp. 3d 510, 541–42 (S.D.N.Y. 2015) (collect ing cases from pharmaceutical industry and noting that “interim [agency] feedback is not material because it does not reflect a binding agency decision and is subject to chan ge”). Like the District Court, we are persuaded that Barclays had no legal duty to disclose the substance of its March 2008 conversations with the FSA in the Offering Materials.
Finally, Askelson contends that the Offering Materials wrongfully failed to disclose a material decline in Barclays’ capital ratios du ring the first quarter of 2008. He focuses on a decrease of the Tier 1 Equity ratio from 5.1% to 4.34% between December 31, 2007, and the April 2008 Offering. As with his theory rela ting to Barclays’ exposure to the monolines, however, we need not deci de whether Barclays had any duty to disclose such information or
whether the information was material becaus e Barclays has established negative loss
causation as a matter of law.
On June 25, 2008, approximately ten weeks after the Offering, Barclays disclosed an additional £4.5 billion capital raise, which incre ased its Tier 1 capital and equity ratios as of June 30, 2008, to 7.9% and 5.0%, respectively. These ratios were roughly equivalent to those previously reported to investors as of D ecember 31, 2007: those were 7.6% and 5.1%, respectively. Upon the June 25 announcement, th e price of Barclays’ Series 5 ADS shares rose by $0.16, from $24.80 on June 24, 2008, to $24.96 on June 25, 2008. Dr. Kleidon opined that this price movement was associated with a statistically insignificant residual

return. The June 25 disclosure broke any chain of causation that might have existed connecting any failure to report declining capi tal ratios in the months between December 2007 and April 2008, and any losses Askelson may have suffered after June 25, 2008. After the capital raise and updated capital and equity ratios were disclosed in June 2008, investors could not have been prejudi ced by any omission between December 2007 and the Offering in April 2008 to publish declining ratios, and there is no record evidence of any statistically15 significant losses in the price of Series 5 AD S shares occurring in or about June 2008— dramatic losses would come only later, in and after Fall 2008.
Askelson’s only rejoinder to this observati on is (as before) that the capital raise and the revelation of new capital ratios in June were not “fully corrective” of the charged
omissions because the FSA’s “directive” still hu ng like an albatross around Barclays’ neck, requiring it to undertake yet further capital raises so as to maintain the purportedly mandatory 5.25% Tier 1 Equity ratio. App’ t Br. 65–66. For the reasons stated above, however, we conclude that Askelson has not raised a genuine dispute of material fact as to the existence of any FSA “directive,” and ther efore this argument fails. In other words, absent an undisclosed regulatory mandate requi ring Barclays to continue to raise more equity, the June 25, 2008 disclosure of an additional capital raise was fully corrective. Accordingly, because Barclays has conclusive ly proven that “the subject of the . . .
misstatements and omissions was not the cause of [any] actual loss suffered,” Nomura , 873 F.3d at 154 (internal quotation marks omitted) , we affirm the District Court’s grant of summary judgment to Barclays on Askelson’s “m aterial decline in capital ratios” theory as
well.

* * *

We have considered Askelson’s remainin g arguments and conclude that they are without merit. For the reasons set forth above, we decide that Barclays has established that none of Askelson’s claims to recovery under section 11 based on the omissions that he alleges to be wrongful survives summary judgme nt, either because Barclays had no duty to disclose the information Askelson specifies or b ecause Barclays established that the failure to disclose did not cause him to suffer any loss. We therefore affirm the District Court’s grant of Barclays’ motion for summary judgment on Askelson’s claims under section 11 of the
Securities Act.

Because we rule that Askelson’s section 11 cl aims against Barclays fail, we also affirm the District Court’s grant of summary judgment on Askelson’s parallel section 11 claims as to the Underwriters and its grant of summary judgment on Askelson’s section 15 “control16 person liability” claims against the individual defendants associated with Barclays. See Hutchison, 647 F.3d at 490 (“To establish [section] 15 liability, a plaintiff must show a ‘primary violation’ of [s ection] 11 . . . .”).
The District Court’s judgment is AFFIRMED

.
FOR THE COURT: Catherine O’Hagan Wolfe, Clerk of Court