Opinion ID: 1267160
Heading Depth: 4
Heading Rank: 1

Heading: UHG Dispute

Text: In order to recover under § 10(b) and Rule 10b-5, a plaintiff must show both an omission or misstatement and its materiality. Zaluski, 527 F.3d at 571. Materiality can be established by proof of a substantial likelihood that the disclosure of the omitted fact would have been viewed by the reasonable investor as having significantly altered the `total mix' of information made available. Id. (quoting Basic Inc. v. Levinson, 485 U.S. 224, 240, 108 S.Ct. 978, 99 L.Ed.2d 194 (1988)). When a company chooses to speak, it must provide complete and non-misleading information. Rubin v. Schottenstein, Zox & Dunn, 143 F.3d 263, 268 (6th Cir.1998). However, liability does not attach to mere corporate puffery or statements of corporate optimism. In re Ford Motor Co. Sec. Litig., 381 F.3d 563, 570 (6th Cir.2004). Further, a safe-harbor excuses liability for defendants' projections, statements of plans and objectives, and estimates of future economic performance. Helwig v. Vencor, Inc., 251 F.3d 540, 547-48 (6th Cir.2001) (en banc) (citing 15 U.S.C. § 78u-5(i)(1)). This protection is overcome only if the statement was material; if defendants had actual knowledge that it was false or misleading; and if the statement was not identified as `forward-looking' or lacked meaningful cautionary statements. Id. at 548 (citing 15 U.S.C. § 78u-5(c)(1)). With regard to the UHG dispute, Plaintiffs do not explain why, as a general matter, Omnicare had a duty to disclose its contractual dispute with UHG any earlier than it did. Rather, Plaintiffs focus on a statement made by Gemunder on two occasions: Omnicare's revenue and earnings growth outlook remains positive given our strong underlying fundamentals and our proven growth strategy. According to Plaintiffs, this predictive statement was misleading absent disclosure of the contract dispute. The problem with this argument, however, is that Gemunder's comments are forward-looking statements entitled to safe-harbor protection. Indeed, not only does the statement itself call attention to its predictive character (growth outlook) but even the complaint identifies it as a positive outlook on future revenue. Further, to the extent that the reference to the outlook remaining positive implies some present circumstances, that is not enough to take this statement out of the safe harbor. See Miller v. Champion Enterprises Inc., 346 F.3d 660, 676-77 (6th Cir. 2003) (relying on 15 U.S.C. § 78u-5(i)(1)(D) and finding reference to use of term continuation in phrase continuation of outstanding earnings growth did not transform an otherwise forward-looking prediction into an unprotected mixed statement). Even putting that exception aside, Gemunder's statements cannot be deemed material. Courts have consistently found immaterial a certain kind of rosy affirmation commonly heard from corporate managers and numbingly familiar to the marketplaceloosely optimistic statements that are so vague, so lacking in specificity, or so clearly constituting the opinions of the speaker, that no reasonable investor could find them important.... In re Ford Motor Co. Sec. Litig., Class Action, 381 F.3d 563, 570-71 (6th Cir.2004) (quoting Shaw v. Digital Equip. Corp., 82 F.3d 1194, 1217 (1st Cir.1996)). Gemunder's comments fall squarely within this realm of corporate puffery, as they do nothing more than vaguely predict positive future results, a claim so banal and ubiquitous that it cannot engender reliance by reasonable investors. See San Leandro Emergency Med. Group Profit Sharing Plan v. Philip Morris Cos., 75 F.3d 801, 811 (2d Cir.1996) (statements of optimism about earnings and claim predicting income growth consistent with ... historically superior performance were puffery). Therefore, we find that the complaint fails to allege a material misstatement or omission. [5]