Court Opinion

ID: 2678665
Source: CourtListenerOpinion
Date Created: 2014-06-17 15:00:17.426924+00
Date Added: 2024-06-11T13:10:39.803887
License: Public Domain

13-4048
Golesorkhi v. Green Mountain Coffee, Inc.

                               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 AND THIS COURT’S LOCAL RULE 32.1.1.
WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY
MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE
NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY 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 Second Circuit, held at the
Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of New York on the
17th day of June two thousand fourteen.

Present:    ROSEMARY S. POOLER,
            RAYMOND J. LOHIER, JR.,
                        Circuit Judges.1
_____________________________________________________

KAMBIZ GOLESORKHI, WILLIAM C. DAILEY,

                                  Plaintiffs-Appellants,

STEVE FIFIELD, Individually and on Behalf of All Others
Similarly Situated,

                                  Plaintiff,

                            -v-                                            13-4048-cv

GREEN MOUNTAIN COFFEE ROASTERS, INC., ROBERT P.
STILLER, LAWRENCE J. BLANFORD, FRANCES G. RATHKE,

                        Defendants-Appellees.
_____________________________________________________

Appearing for Appellants:         Kim Miller, Kahn Swick & Foti, LLC (Lewis S. Kahn,

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         Judge Peter W. Hall, a member of the original panel, subsequently recused himself.
Therefore, this case is decided by the two remaining members of the panel pursuant to Internal
Operating Procedure E(b) of the Rules of the United States Court of Appeals for the Second
Circuit.
                                Madisonville, LA, on the brief), New York, N.Y.

Appearing for Appellees:        Randall W. Bodner, Ropes & Gray LLP, Boston, MA (Anne
                                Johnson Palmer, Michael J. Vito, on the brief; Robert B. Luce,
                                Matthew S. Borick, Downs Rachlin Martin PLLC, Burlington, VT,
                                on the brief), for Green Mountain Coffee Roasters, Inc..
                                Robert B. Hemley, Gravel & Shea PC (Matthew B. Byrne, on the
                                brief) Burlington, VT, for Robert P. Stiller, Lawrence J. Blanford
                                and Frances G. Rathke.

        Appeal from the United States District Court for the District of Vermont (Sessions, J.).

     ON CONSIDERATION WHEREOF, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the order of said District Court be and it hereby is AFFIRMED.

         Kambiz Golesorkhi and William Dailey (together, “Plaintiffs”) appeal from the
September 26, 2013 opinion and order of the United States District Court for the District of
Vermont (Sessions, J.), dismissing their putative class action suit on behalf of all those who
purchased common stock of Green Mountain Coffee Roasters, Inc. between February 2, 2012
and May 2, 2012 (the “Class Period”). We assume the parties’ familiarity with the underlying
facts, procedural history, and specification of issues for review.

        The Private Securities Litigation Reform Act (“PSLRA”) imposes a heightened standard
for an allegation to be well pleaded. Plaintiffs must satisfy Rule 9(b), which requires plaintiffs to
state “the circumstances constituting fraud,” and the PSLRA also requires them to “state with
particularity all facts on which [their belief that defendants violated Rule 10(b)(5) ] is formed.”
15 U.S.C. § 78u–4(b)(l)(B). Thus, plaintiffs must plead “sufficient” facts to support a reasonable
belief as to the misleading nature of defendants’ statements or omissions. Novak v. Kasaks, 216
F.3d 300, 313-14 n.1 (2d Cir. 2000). The PSLRA also requires plaintiffs to “state with
particularity facts giving rise to a strong inference that the defendant acted with the required state
of mind,” which focuses attention on the scienter allegations. 15 U.S.C. § 78u–4(b)(2)(A).

        “To state a claim under Rule 10b–5 for misrepresentations, a plaintiff must allege that the
defendant (1) made misstatements or omissions of material fact, (2) with scienter, (3) in
connection with the purchase or sale of securities, (4) upon which the plaintiff relied, and (5) that
the plaintiff’s reliance was the proximate cause of its injury.” ATSI Commc’ns, Inc. v. Shaar
Fund, Ltd., 493 F.3d 87, 105 (2d Cir. 2007). However, the PSLRA provides a safe harbor for
defendants, protecting them from liability when they make forward-looking statements that meet
three “safe harbor” requirements. Slayton v. Am. Express Co., 604 F.3d 758, 766 (2d Cir. 2010)
(“[A] defendant is not liable if the forward-looking statement is identified and accompanied by
meaningful cautionary language or is immaterial or the plaintiff fails to prove that it was made
with actual knowledge that it was false or misleading.”(emphasis in original)).

        We affirm for the substantially the reasons set forth in the district court’s thorough
opinion. We note that even assuming the district court misstated the law when it required
plaintiffs to plead defendants had knowledge of, or access to specific reports that contradicted
their public statements, the district court also rested its findings on the fact that the allegations by

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the confidential witnesses were not sufficiently close in time to the class action period to support
an inference of scienter.

       We have considered the remainder of Plaintiffs’ arguments and find them to be without
merit. Accordingly, the order of the district court hereby is AFFIRMED. Each side to bear its
own costs.

                                                      FOR THE COURT:
                                                      Catherine O’Hagan Wolfe, Clerk

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