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http://nycourts.law.com/CourtDocumentViewer.asp?view=Document&docID=46871 Justice Lehner FIFTY “SAVVY,” “sophisticated” investors sued defendant chief executive officer of a now-bankrupt “dot-com” corporation for misstatements urging plaintiffs to buy additional stock. Defendant’s statements were not accompanied by cautionary warnings and did not advise shareholders that the statements conflicted with Securities and Exchange Commission (SEC) filings. Seeking dismissal, defendant pointed to earnings and proxy statements filed with the SEC. Plaintiffs countered that in the absence of expected cautionary language, they relied on defendant’s oral statements, particularly an oral promise regarding his funding commitment. The court dismissed plaintiffs’ action. Observing that there were no allegations of defendant’s wrongdoing in connection with the corporation’s operation or that he improperly sold his shares, the court said that as “savvy” and “sophisticated” investors, the plaintiffs’ could have ascertained the corporation’s financial condition through publicly filed statements.

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