In Re Optionable Securities Litigation, 577 F.Supp.2d 681 (SDNY 2008)

Outcome: Motion to dismiss granted

Description: In re Optionable Securities Litigation, No. 07 Civ. 3753(LAK), 2008 WL 4223662 (S.D.N.Y. 2008), 577 F.Supp.2d 681 (S.D.N.Y. 2008). Mr. Gelber represented the former CEO of Optionable, Inc (“OPBL”). The class Complaint alleged that OPBL and various individuals defrauded the stock market by: (i) misrepresenting how much OPBL’s largest customer, Bank of Montreal (BMO) affected OPBL’s business (ii) misrepresenting the viability of OPEX, OPBL’s natural gas trading platform (iii) misrepresenting the nature of an agreement OPBL entered with NYMEX and (iv) failing to disclose the CEO’s alleged old non-securities related convictions, among other allegations. The Court granted the motion to dismiss and upheld the defense arguments on all points. The Court expressly ruled that OPBL had no obligation to disclose the alleged old convictions because (1) Item 401 of Regulation S-B did not require disclosure and (2) such disclosure was not, in any event, necessary “to make other statements not false or misleading”.