Savoy v. Boston Private Financial Holdings, Inc.

UNITED STATES DISTRICT COURT

DISTRICT OF MASSACHUSETTS

________________________________________

)

RICHARD SAVOY, Individually and on )

Behalf of All Others Similarly Situated,)

)

Plaintiff, )

)

v. ) Civil Action

) No. 21-11537-PBS

BOSTON PRIVATE FINANCIAL HOLDINGS, INC.,)

et al., )

)

Defendants. )

________________________________________)

MEMORANDUM AND ORDER

August 26, 2022

Saris, D.J.

INTRODUCTION

Plaintiff brings a putative class action on behalf of himself

and all similarly situated former public shareholders of Boston

Private Financial Holdings, Inc. (“Boston Private” or the

“Company”) against Boston Private, its former Chief Executive

Officer Anthony DeChellis, and former members of Boston Private’s

Board of Directors for violations of Sections 14(a) and 20(a) of

the Securities Exchange Act of 1934, 15 U.S.C. §§ 78n(a) and

78t(a), and United States Securities and Exchange Commission Rule

14a-9, 17 C.F.R. § 240.12a-9. Count I alleges that Boston Private’s

proxy solicitations regarding approval of its merger with SVB

Financial Group, Inc., (“SVB”) contain false or misleading

statements, omissions, and half-truths. Count II alleges that the

individual defendants are liable pursuant to Section 20(a) of the

Exchange Act.

Defendants moved to dismiss pursuant to Fed. R. Civ. P.

12(b)(6) and the Private Securities Litigation Reform Act of 1995,

15 U.S.C. § 78u-4. After a hearing, the Court ALLOWS Defendants’

Motion to Dismiss (Dkt. 24).

FACTUAL BACKGROUND

The following facts are taken from the Complaint, the proxy

solicitations, and other communications referenced in the

Complaint.

I. The Merger Agreement

Boston Private was a publicly traded Massachusetts

corporation offering banking and wealth management services. In

October 2020, the Company stated in a press release that it

believed it was “well positioned for long-term success.” Dkt. 23

¶ 27. Its CEO, DeChellis, also stated in an earnings call that he

“remain[ed] optimistic about [Boston Private’s] momentum.” Id.

¶ 28.

On January 4, 2021, after a negotiation between SVB and the

Board of Directors, Boston Private and SVB announced they had

entered into an agreement and plan of merger pursuant to which

Boston Private would merge into SVB, with SVB continuing as the

surviving corporate entity. See Dkt. 26-2. The proposed merger

would award each Boston Private shareholder with $2.10 in cash and

.0228 shares of SVB common stock as consideration for each Boston

Private share, together worth $10.94 as of December 31, 2020.

II. The Proxy Battle

The next day, HoldCo Asset Management, LP, (“HoldCo”)1 the

Company’s fourth largest shareholder, issued two public letters

and press releases outlining its concerns with the proposed merger.

See Dkt. 23 ¶ 33; Dkt. 26-3. This set off a pitched proxy battle.

Boston Private filed its proxy statement with the SEC on March

18, 2021, see Dkt. 26-1, and mailed it to shareholders on March

19, 2021, id at 4. HoldCo filed its proxy statement on March 23,

2021, see Dkt. 26-4, which it supplemented with additional

soliciting material under Rule 14a-12 on March 25, 2021, see Dkt.

26-5. Boston Private filed a press release opposing HoldCo’s

solicitations on April 7, 2021. See Dkt. 26-6. Boston Private filed

an additional press release on April 14, 2021, touting the

recommendation of independent proxy advisory firm Institutional

Shareholder Services. See Dkt. 26-7. In response, HoldCo filed

additional soliciting materials the next day quoting cautionary

1 HoldCo, which owns approximately 4.9% of the Company’s shares, is not a party

to this action.

passages of the advisory recommendation. See Dkt. 26-8. In response

to eight civil lawsuits by shareholders, including one by Plaintiff

filed in New York in February 2021, see Dkt. 26-10, alleging Boston

Private’s proxy filings omitted various facts, Boston Private

filed a written communication pursuant to Rule 425 on April 16,

2021, with supplemental disclosures, see Dkt. 26-11. Savoy and the

other plaintiffs voluntarily dismissed their lawsuits in response

without asking the Court to require Boston Private to make

additional disclosures before the shareholder vote.

In essence, HoldCo contended that Boston Private did not

“conduct[] a competitive process to maximize value for

shareholders” and worried “the Board may have cut a deal that was

optimal for management but suboptimal for shareholders.” Dkt. 23

¶ 33. HoldCo contended that DeChellis had a conflict of interest.

As disclosed in the proxy, DeChellis had been offered a position

as co-head of SVB’s wealth management division, with a significant

pay increase.

On May 4, 2021, the merger was approved by approximately 89

percent of voting shares present. See Dkt. 26-9. The merger closed

on July 1, 2021.

III. Three Other Companies

Three companies other than SVB expressed interest in a

potential transaction with Boston Private. Immediately after the

announcement of the merger, First Foundation Wealth Management

(“FFWM”) CEO Scott Kavanaugh emailed HoldCo to inform it that he

“had been persistently calling Mr. DeChellis to pursue a dialogue

about a merger,” but was told “that the board had instructed him

to focus on getting the stock price higher and that they were not

interested in pursuing a sale.” Dkt. 23 ¶ 34. HoldCo included this

email in full in the public letter it sent to Boston Private and

made available to shareholders. See id. ¶ 34-35; Dkt. 26-3.

In its proxy, Boston Private disclosed that “[i]n August 2019,

Mr. DeChellis had preliminary discussions with the Chief Executive

Officer of a California-based bank holding company of similar size

to Boston Private,” but the Board “determined that the California-

based company was not a strong cultural or strategic fit for Boston

Private and that an acquisition of this company would not be

financially attractive or create meaningful value for Boston

Private shareholders.” Dkt. 26-1 at 59. The company (FFWM)

continued to reach out, but Boston Private “did not pursue further

discussions” because of the company’s size and financial profile

and “its expressed interest in being acquired by Boston Private at

a market premium.” Id.

The proxy further disclosed that the CEO of a second company,

“Company A,” a large bank holding company with a significant wealth

management business, requested a meeting with DeChellis and

discussed “a potential strategic transaction.” Id. at 61.

DeChellis “indicated that the Boston Private board regularly

reviews its strategic alternatives and considers any strategic

options that might enhance value for Boston Private’s

shareholders, and would evaluate any proposal it received, but

that the board was not specifically pursuing a sale of the company

at that time.” Id. The CEO reached out to Boston Private in

November 2020 through Morgan Stanley about a “strategic

transaction,” and DeChellis “noted that he would update the board

in the event any proposal or further inquiry were received from

Company A.” Id. at 63. The CEO of Company A called DeChellis in

December 2020 but told him “that Company A’s board of directors

had not authorized any proposal” although it “might consider a

valuation for Boston Private at a tangible book value multiple

corresponding to a general price range of around $10.50 per share.”

Id. at 64. Following this conversation, “no proposal or indication

of interest was ever provided by or on behalf of Company A.” Id.

Third, the proxy disclosed that the CEO “of a subsidiary of

a wealth management and investment banking firm contacted Mr.

DeChellis to inquire, on behalf of its parent company, whether

Boston Private might be interested in discussing a potential sale

at a valuation of up to a 20–25% premium to Boston Private’s then-

current stock price, which at that time was in the range of $5.50

per share.” Id. at 61. The CEO also reached out to the chairman of

the board of Boston Private. DeChellis “informed the Chief

Executive Officer that Boston Private was not interested in

pursuing a transaction at that price level.” Id. No further

inquiries were received from this company, nor any proposal.

HoldCo publicly criticized Boston Private in its proxy and

additional soliciting materials for failing to run a

comprehensive, competitive sale process, including “by negotiating

exclusively with only one party—SVB—despite reported inbound

interest from at least three other buyers.” Dkt. 26-5 at 5. HoldCo

noted that Company A “offered a higher price than what SVB was

offering at the time, yet [Boston Private] entered into an

exclusivity agreement with SVB on the very next day anyway.” Id.

In response to HoldCo’s accusations, Boston Private issued an

April 7 press release supplementing its proxy. The press release

argued, “A review of the inquiries from HoldCo’s three purported

potential buyers confirms that there was no credible reason for

Boston Private to affirmatively pursue further discussions with

any of these parties.” Dkt. 26-6 at 6. It reiterated that the

preliminary discussions with FFWM in 2019 “centered around an

acquisition by Boston Private of this counterparty . . . in which

Boston Private would be paying a premium,” and so “there was no

reason to engage in further discussions with this potential

counterparty.” Id. As to “Company A,” it reiterated that the

company had only “casually” approached Boston Private and

suggested, “subject to numerous contingencies, it might consider

a valuation at a tangible book value multiple in a general price

range of $10.50.” Id. And as to the subsidiary, Boston Private

reiterated that its suggested premium had an implied transaction

value of less than what SVB was proposing at the time, a price

that Boston Private had concluded was inadequate.

IV. The Independent Proxy Advisor Recommendation

On April 14, 2021, Boston Private issued a press release

announcing that independent proxy advisory firm Institutional

Shareholder Services (ISS) had recommended shareholders vote for

the merger, with DeChellis opining, “This recommendation

underscores that the transaction with SVB Financial is financially

and strategically compelling and provides the best path for

maximizing value for Boston Private shareholders.” Dkt. 26-7 at 2.

Boston Private did not make the report itself available to

shareholders.

The next day, HoldCo issued soliciting materials

characterizing the ISS report as “cautionary.” Dkt. 26-8 at 4

(“ISS’s rare ‘cautionary support’ recommendation for the Merger

gives significant credence to the concerns we have expressed.

Further, in its report ISS makes numerous points that would seem

to support a vote against the Merger.”). HoldCo quoted the report

extensively, most notably its conclusions:

Our analysis points to several conclusions: 1) Is the

deal opportunistic? Probably, as evidenced by the

valuation gap between the two companies when the deal

was struck. 2) Can the buyer afford to pay more, as the

dissident suggests? Most likely, given the size of the

transaction relative to SIVB’s market cap, the benefits

of the deal for the acquirer, and possible levers, such

[sic] the current lack of any TBV earnback period. 3) Is

the immediate downside risk of rejecting the deal

material? Probably not, as evidenced by the recent

appreciation of the index and relevant peers. Given

these factors, certain shareholders may opt to reject

the transaction as a limited-risk option to elicit an

improved offer.

Id.

V. The Fair Value of the Merger

DeChellis and SVB’s CEO began discussing a joint venture in

March 2020, and continued discussions privately through May 2020,

keeping others at Boston Private out of the talks until May 26,

2020, and not actually informing the Board until July 21, 2020.

The Board was informed about SVB’s interest not by DeChellis, but

by representatives of SVB conducting due diligence for a potential

transaction. Boston Private claims the Board then negotiated the

final price.

After a deal was struck, Boston Private’s proxy solicitations

focused on the nominal value of the merger, touting that “[t]he

Board negotiated to increase the value of the value of the merger

consideration from approximately $7.60 per Boston Private share to

$10.94 per Boston Private share.” Dkt. 23 ¶ 4.

But HoldCo publicly argued in its March 25 Proxy Amendment

that Boston Private had actually negotiated for lower

consideration, telling shareholders, “In early September 2020,

SVB’s offer implied an all-stock ratio of 0.0365 SVB shares per

BPFH share, more than 20% higher than the January 4, 2021 all-

stock exchange ratio of 0.0282.” Dkt. 26-5 at 5. HoldCo argued,

“SVB effectively used its increasing share price to reduce the

number of shares it would have to issue to BPFH shareholders.” Id.

Boston Private presented the merger as a “compelling

premium,” of 56 percent above the Company’s unaffected share price

before the announcement. Dkt. 23 ¶ 4. HoldCo disagreed. Its March

25 Proxy Amendment warned that Boston Private’s share price on the

day of the merger announcement, $8.39, represented “an 11% discount

to liquidation value and a 52% discount to the Company’s five-year

median tangible book value multiple of 1.84x, making it one of the

lowest valued banks of its size nationwide.” Dkt. 26-5 at 4. HoldCo

also argued that SVB’s stock was overvalued compared to historical

norms, citing SVB’s own filings to illustrate that SVB’s gains are

“volatile” in nature and “not necessarily indicative of [its]

expected performance in a future period.” Id. at 5. HoldCo opined,

“Therefore, the so-called premium SVB is offering BPFH

shareholders is nothing more than a mirage borne out of BPFH’s

pandemic stock underperformance.” Id. at 4. Boston Private

disparaged HoldCo’s opinions in a press release as “misguided” and

full of “sleights of hand.” Dkt. 26-6 at 10–11.

LEGAL STANDARD

“To survive a motion to dismiss, a complaint must contain

sufficient factual matter, accepted as true, to ‘state a claim to

relief that is plausible on its face.’” Ashcroft v. Iqbal, 556

U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S.

544, 570 (2007)).

A plaintiff bringing a private action arising under the

Securities Exchange Act must comply with the pleading requirements

of the Private Securities Litigation Reform Act (PSLRA), 15 U.S.C.

§ 78u-4. In an action alleging misleading statements and omissions,

“the complaint shall specify each statement alleged to have been

misleading, the reason or reasons why the statement is misleading,

and, if an allegation regarding the statement or omission is made

on information and belief, the complaint shall state with

particularity all facts on which that belief is formed.” 15 U.S.C.

§ 78u-4(b)(8)(1). And “the plaintiff shall have the burden of

proving that the act or omission of the defendant alleged to

violate [the Securities Exchange Act] caused the loss for which

the plaintiff seeks to recover damages.” 15 U.S.C. § 78u-

4(b)(8)(4).

ANALYSIS

Plaintiff alleges the proxy statements contain half-truths

and material omissions.2 “To prevail on a claim under Section 14(a)

and Rule 14a-9, the plaintiff must prove a “misstatement or

omission was material” and “the proxy solicitation itself . . .

was an essential link in the accomplishment of the transaction”

that caused plaintiff’s injury. TSC Indus., Inc. v. Northway, Inc.,

426 U.S. 438, 444 (1976) (citing 17 C.F.R. § 240.14a-9). There is

“no need to demonstrate that the alleged defect in the proxy

statement actually had a decisive effect on the voting.” Id. A

misstatement or omission is “material” if there is “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. at 449.

Materiality does not, however, “require proof of a substantial

likelihood that disclosure of the omitted fact would have caused

the reasonable investor to change his vote.” Id. The First Circuit

has explained, “As far as proxy statements are concerned . . .,

the federal purpose is served if the statement fully and fairly

2 Because this Court finds no material defect in the solicitations, it does not

reach the arguments on loss causation.

sets out such relevant and material facts as would enable a

reasonably prudent shareholder to make an intelligent decision as

to whether to grant the requested proxy or as to how he should

vote on the questions mentioned in the proxy statement.” Lessler

v. Little, 857 F.2d 866, 875 (1st Cir. 1988) (quoting Golub v. PPD

Corp., 576 F.2d 759, 762–63 (8th Cir. 1978)).

As a threshold matter, the parties dispute whether HoldCo’s

proxy solicitations can be considered part of the “total mix” of

information for the materiality analysis. The total mix of

information available to shareholders includes information outside

the proxy solicitations that was widely known in the market. See

Thant v. Karyopharm Therapeutics, Inc., __ F.4th __, 2022 WL

3134028 (1st Cir. August 5, 2022) (quoting Baron v. Smith, 380

F.3d 49, 57 (1st Cir. 2004) (“It is not a material omission to

fail to point out information of which the market is already

aware.”)); Backman v. Polaroid Corp., 893 F.2d 1405, 1420 (1st

Cir. 1990) (“[T]he reasonable investor would not consider withheld

information to be important if it were already widely known to the

market.”); Jackvony v. RIHT Fin. Corp., 873 F.2d 411, 415 (1st

Cir. 1989) (considering materiality in light of “general

knowledge” in the banking community that banking laws would soon

change).

The total mix of information available to a shareholder also

includes information outside of the proxy statement where the

information is already in the public domain and readily available

to shareholders. See United Food and Com. Workers Union Local 880

Pension Fund v. Chesapeake Energy Corp., 774 F.3d 1229, 1238 (10th

Cir. 2014) (holding that a Form 8-K was readily available on the

SEC website and a reasonable investor interested in a company’s

swap practices would know to look at prior 8-K disclosures). But

the investor needs to have had a reasonable basis to look for the

information in publicly available reports outside the proxy

statement before the outside information can be considered as part

of the total mix of information. United Paperworkers Int’l Union

v. Int’l Paper Co., 985 F.2d 1190, 1199 (2d Cir. 1993) (holding

that a reasonable shareholder voting on a proposal who had read

both the proxy statement and the annual report would have received

no indication that additional information was available in the 10-

K report).

Additionally, the “reasonable availability” of outside

information to investors does not include every piece of

information an investor could collect through effort—a board of

directors cannot, for example argue that shareholders should have

called the company and asked for additional information. See Shaev

v. Saper, 320 F.3d 373, 381 (3d Cir. 2003) (“That an investor could

hypothetically conduct research to clarify ambiguities and

discover omissions in the proxy statement does not relieve the

Board of its obligations under Rule 14a-9.”)

“While a proxy is not normally required to contain matter

contained in other materials which are furnished and which are

clearly referred to in the proxy, a company soliciting proxies may

not obviate violation of the disclosure requirements by referring

to materials furnished by its opponents in a proxy contest.”

Gladwin v. Medfield Corp., 540 F.2d 1266, 1270 (5th Cir. 1976)

(citing Kohn v. Am. Metal Climax, Inc., 458 F.2d 255, 265 (3d Cir.

1972), overruled on other grounds by Kershner v. Mazurkiewicz, 670

F.2d 440, 448 (3d Cir. 1982) (“[A]ny otherwise material violation

of the disclosure rules is not obviated by referring to materials

of an opposing soliciting party.”)).

Nevertheless, investors have been expected to have knowledge

of publicly available SEC filings since 1996 when the SEC required

domestic public companies to file electronically. Kaplan v. First

Hartford Corp., 447 F. Supp. 2d 3, 8 (D. Mass. 2006) (citing In re

Keyspan Corp. Sec. Litig., 383 F. Supp. 2d 358, 374 n.6 (E.D.N.Y.

2003)).

This dispute involves a contentious proxy battle in which

HoldCo and Boston Private were publicly engaged in debate. HoldCo’s

communications were referenced in the Boston Private

solicitations, were filed with the SEC, and were readily available

to shareholders through the EDGAR system on the SEC’s website. A

shareholder would be putting on blinders to not consider the

readily available information on the website that were at the heart

of the proxy fight. See In re Keyspan Corp. Securities Litig., 383

F. Supp. 2d 358, 373 (E.D.N.Y. 2003) (“[I]n today’s world it is

unrealistic to argue that documents available on the SEC website

are not readily accessible to the investing public.”); Lone Star

Steakhouse & Saloon, Inc. v. Adams, 148 F. Supp. 2d 1141, 1144 (D.

Kan. 2001) (“[T]he court deems any SEC filings distributed because

all filings are readily available to the public both through the

Internet and other media.”). In this setting, under the case law,

the publicly available communications from HoldCo are part of the

total mix of information available to the reasonable investor.

I. Statements about the Interest of Other Parties

Plaintiff accuses eight statements of being materially false

and misleading, three as to the interest of other parties:

I. That DeChellis and Boston Private had closed the

door on incoming interest from the CEO of First

Foundation Wealth Management (“First Foundation”),

because “Boston Private had previously determined that

such a transaction would not be financially attractive

or create meaningful value for Boston Private

shareholders, and that this company was not a strong

financial, cultural, or strategic fit for Boston Private

[and that] [a]ccordingly there was no reason to engage

in further discussions . . . .” Boston Private

Shareholder Letter & Proxy Solicitation, p. 4 (Apr. 7,

2021)

II. That First Foundation’s “apparent interest was in

being acquired by Boston Private,” rather than interest

in a dialogue about a merger. (Id.)

III. That “no . . . institution, other than SVB

Financial, ever submitted a proposal regarding a

potential acquisition or strategic business combination

to Boston Private.” Boston Private Definitive Proxy, p.

61 (Mar. 18, 2021).

Dkt. 23 ¶ 4. In essence, Plaintiff argues that these statements

omit the continued outreach from FFWM; omit that FFWM was

interested in a merger, not just an acquisition; and mislead as to

why there were no proposals, given that DeChellis impeded such

proposals by refusing to seriously engage with other interested

institutions.

As outlined above, Boston Private disclosed the facts of its

interactions with all three companies. In fact, the proxy

explicitly disclosed FFWM’s continued outreach. See Dkt. 26-1 at

59 (“The California-based company’s Chief Executive Officer

continued to periodically reach out to Mr. DeChellis from time to

time in an effort to gauge whether Boston Private’s views towards

a transaction might have changed.”). And even if Kavanaugh’s email

about his interest in a “merger” could be interpreted to express

interest in more than just being acquired by Boston Private, Boston

Private’s statement that he was primarily interested in the

acquisition did not change the total mix of information,

particularly given that HoldCo had made the email available to

shareholders. Shareholders could interpret the email themselves.

And the proxy disclosed that DeChellis told the companies that

Boston Private was not interested. See, e.g., Dkt. 26-1 at 61

(noting that DeChellis said “that the board was not specifically

pursuing a sale of the company at that time”).

Plaintiff is unpersuasive in arguing that these disclosures,

or lack thereof, misleadingly painted the three parties as

unserious in their offers. The total mix of information available

to shareholders, largely through Boston Private’s own proxy

solicitations, was sufficient to allow shareholders to reach their

own conclusions. See New England Anti-Vivisection Soc., Inc. v.

U.S. Surgical Corp., Inc., 889 F.2d 1198, 1202 (1st Cir. 1989)

(“[F]ederal law is satisfied as long as the proxy materials fully

and fairly set forth the relevant and material facts from which a

reasonable shareholder may draw his own conclusions as to how to

vote.”). “Fair accuracy, not perfection, is the appropriate

standard.” Id. (quoting Kennecott Copper Corp. v. Curtiss-Wright

Corp., 584 F.2d 1195, 1200 (2d Cir. 1978)).

II. Statements about the Proxy Advisor Recommendation

Plaintiff accuses two statements of being materially false

and misleading as to the third-party proxy advisor recommendation:

IV. That the independent proxy advisory company

Institutional Shareholder Services had “recommend[ed]

that Boston Private shareholders support the

recommendation of [Boston Private’s] Board and vote in

favor of the merger with SVB Financial.” Boston Private

Press Release & Proxy Solicitation (Apr. 14, 2021)

V. That ISS’s report “underscore[d] that the

transaction with SVB Financial [was] financially and

strategically compelling and provide[d] the best path

for maximizing value for Boston Private shareholders.”

(Id.)

Dkt. 23 ¶ 4. Plaintiff argues that Defendant’s nondisclosure

of ISS’s negative observations was unlawful.

Plaintiff argues that once Defendants touted the

positive recommendation, they were required to disclose the

negative observations within the recommendation. The claim

that Boston Private’s description of the ISS recommendation

was a half-truth is plausible. However, HoldCo made the

negative observations available to shareholders, and they

were part of the total mix of information available to

shareholders during the proxy battle. Cf. Burkle v. OTK

Associates, LLC, 2 F. Supp. 3d 519, 524 (S.D.N.Y. 2014)

(noting that the “misleading effect” of a company’s press

release about an ISS recommendation “was dissipated and

counteracted” by news articles that “supplied the ‘total mix’

of information that their press release omitted”).

III. Statements about the Fair Value of the Merger

Plaintiff accuses three statements of being materially false

and misleading as to the fair value of the merger:

VI. That “[t]he Board negotiated to increase the value

of the merger consideration from approximately $7.60 per

Boston Private share to $10.94 per Boston Private share

at the date of announcement of the transaction[.]”

Boston Private Shareholder Letter & Proxy Solicitation,

p. 4 (Apr. 7, 2021)

VII. That the merger provided shareholders a “compelling

premium” that had “substantially increased since

[December 31, 2020] as a result of the appreciation of

SVB Financial’s share price, [. . .] corresponding to a

56% premium to Boston Private’s unaffected share price

as of immediately prior to announcement[.]” (Id.)

VIII. That “[t]he Board believe[d] that the transaction

with SVB Financial provide[d] substantially higher and

more certain value to Boston Private shareholders than

the company’s available alternatives.” (Id.).

Dkt. 23 ¶ 4. Plaintiff argues that these statements mislead by

focusing on the nominal value and omitting the fact that the

implied exchange ratio decreased over the course of negotiations.

In Plaintiff’s view, the exchange ratio was not fair because Boston

Private and SVB stocks were under- and over-valued, respectively.

As to the alleged omissions, again, the Court need not parse

whether, as Defendants argue, the drop in exchange ratio was a

“conclusion [that] is obvious to anyone conversant with elementary

mathematics.” Data Probe Acquisition Corp. v. Datatab, Inc., 722

F.2d 1, 5 (2d Cir. 1983). Once again, additional disclosure would

not have altered the total mix of information available to

shareholders; HoldCo had already made the exchange ratio public

knowledge, along with its calculations of both companies’ actual

values. While shareholders might give more weight to the opinions

of the Board, which owes them a fiduciary duty, the facts

underlying HoldCo’s opinions, released to shareholders, were

already reasonably likely to be considered by shareholders. There

was no material omission or misrepresentation as to the sixth and

seventh statements.

With respect to the eighth statement, Plaintiff argues

Defendants did not genuinely believe this was the best option,

highlighting that DeChellis and the Board had previously touted

the Company’s financial performance and prospects and that the ISS

evaluation cautioned that a higher price likely could have been

achieved. He points out that DeChellis rebuffed outside interest

because he stood to personally gain from a deal with SVB. Here,

the question is of subjective sincerity:

For a statement of opinion, the plaintiff must plead

that the statement falsely represented the speaker's

belief at the time it was made (i.e., that the speaker

did not sincerely believe the statement) and that it was

untrue; that a statement of fact embedded within the

opinion is untrue; or that the speaker omitted material

facts that would make the statement misleading to a

reasonable investor.

Miller Investment Trust v. Morgan Stanley & Co., LLC, 308 F. Supp.

3d 411, 429 (D. Mass. 2018) (citing Omnicare, Inc. v. Laborers

Dist. Council Const. Ind. Pension Fund, 5757 U.S. 175, 189–92

(2015)). Plaintiff has not stated a plausible claim that the Board

or DeChellis did not sincerely believe the SVB deal was the best

option available to Boston Private—the evidence it cites does not

plausibly belie the sincerity of the belief.

ORDER

After hearing, for the reasons stated above, the Court ALLOWS

Defendants’ Motion to Dismiss (Dkt. 24).

SO ORDERED.

/s/ PATTI B. SARIS

Patti B. Saris

United States District Judge