Lase Guaranty Trust v. Bammann

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

------------------------------------x

LASE GUARANTY TRUST, derivatively on

behalf of JPMORGAN CHASE & CO.,

MEMORANDUM & ORDER

Plaintiff, 22-CV-01331(EK)(JAM)

-against-

LINDA B. BAMMANN, STEPHEN B. BURKE,

TODD ANTHONY COMBS, JAMES SCHINE

CROWN, JAMES DIMON, et al.,

Defendants.

-and-

JPMORGAN CHASE & CO.,

Nominal Defendant.

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ERIC KOMITEE, United States District Judge:

Federal regulations require securities and commodities

dealers to preserve their employees’ business-related

communications for inspection. In December of 2021, three

JPMorgan Chase subsidiaries admitted that their employees,

including some in management, were conducting firm business in

unapproved communications channels — via personal email

accounts, text message, and WhatsApp — and that these

communications were not preserved. JPM settled books-and-

records charges with the Securities and Exchange Commission and

the Commodity Futures Trading Commission for a total of $200

million in civil penalties.

Lase Guaranty Trust, a JPM shareholder, initiated this

derivative action against certain JPM board members. Lase

alleges that the board members materially misled shareholders

while seeking reelection, in violation of Section 14(a) of the

Securities Exchange Act. The misleading statements and

omissions are alleged to have been made in the company’s 2021

proxy statement. At bottom, Lase complains that the proxy

statement made several optimistic assertions about the

robustness of JPM’s compliance environment, while simultaneously

omitting to disclose the widespread use of unapproved

communications channels. In addition to the Section 14(a)

claim, Lase brought state-law claims alleging, among other

things, that the directors breached their fiduciary duties.

The defendants have now moved to dismiss all claims.

The motion is based on two primary grounds: first, that Lase

failed to comply with the requirement that, prior to filing a

derivative action, the plaintiff first demand that the board of

directors initiate the case. Second, the defendants move to

dismiss all causes of action for failure to state a claim.

For the reasons that follow, the Section 14(a) claim

is dismissed. Having dismissed the only federal claim, the

court declines to entertain supplemental jurisdiction over the

state-law claims.

Background

The following recitation is taken from Lase’s Amended

Verified Stockholder Derivative Complaint (“Am. Compl.”), ECF

No. 16, and certain materials discussed extensively therein: the

SEC and CFTC orders and JPM’s 2021 proxy statement.1

JPM consented to the entry of orders imposing

sanctions with the SEC and the CFTC in December of 2021. See

Am. Compl. ¶ 5. In doing so, the bank admitted that the

recordkeeping violations were “firm-wide,” “involved employees

at all levels of authority,” and were “not hidden within the

firm.” See MTD Ex. B at 4, ECF No. 23-2. The orders spoke to

the bank’s mental state: JPM admitted that the violations were

“willful[].” MTD Ex. A at 6, ECF No. 6. Moreover, “managing

directors and senior supervisors responsible for implementing

JPM’s policies and procedures, and for overseeing employees’

compliance with those policies and procedures, themselves failed

1 On a motion to dismiss, the court may consider a document outside the

complaint where the complaint “relies heavily upon its terms and effect,

which renders the document integral to the complaint.” Chambers v. Time

Warner, Inc., 282 F.3d 147, 152–53 (2d Cir. 2002). The court may also take

judicial notice of documents in the public record, including SEC filings and

orders of administrative agencies, “to establish the fact of such . . .

filings.” In re Morgan Stanley Info. Fund Sec. Litig., 592 F.3d 347, 355 n.5

(2d Cir. 2010).

Unless otherwise noted, when quoting judicial decisions this order

accepts all alterations and omits all citations, footnotes, and internal

quotation marks.

to comply.” MTD Ex. B at 4. JPM acknowledged that these

violations had been ongoing for years. See MTD Ex. A at 2.

Months before these settlements, JPM’s board of

directors sought shareholder approval for the directors’

reelection and their compensation package. See Am. Compl.

¶ 102; see also 2021 JPM Proxy Statement (“Proxy”) 1, 87, ECF

No. 32-3.2 The proxy statement asserted that JPM had strong risk

controls and that JPM makes risk management a priority. See Am.

Compl. ¶¶ 103–04, 106–08, 110–17. The proxy statement also

described JPM’s governance practices as “strong,” and “sound.”

See Am. Compl. ¶¶ 115–16; Proxy 13, 30. It represented that

JPM expects “all employee conduct [to] adhere to the highest

ethical standards.” See Am. Compl. ¶ 103; Proxy 64. It

likewise represented that the directors “possess the skills,

experience, personal attributes and tenure” needed to “oversee

the Firm’s risk management.” See Am. Compl. ¶ 105; Proxy 20.

And it stated that JPM has strong clawback provisions “designed

to hold executives accountable, when appropriate.” See Am.

Compl. ¶ 109; Proxy 58–59.

Lase asserts that these statements — and the

concurrent omission to disclose the recordkeeping violations —

were materially misleading, in violation of Section 14(a) of the

2 Page numbers in citations to the 2021 proxy statement refer to ECF

pagination.

Exchange Act. See id. ¶¶ 255–60. That provision prohibits

registrants from soliciting proxy statements in a manner that

violates SEC regulations — including Rule 14a-9, which forbids

material misstatements and omissions in proxies. Lase also

asserts Delaware law claims for breach of fiduciary duties and

waste of corporate assets (JPM is incorporated in Delaware).

See id. ¶¶ 261–70.

The defendants moved to dismiss. See Defs.’ Mem. of

L. Supp. Mot. to Dismiss (“Defs.’ Mem.”) 1–2, ECF No. 22. With

the court’s authorization, the parties initially briefed only

the Fed R. Civ. P. 23.1 issue regarding failure to demand that

JPM’s board of directors initiate this action. Sept. 21, 2022

Order.

Following oral argument on the Rule 23.1 issue, the

court sought supplemental briefing on the Section 14(a) claim,

including whether it should be dismissed for failure to state a

claim under Rule 12(b)(6) rather than pursuant to Rule 23.1.

See Arg. Tr. 51:1–10, 56:11–57:2, ECF No. 29. The defendants

then moved to dismiss all claims for failure to state a claim.

See Suppl. Br. Supp. Mot. to Dismiss (“Defs.’ Suppl.”) 1, ECF

No. 30.

Legal Standards

To overcome a motion to dismiss under Rule 12(b)(6), a

complaint must plead facts sufficient “to state a claim to

relief that is plausible on its face.” Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007). The court must accept all

factual allegations in the complaint as true and draw all

reasonable inferences in the plaintiff’s favor. See Lundy v.

Cath. Health Sys. of Long Island Inc., 711 F.3d 106, 113 (2d

Cir. 2013).

Rule 23.1 outlines requirements that apply when “one

or more shareholders or members of a corporation . . . bring a

derivative action to enforce a right that the corporation or

association may properly assert but has failed to enforce.”

Fed. R. Civ. P. 23.1(a). Among other prerequisites, a

derivative complaint must “state with particularity: (A) any

effort by the plaintiff to obtain the desired action from the

directors or comparable authority, and, if necessary, from the

shareholders or members; and (B) the reasons for not obtaining

the action or not making the effort.” Fed. R. Civ. P.

23.1(b)(3)(A)-(B).

The upshot is that “a shareholder seeking to assert a

claim on behalf of the corporation must first exhaust

intracorporate remedies by making a demand on the directors to

obtain the action desired.” F5 Cap. v. Pappas, 856 F.3d 61, 82

(2d Cir. 2017). “Although Rule 23.1 sets forth the pleading

standard for federal court, the substance of the demand

requirement is a function of state law — here, Delaware law.”

Id. “A shareholder plaintiff who does not make a demand on the

board must allege that demand is excused.” Id. When federal

courts apply Delaware law, “[d]emand futility analysis is

conducted on a claim-by-claim basis.” Lambrecht v. O’Neal, 504

F. App’x 23, 26 (2d Cir. 2012) (citing Beam v. Stewart, 833 A.2d

961, 977 n. 48 (Del. Ch. 2003), aff’d, 845 A.2d 1040 (Del.

2004)).

Discussion

A. Failure to Make a Demand Under Rule 23.1

The defendants seek dismissal based on Rule 23.1:

Lase did not demand that JPM’s board bring this suit, and such

demand was not excused. See Defs.’ Suppl. 1–2. Lase responds

that it has adequately pled that demand should be excused for

all claims.

Under Delaware law, demand is excused when a

corporation’s board cannot “impartially consider a litigation

demand” — in such circumstances, demand is deemed futile. See

Del. Ch. Ct. R. 23.1; United Food & Com. Workers Union &

Participating Food Indus. Emps. Tri-State Pension Fund v.

Zuckerberg, 262 A.3d 1034, 1059, 1064 (Del. 2021). This is the

case when, for example, a majority of the directors who would

consider the demand face a “substantial likelihood of liability”

on the claim. Id. at 1059.

Lase alleges that all defendants — the directors who

would have considered a demand here — face a substantial

likelihood of liability on all claims. See Am. Compl. ¶ 125.

The defendants, in turn, argue that they face no such

substantial likelihood of liability on any claim, and therefore

that demand was not excused. See Defs.’ Mem. 13.

As to the Section 14(a) claim — the sole basis for

federal jurisdiction — the defendants argue that they cannot be

held liable to shareholders because a provision in JPM’s charter

exculpates them from such liability. See Defs.’ Mem. 13–15.

That provision states that “to the fullest extent” that Delaware

law “permits the limitation or elimination of the liability of

directors, no director of [JPM] shall be personally liable to

[JPM] or its stockholders for monetary damages for breach of

fiduciary duty as a director.” JPM Restated Certificate of

Incorporation (the “Charter”) at art. 6(1), ECF No. 23-3. And

Delaware law, in turn, allows charter provisions “eliminating or

limiting the personal liability of a director or officer to the

corporation or its stockholders for monetary damages for breach

of fiduciary duty as a director” — except for, most importantly,

breaches of the duty of loyalty and actions involving

intentional misconduct. 8 Del. § 102(b)(7).

If directors are protected by such a charter

provision, a shareholder plaintiff seeking only monetary damages

must plead “a non-exculpated claim for breach of fiduciary

duty,” or else “that director will be entitled to be dismissed

from the suit” at the pleading stage. In re Cornerstone

Therapeutics Inc, S’holder Litig., 115 A.3d 1173, 1179 (Del.

2015); accord KDW Restructuring & Liquidation Servs. LLC v.

Greenfield, 874 F. Supp. 2d 213, 223–24 (S.D.N.Y. 2012)

(applying Delaware law). Because exculpated claims must be

dismissed at the pleading stage, a defendant who is exculpated

does not face a “substantial likelihood of liability,” and can

impartially consider a demand to bring an exculpated claim

against even herself. Zuckerberg, 262 A.3d at 1054.

Following a preliminary reading, it remained unclear

to this court whether the exculpation provision in JPM’s charter

squarely applies to Lase’s Section 14(a) claim. Lase expressly

pleaded that its Section 14(a) claim “is based solely on

negligence.” Am. Compl. ¶ 252. JPM’s charter, however,

exculpates JPM directors from liability for “monetary damages

for breach of fiduciary duty as a director” — obviously a

different cause of action from negligence. See Charter at art.

6(1). It is true that Delaware’s fiduciary duty subsumes a duty

of care, and that certain instances of negligence can be

sufficiently egregious as to violate it. But not all: such a

breach requires directors to act with gross negligence. See

Aronson v. Lewis, 473 A.2d 805, 812 & n.6 (Del. 1984) (liability

under Delaware’s business judgment rule is “predicated upon

concepts of gross negligence”), overruled on other grounds by

Brehm v. Eisner, 746 A.2d 244 (Del. 2000). Thus, while a

negligence action can implicate the duty of care, it may still

be the case that a director can act negligently without

breaching any fiduciary duty.3

Lase does not argue that its Section 14(a) claim is

non-exculpable because it sounds in negligence short of a breach

of Delaware’s fiduciary duty of care. Rather, in its

supplemental brief, Lase argued that its Section 14(a) claim is

premised on conduct so extreme, it violated the directors’ duty

of loyalty (and the subsidiary duty of good faith) — violations

that are non-exculpable. See Pls.’ Suppl. Mem. Opp. Mot. to

Dismiss (“Pls.’ Suppl. Opp.”) 9–10, ECF No. 31. Lase requested

leave to amend its complaint again to conform the complaint to

this theory. See id. at 3. In particular, Lase proposed to

omit the paragraph limiting the Section 14(a) count to

3 In contemplating this point, the court posited at oral argument the

case of an employee who negligently caused a motor-vehicle accident, leading

to respondeat superior liability for his employer. The court asked whether

that employee might remain liable to the employer for contribution despite

the exculpation for breaches of fiduciary duty. See Arg. Tr. 5:7–25.

Counsel for JPM responded that, logically speaking, an exculpation from the

“greater” liability — gross negligence — must logically include exculpation

from the lesser — simple negligence. This view finds meaningful support in

federal district court cases. See, e.g., In re Wells Fargo & Co. S'holder

Derivative Litig., No. 20-CV-08750-MMC, 2022 WL 345066, at *5 (N.D. Cal. Feb.

4, 2022) (collecting cases applying exculpation clauses to Section 14(a)

claims and observing that “there are, to the Court’s knowledge, no cases

holding to the contrary”). In the end, however, I leave this question for

another day.

negligence, rather than “reckless or knowing conduct” by JPM’s

directors. See id. (citing Am. Compl. ¶ 252).

In this case, I do not need to decide whether demand

would have been futile. The parties agree that compliance with

Rule 23.1 is not something the court must address before

assessing whether a plaintiff states a claim. Compliance with

Rule 23.1’s demand requirement is not a matter of jurisdiction.

See Nat’l Credit Union Admin. Bd. v. U.S. Bank Nat’l Ass’n, 898

F.3d 243, 252 n.57 (2d Cir. 2018).4

As discussed below, the plaintiffs have failed to

state a claim under Section 14(a), by a relatively wide margin.

That claim is thus dismissed under Rule 12(b)(6).

B. Failure to State a Viable Section 14(a) Claim

Section 14(a) outlaws the solicitation of any proxy

“in contravention of such rules and regulations as the [SEC] may

prescribe.” 15 U.S.C. § 78n(a)(1). SEC Rule 14a–9(a), in turn,

provides that: “No solicitation subject to this regulation shall

be made by means of any proxy . . . containing any statement”

that “is false or misleading with respect to any material fact,

or which omits to state any material fact necessary in order to

make the statements therein not false or misleading.” 17 C.F.R.

§ 240.14a–9(a).

4 In National Credit Union, the Second Circuit “adhere[d] to the view”

that questions of “derivative standing” should be viewed as Rule 12(b)(6)

issues, not Article III issues. Id.

“A fact is material for purposes of Rule 14a–9 if

there is a substantial likelihood that a reasonable shareholder

would consider it important in deciding how to vote.” Koppel v.

4987 Corp., 167 F.3d 125, 131 (2d Cir. 1999). “Once the proxy

statement purports to disclose” material facts, “there is an

obligation to portray them accurately.” Id.

The Private Securities Litigation Reform Act imposes

heightened pleading requirements on Section 14(a) claims. In

“any private action arising under” the Exchange Act in which the

plaintiff alleges a material misstatement or omission, the

plaintiff must “specify each statement alleged to have been

misleading” and “the reason or reasons why the statement is

misleading.” 15 U.S.C. § 78u-4(b)(1). The plaintiff “must do

more than say that the statements . . . were false and

misleading; [it] must demonstrate with specificity why and how

that is so.” Rombach v. Chang, 355 F.3d 164, 174 (2d Cir.

2004). District courts in this circuit have uniformly applied

these requirements to negligence-based Section 14(a) claims.

See, e.g., Lanigan Grp., Inc. v. Li-Cycle Holdings Corp., No.

22–CV–02222, 2023 WL 6541884, at *3 (E.D.N.Y. Oct. 6, 2023)

(collecting cases).

Here, Lase has failed to plead a material misstatement

or omission in the 2021 proxy statement.

1. Immaterial Statements

Many of the statements at issue concern JPM’s risk

controls — their existence, quality, and importance. See Am.

Compl. ¶¶ 103–04, 106–08, 110–17. Representative examples in

the proxy include:



The board of directors “actively oversees” JPM’s

“business and affairs,” employing “sound governance

practices,” Proxy 19, and reviews its performance

against “regulatory requirements.” See id. at 36.



JPM’s “rigorous” risk, controls & conduct review

process includes an “enterprise-wide framework for

management to oversee and respond to workforce

conduct-related matters that may otherwise expose

[JPM] to financial, reputational, compliance and other

operating risks.” Id. at 50, 59.



Various board committees oversee issues relating to

governance, internal controls, and employee conduct.

See id. at 32–35.



JPM is “focused on managing employee conduct end-to-

end,” and has “performance development and

compensation processes” that are “designed to hold

employees accountable for their conduct, where

appropriate.” Id. at 64.



JPM “[c]ontinued to enhance risk, controls and conduct

information provided to managers to use during

performance reviews and employee conduct inquiry &

investigation processes,” “strengthen [the] risk and

control environment,” and “conduct business in a

responsible way.” Id. at 47, 61.



JPM “strive[s] to clearly and frequently communicate

our expectations that all employee conduct must adhere

to the highest ethical standards . . . including

through town hall meetings and senior leadership

messages and by including culture and conduct related

questions in our employee surveys.” Id. at 64.

 The board sets the cultural “tone at the top.” Id. at

19.

Lase alleges that these statements are false because

the Board “utterly failed” to “implement and maintain effective

internal controls and corporate governance” sufficient to

“ensure” regulatory compliance and “monitor the material risks”

to JPM. Am. Compl. ¶ 118. In support, Lase points to the

recordkeeping violations. See id.

The Second Circuit has held similar statements to be

immaterial in another Section 14(a) case involving a JPM proxy

statement. See ECA, Loc. 134 IBEW Joint Pension Tr. of Chi. v.

JP Morgan Chase Co., 553 F.3d 187, 205–06 (2d Cir. 2009). In

ECA, the plaintiffs alleged that JPM “made numerous

misrepresentations regarding its ‘highly disciplined’ risk

management and its standard-setting reputation for integrity.”

Id. at 205. The panel held that these statements were

immaterial — and, thus, nonactionable — as they were “too

general to cause a reasonable investor to rely upon them.” Id.

at 206. The statements “did not, and could not, amount to a

guarantee that [JPM’s] choices would prevent failures in its

risk management practices.” Id.

More recently, the Circuit wrote (in a substantially

similar, but not identical, posture): “a plaintiff cannot

(a) identify a specific back-end, price-dropping event, (b) find

a front-end disclosure bearing on the same subject, and then

(c) assert securities fraud, unless the front-end disclosure is

sufficiently detailed in the first place.” Ark. Tchr. Ret. Sys.

v. Goldman Sachs Grp., Inc., 77 F.4th 74, 102 (2d Cir. 2023).5

“[A] mismatch in specificity between the two undercuts a

plaintiff’s theory that investors would have expected more from

the front-end disclosure.” Id.

This case presents a paradigmatic example of that

mismatch in specificity. Simply put, the “up-front” disclosures

that Lase relies on are significantly more generic than the

ostensibly corrective disclosures in the SEC and CFTC

settlements. In addition to the statements set out above, Lase

challenges, for example, the proxy’s claim that JPM was

“committed to strong corporate governance practices.” Am.

Compl. ¶ 103. But it is generally “well-established that

general statements about reputation, integrity, and compliance

with ethical norms are inactionable” in securities fraud cases.

City of Pontiac Policemen’s & Firemen’s Ret. Sys. v. UBS AG, 752

F.3d 173, 183 (2d Cir. 2014). As in the cases described above,

these kinds of statements are simply “too general to cause a

reasonable investor to rely upon them.” Id. (affirming the

dismissal, on materiality grounds, of a case challenging

“general statements about reputation, integrity, and compliance

5 The Arkansas Teacher case was decided at the class certification stage

— a different analysis from the question of whether materiality has been

adequately pleaded, to be sure; but the court explicitly noted that “the

overlap is substantial” between the two settings. Id.

with ethical norms”); see also IV Louis Loss, Joel Seligman, &

Troy Paredes, Securities Regulation 6.C.5 (6th ed. 2020)

(collecting Section 14(a) cases in which general statements were

held immaterial).

2. Statements That are Not Misleading

Lase challenges certain additional statements in the

proxy, but fails to satisfy Rule 14a-9’s requirement to allege

that the statements were false or misleading, let alone

materially so. See Am. Compl. ¶¶ 105, 109.

Lase challenges the representation that the director

nominees have personal qualities — “skills, experience, personal

attributes and tenure” — that would allow them to “effectively

oversee [JPM’s] risk management and internal control framework,

and management’s execution of its responsibilities.” Proxy 20.

But Lase makes no allegations about the true personal qualities

of the nominees that would demonstrate how or why this statement

is misleading.

Lase also challenges the representation that JPM has

strong clawback provisions “designed to hold executives

accountable, when appropriate.” See Proxy 58–59. Again,

however, Lase never alleges that no such clawback provisions

exist. Instead, Lase asserts that this statement is misleading

because JPM did not elect to invoke the clawback provisions in

this case. See Am. Compl. ¶ 109. But “[i]t is well established

that Section 14 carries with it no formal requirement that

predictions be made as to future behavior, and indeed, they are

discouraged.” Krauth v. Executive Telecard, Ltd., 890 F. Supp.

269, 288-89 (S.D.N.Y. 1995).6

3. Omissions

Lase also alleges liability based on certain

omissions. The proxy statement, for example, claimed that JPM’s

directors frequently met with regulators about expectations for

compliant conduct.7 See Am. Compl. ¶ 76. Given this claim, the

plaintiff contends, it was a material omission to fail to

disclose (1) employees’ widespread use of off-channel

communications at JPM; and (2) the defendants’ own breaches of

fiduciary duty in failing to police those violations. See id.

¶ 255.

These are not actionable omissions. For an omission

to be actionable, the securities laws must impose a duty to

disclose the omitted information. Resnik v. Swartz, 303 F.3d

147, 154 (2d Cir. 2002). “[O]nce a company speaks on an issue

or topic, there is a duty to tell the whole truth.” Meyer v.

6 The defendants, citing a Wall Street Journal article, assert that it

is actually “publicly known that JPMorgan did claw back pay from executives

as a result of conduct related to record keeping violations.” Defs.’ Suppl.

Reply Mem. of L. Supp. Mot. to Dismiss 10 & n.10, ECF No. 33. But I need not

look beyond the complaint to conclude that this statement is inactionable.

7 Plaintiff’s counsel invoked this statement before any other at oral

argument, citing it as an example of why the failure to disclose off-channel

communications was “materially omissive.” Arg. Tr. 32:9–13.

Jinkosolar Holdings Co., 761 F.3d 245, 250 (2d Cir. 2014).

However, “the duty to disclose more is triggered only where that

which is disclosed is sufficiently specific.” Ark. Tchr., 77

F.4th at 102. The disclosure that JPM’s directors speak to

regulators about their agencies’ expectations falls short of the

level of specificity that triggers such a duty.

Generally speaking, “companies do not have a duty to

disclose uncharged, unadjudicated wrongdoing.” Pontiac, 752

F.3d at 184. Nor must directors accuse themselves of a breach

of fiduciary duty. See Koppel, 167 F.3d at 134. Rather, where

“there is simply no misrepresentation or omission of material

facts other than the omission of . . . self-accusation” of

breach of fiduciary duty, then “there is no basis” for a Section

14(a) claim. Id.

In sum, Lase has failed to adequately plead a material

misstatement or omission in the 2021 proxy statement. The

Section 14(a) claim is accordingly dismissed under Rule

12(b)(6).8

8 Lase’s failure to identify a material misstatement or omission is

fatal to the Section 14(a) claims. But even if Lase had identified a

material misstatement or omission, to state a 14(a) claim, Lase would need to

sufficiently plead “both transaction causation, i.e., that but for the

fraudulent statement or omission, the plaintiff would not have entered into

the transaction; and loss causation, i.e., that the subject of the fraudulent

statement or omission was the cause of the actual loss suffered.” Suez

Equity Invs., L.P. v. Toronto-Dominion Bank, 250 F.3d 87, 95 (2d Cir. 2001);

see also Grace v. Rosenstock, 228 F.3d 40, 47 (2d Cir. 2000). The Second

Circuit has recently rejected Section 14(a) claims premised on “defective”

director elections for want of loss causation. See Rubenstein ex rel

C. Delaware Law Claims

As there are no federal claims remaining, I decline

the defendants’ invitation to exercise supplemental jurisdiction

over the state-law claims. See Defs.’ Supp. Mem. 10. This is

the “usual” outcome when all federal claims are dismissed at the

pleading stage. See Pension Ben. Guar. Corp. ex rel. St.

Vincent Cath. Med. Ctrs. Ret. Plan v. Morgan Stanley Inv. Mgmt.

Inc., 712 F.3d 705, 727 (2d Cir. 2013). No special reason

emerges to justify a deviation from that practice here.

Conclusion

The complaint is dismissed without prejudice. Lase

may file a motion seeking leave to file an amended complaint

within thirty days. Any such motion should include the proposed

amended complaint as an exhibit in accordance with this court’s

individual rules and practices. If Lase does not seek leave to

Jefferies Fin. Grp. Inc. v. Adamany, No. 22-2794, 2023 WL 6119810, at *4 (2d

Cir. Sept. 19, 2023). The Rubenstein panel reasoned that the plaintiff had,

among other things, failed to allege that, absent the purported material

omission he identified in the proxy, “the directors would not have been re-

elected.” Id. I need not decide the issue here.

amend within thirty days, judgment shall enter, and the case

shall be closed.

SO ORDERED.

/s/ Eric Komitee__________

ERIC KOMITEE

United States District Judge

Dated: March 14, 2024

Brooklyn, New York