Taseko Mines Limited v. Raging River Capital Lp

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
TASEKO MINES Ltd., )
)
Plaintiff, )
)
v. ) Civil Action No. 16-390 (GK)
)
RAGING RIVER CAPITAL, et al., )
)
Defendants. )
``~---``````````~->
MEMORDANDUM OPINION
Plaintiff Taseko Mines Limited ( "Taseko" or "the Company")
brings this action against Raging River Capital LP, Raging River
Capital GP LLC, Granite Creek Partners, LLC, Westwood Capital LLC,
Paul M. Blythe Mining Associates Inc., Jonathan G. Lee Partners
LLC, Paul Blythe ("Blythe"), Nathan Milikowsky ("Milikowsky"),
Mark Radzik ( "Radzik") , Henry Park ("Park") and Jonathan Lee
("Lee") (collectively "Defendants"), alleging violations of
Section 13 (d) of the Securities Exchange Act of 1934 ("Exchange
Act").
This matter is before the Court on Defendants' Motion to
Dismiss ("Motion") [Dkt. No. 28]. Upon consideration of the Motion,
Opposition [Dkt. No. 34], Reply [Dkt. No. 36], and the entire
record herein, and for the reasons set forth below, the Motion
shall be granted in part and denied in part.
1
I . Background
A. Factual Overviewl
Taseko is a Canadian-based mining company whose shares are
traded on both the NYSE MKT and the Toronto Stock Exchange. Amended
Complaint 'II 2 ("Am. Compl. ") [ Dkt. No. 13] . Defendant Raging River
Capital LP, a Delaware limited partnership, was formed in December
2015 in order to acquire Taseko common shares. Id. 'II 16. Defendant
Raging River Capital GP LLC, is the General Partner for Raging
River Capital LP. Id. 'II 1 7. Defendants Granite Creek Partners,
LLC, Westwood Capital LLC, Paul M. Blythe Mining Associates Inc.,
and Nathan Milikowsky are Managing Members of Raging River Capital
GP LLC. Id. 'II'II 18-20, 23. Defendant Jonathan G. Lee Partners LLC
is a Member of Raging River Capital GP LLC. Id. 'II 21. Defendants
Paul Blythe, Mark Radzik, and Henry Park have been nominated by
Defendants for seats on Taseko's Board. Id. 'II'II 22, 24-25. Radzik
is also the Managing ·Partner of Granite Creek Partners, LLC, and
Park is the Chief Investment Officer and Principal of Westwood
Capital LLC. Id. 'II'II 24-25. Defendant Jonathan Lee is the President
1 For purposes of ruling on a motion to dismiss, the factual
allegations of the complaint must be presumed to be true and
liberally construed in favor of the plaintiff. Aktieselskabet AF
21. November 2001 v. Fame Jeans Inc., 525 F.3d 8, 15 (D.C. Cir.
2008); Shear v. Nat'l Rifle Ass'n of Am., 606 F.2d 1251, 1253 (D.C.
Cir. 1979). Therefore, the facts set forth herein are taken from
Plaintiff's Complaint [Dkt. No. 1-2].
2
of Jonathan G. Lee Partners LLC and a Limited Partner of Raging
River Capital LP. Id. ~ 26.
In January 2016, Defendants acquired more than 5% of Taseko
common shares ("Taseko shares") and disclosed their acquisitions
of shares by filing a Schedule 13D on January 13, 2016 ("First
13D"), as required by the Exchange Act. Id. ~ 5. In December 2015
and January and February 2016, Defendants acquired Taseko senior
notes due in 2019 ("Notes"). Am. Compl. ~ 38. During that same
time period, Raging River Capital 2 LLC also acquired Taseko senior
notes due in 2019 ("Additional Notes"). Opp'n at 26.
Shortly after acquiring their shares, Defendants exercised
their rights under the Business Corporations Act (British
Columbia) ("BCBCA") 2 to demand that Taseko convene a shareholder
meeting to vote on the removal of three current Taseko directors
and the addition of four new directors nominated by Defendants.
Id. The shareholder meeting is currently scheduled for May 10,
2016.
On February 26, 2016, Taseko filed a Complaint [Dkt. No. 1]
in this matter, alleging that the First 13D failed to include
information required by§ 13(d) of the Exchange Act and is false
and misleading. In response, Defendants filed an amended Schedule
2 Corporations in Canada can choose to incorporate federally
under the Canada Business Corporations Act ("CBCA"), RSC 1985,
c C-44 (Can.), or provincially under a province's similar law,
such as the BCBCA, SBC 2002, c 57 (Can) .
3
13D on March 9, 2016 ("First Amended 13D"), which included the
original Complaint as an exhibit. See First Amended 13D, Exhibit
2 to Mot. [Dkt. No. 28-2]; Amended Complaint ("Am. Compl.") 17 C.F.R. § 240.13d-101.
Under the Exchange Act, the Schedule 130 shall contain the
following information:
(A) the background, and identity, residence, and
citizenship of, and the nature of such beneficial
ownership by, such person and all other persons by whom
or on whose behalf the purchases have been or are to be
effected;
(B) the source and amount of the funds or other
consideration used or to be used in making the purchases,
and if any part of the purchase price is represented or
is to be represented by funds or other consideration
borrowed or otherwise obtained for the purpose of
acquiring, holding, or trading such security, a
description of the transaction and the names of the
parties thereto, except that where a source of funds is
a loan made in the ordinary course of business by a bank,
as defined in section 78c (a) ( 6) of this title, if the
person filing such statement so requests, the name of
the bank shall not be made available to the public;
(C) if the purpose of the purchases or prospective
purchases is to acquire control of the business of the
issuer of the securities, any plans or proposals which
such persons may have to liquidate such issuer, to sell
its assets to or merge it with any other persons, or to
6
make any other major change in its business or corporate
structure;
(D) the number of shares of such security which are
beneficially owned, and the number of shares concerning
which there is a right to acquire, directly or
indirectly, by (i) such person, and (ii) by each
associate of such person, giving the background,
identity, residence, and citizenship of each such
associate; and
(E) information as to any contracts, arrangements, or
understandings with any person with respect to any
securities of the issuer, including but not limited to
transfer of any of the securities, joint ventures, loan
or option arrangements, puts or calls, guaranties of
loans, guaranties against loss or guaranties of profits,
division of losses or profits, or the giving or
withholding of proxies, naming the persons with whom
such contracts, arrangements, or understandings have
been entered into, and giving the details thereof.
15 U.S.C. 78m(d) (1).
II. Legal Standard
A. Standard of Review Under Fed. R. Civ. P. 12(b) (6)
To survive a motion to dismiss under Rule 12(b) (6) for failure
to state a claim upon which relief can be granted, a plaintiff
need only plead "enough facts to state a claim to relief that is
plausible on its face" and to "nudge[ ] [his or her] claims across
the line from conceivable to plausible." Bell Atlantic Corp. v.
Twombly, 550 U.S. 544, 570 (2007). "[O]nce a claim has been stated
adequately, it may be supported by showing any set of facts
consistent with the allegations in the complaint." Id. at 563.
Under the Twombly standard, a "court deciding a motion to
dismiss must not make any judgment about the probability of the
7
plaintiffs' success . [,] must assume all the allegations in
the complaint are true (even if doubtful in fact) [, and]
must give the plaintiff the benefit of all reasonable inferences
derived from the facts alleged." Aktieselskabet AF 21. November
2001 v. Fame Jeans Inc., 525 F.3d 8, 17 (D.C. Cir. 2008) (internal
quotation marks and citations omitted). The court shall not,
however, accept as true "legal conclusions or inferences that are
unsupported by the facts alleged." Ralls Corp. v. Comm. on Foreign
Inv. in U.S., 758 F.3d 296, 315 (D.C. Cir. 2014) (citation
omitted). Furthermore, a complaint which "tenders 'naked
assertion[s]' devoid of 'further factual enhancement'" will not
suffice. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 557) (alteration in Iqbal).
B. PLSRA
"As a check against abusive litigation in private securities
fraud actions, the Private Securities Litigation Reform Act of
1995 (PSLRA) includes exacting pleading requirements," beyond the
requirements of Rule 12 (b) (6). Tellabs, Inc. v. Makor Issues &
Rights, Ltd., 551 U.S. 308, 308 (2007). The PSLRA requires that a
plaintiff asserting a violation of the federal securities laws
based on a false or misleading statement must "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,
8
state with particularity all facts on which that belief is formed."
15 U.S.C. § 78u-4 (b) (1).
Put differently, the Court "must ascertain whether the
complaint states sufficient facts to permit a reasonable person to
find that the plaintiff satisfied this element of his claim-that
the defendant made a false or misleading statement." Teachers'
Ret. Sys. of Los Angeles v. Hunter, 477 F.3d 162, 173 (4th Cir.
2007). In evaluating the facts, the Court should consider: "the
number and level of detail of the facts; the plausibility and
coherence of the facts; whether sources of the facts are disclosed
and the apparent reliability of those sources; and any other
criteria that inform how well the facts support the plaintiff's
allegation that defendant's statements or omissions were
misleading." Id. at 174.
III. Analysis
A. The Amended Complaint Is Subject to the PSLRA's Pleading
Requirements
As an initial matter, Taseko contends that its Amended
Complaint is not subject to the PSLRA pleading requirements,
arguing that the pleading requirements apply only to "securities
fraud actions." Opp' n at 2. The basis for Taseko' s argument is
that the section heading for 15 U.S.C. § 78u-4(b) (the heightened
pleading requirements) reads, "Requirements for securities fraud
actions," and Taseko contends that this is _not a fraud action. Id.
9
The plain language of the statute suggests otherwise. Our
Court of Appeals has consistently held that "[t]he plain meaning
of a statute cannot be limited by its title." Nat'l Ctr. for Mfg.
Scis. v. Dep't of Def., 199 F.3d 507, 511 (D.C. Cir. 2000) (citing
Pennsylvania Dep't of Corrections v. Yeskey, 524 U.S. 206 (1998)).
Taseko's claim is based on 15 U.S.C. 78m(d) (Section 13(d) of
the Exchange Act), which is found in the same chapter as .Section
78u-4(b). Section 78u-4(b) specifically states that its pleading
requirements apply to "any private action arising under this
chapter in which the plaintiff alleges that the defendant (A) made
an untrue statement of a material fact; or (B) omitted to state a
material fact necessary in order to make the statements made, in
the light of the circumstances in which they were made, not
misleading." 15 U.S.C. § 78u-4 (b) (1) (emphasis added). With such
clear statutory language, it is difficult to see how the PLSRA's
heightened pleading requirements could not apply.
In addition to the pleading requirements, Section 78u-4(b)
also contains the PSLRA's automatic stay of discovery provisions,
which Taseko did not dispute were applicable in this instance. See
Motion to Lift Stay at 8. In other words, even though both the
pleading requirements and the stay provisions are in the section
titled "Requirements for securities fraud actions," Taseko argues
that only the stay provisions are applicable to the case at hand.
10
15 U.S. C. § 7 Bu-4 (b) . Such inconsistency within the statute is
highly unlikely.
For these reasons, the Court finds that Taseko' s Amended
Complaint is subject to the heightened pleading requirements of
the PSLRA. 3
B. Plaintiff Has Sufficiently Stated a Claim
Defendants argue that Taseko has not pled facts sufficient to
satisfy the heightened pleading requirements of the PSLRA. See
Mot. at 11. They argue that mere speculation that additional
information might exist which should have been disclosed is not
sufficient to meet the PSLRA pleading standards. Id. at 12. With
regard to Taseko's allegations of false or misleading statements~
Defendants contend that Taseko must demonstrate with specificity
why and how they are false or misleading. Id.
1. Specific Sources of Funds
In its Amended Complaint, Taseko alleges that Defendants
failed to disclose "the specific source of funds provided by each
3 Defendants allege that the Amended Complaint must also "state
with particularity facts giving rise to a strong inference that
the defendant acted with the required state of mind." Mot. at 12
(quoting 15 U.S.C. § 78u-4 (b) (2) (A)). This is incorrect. The
scienter requirement applies only to actions "in which the
plaintiff may recover money damages," 15 U.S. C. § 7 Bu-4 (b) ( 2) (A) ;
see also SEC v. e-Smart Technologies, Inc., 82 F. Supp. 3d 97, 104
( D. D. C. 2015) ( "scienter is unnecessary to establish a violation
of Section 13(d) (l)"). The Amended Complaint does not seek money
damages. See Am. Compl. at 20-21. Accordingly, there is no scienter
requirement.
11
limited partner of Raging River Capital LP" to purchase Taseko
shares and notes. Am. Compl. ~ 35. The First Amended 13D states,
in response to question number 4, "Source of Funds," that the
acquisitions were funded out of Raging River Capital LP's working
capital (abbreviated as "WC" per the Schedule 13D instructions) .
First Amended 13D at 2.
Al though Defendants contend that no further disclosure is
required, Mot. at 14, they nonetheless disclosed "the capital
contributions of each [of] the limited partners to Raging River
[Capital LP]" "for the purposes of purchasing the Common Shares
and the Notes" in the Third Amended 13D. Third Amended 13D at 2.
Attached to the Third Amended 13D is a chart listing the capital
contributions of each of the partners of Raging River LP. Third
Amended 13D at 5 (Exhibit 99.11). Defendants argue that Taseko's
request for this information is now moot. Reply at 8-9.
Given Defendants' disclosure, the Court need not decide
whether such disclosure was required by Section 13D. Taseko asked
for "[t]he amount of funds provided by each limited partner of
Raging River Capital LP for the purchase of Taseko shares and
Notes," Opp'n at 13, which Defendants have now provided.
Accordingly, Taseko's claim is moot and will be dismissed.
12
2. Purpose of the Acquisition
Taseko's next claim is that Defendants have not sufficiently
stated the purpose for which they acquired the Taseko Notes, as
required by Item 4 of Schedule 13D.
In its Opp'n, Taseko quotes a portion of Defendants' First
Amended 13D, discussing the purchases of the Notes:
In December 2015 and January and February 2016, the
Reporting Persons acquired the Issuer's 7.75% senior
notes due 2019 with an aggregate cost of $6,040,323
(excluding accrued interest) (the "Notes") . In
addition to the Notes acquired by the Reporting
Persons, Raging River Capital 2 LLC ("RC 2 LLC"), a
Delaware limited liability company established solely
as an investment vehicle for Notes of the Issuer,
acquired in December 2015 and February 2016, the
Issuer's 7.75% senior notes due 2019 with an
aggregate cost of $2,873,737 (excluding accrued
interest) (th~ "Additional Notes") .
Opp'n at 26 (quoting First Amended 13D at 13). Taseko points to
this quote as evidence of Defendants' failure to state a purpose
for the purchase of the Notes. Defendants point out that the quote
omits a later portion of the same paragraph in which Defendants
state that Raging River Capital 2 LLC acquired the Additional Notes
"for investment purposes because it believed that they represented
an attractive investment opportunity." First Amended 13D at 13.
What Defendants overlook though, is that this only provides an
explanation for the purpose of the Additional Notes acquired by
Raging River Capital 2 LLC (not a party to this case), not the
Notes acquired by Defendants.
13
In the Third Amended 13D, Defendants state "that they acquired
the Notes for investment purposes because they believed the Notes
represented an attractive investment opportunity" and that they
"also intend to pursue a concerned shareholder campaign in respect
of the Issuer" Third Amended 13D at 2. This description of
Defendants' purpose in acquiring the Taseko Notes is nearly
identical to its stated purpose for acquiring the Taseko shares,
and Taseko does not dispute the adequacy of that disclosure. See
Opp'n at 26-27. Therefore, the Court finds that the Third Amended
13D has mooted Taseko's claim for information regarding the purpose
for which Defendants acquired the Notes. As such, the Court need
not address the parties' di$pute as to whether Schedule 13D
requires the disclosure of this information and this claim is
dismissed.
3. Alleged Failure to Disclose Agreements
Next, Taseko alleges that Defendants have not disclosed all
of their agreements and arrangements with respect to Taseko
securities. Am Compl. `` 47-52; Opp'n at 27. In particular, Taseko
alleges that "there are almost certainly undisclosed agreements or
14
.
understandings" involving Randy Davenport 4 and/ or Jonathan Lee. 5
Opp' n at 27-28. Taseko also alleges the likely existence of a
contract with Wanxiang America, the sole investor in Raging River
Capital 2 LLC, concerning the possible sale of a copper mining
asset owned by Taseko. Id. at 10-11, 28. Taseko infers this from
Wanxiang's involvement in Raging River Capital 2 LLC, as well as
Wanxiang's past interest in purchasing the copper mine.
Item 6 of Schedule 13D requires the filer to "[d]escribe any
contracts, arrangements, understandings or relationships (legal or
otherwise) among the [filers] and between such persons and any
person with respect to any securities of the issuer . ,, 1 7
C.F.R. § 240.13d-101.
Defendants argue that Plaintiff has failed to allege facts
showing that any of the Defendants have an undisclosed agreement
with "any other stockholder beside the Reporting Persons to 'act
together for the purpose of acquiring, holding, voting or disposing
of equity securities' of Taseko, which is required for a 'group'
to exist (or that there is any requirement to disclose 'contracts,
4 Mr. Davenport is one of Raging River's nominees to Taseko's Board
of Directors and his company, RL Davenport Resources, Inc., is a
limited partner in Raging River Capital LP. First Amended 13D at
13; Opp'n at 27.
5 Defendant Lee allegedly "orchestrated the Defendants' purchases
of Taseko common shares from a Taseko insider." Opp'n at 28. Lee
is also a limited partner in Raging River Capital LP and his
company, Jonathan G. Lee Partners LLC, is a member of Raging River
Capital GP LLC. First Amended 13D at 14; Opp'n at 28.
15
arrangements, understandings and/or relationships between
Defendants and such other Taseko shareholders' when a 'group' does
not exist[)]." Mot. at 17 (quoting 17 C.F.R. § 240.13d-5(b) (1) 6 ).
Item 6 is broad and, contrary to Defendants'
characterization, its requirements stand independent of whether or
not a "group" exists. Item 6 clearly encompasses agreements between
filers "and any person with respect to any securities of the
issuer." Id. (emphasis added) . Not all parties to the agreements
need to be members of a "group" and nothing in Item 6 suggests
that its requirements are contingent on the existence of a "group."
Defendants argue that they have satisfied the reporting
requirements of the Exchange Act and mooted Plaintiff's claim by
attaching Taseko's complaints to their Schedule 13Ds. Defendants
claim they are "not required to adrni t allegations in a Schedule
13D that [they] dispute [] in good faith." Mot. at 15 (quoting
Cartica Mgmt., LLC v. Corpbanca, S.A., 50 F. Supp. 3d 477, 494
(S.D.N.Y. 2014)); Reply at 12. When "the record demonstrates that
there is a dispute as to the facts, the law requires only that the
disputed facts and possible outcomes be disclosed." Cartica Mgmt.,
6 The statute reads: "When two or more persons agree to act together
for the purpose of acquiring, holding, voting or disposing of
equity securities of an issuer, the group formed thereby shall be
deemed to have acquired beneficial ownership, for purposes of
sections 13 ( d) of all equity securities of that issuer
beneficially owned by any such persons." 17 C.F.R. § 240.13d-
5(b)(l).
16
50 F. Supp. 3d at 495-96 (quoting Avnet, Inc. v. Scope Indus., 499
F. Supp. 1121, 1125-26 (S.D.N.Y.1980)).
Defendants "unequivocally state that they have disclosed all
contracts, arrangements, understandings and relationships that are
required to be disclosed by Rule 13(d) and the regulations
promulgated thereunder." Reply at 11. Defendants continue that,
because there is a dispute as to the fact of the existence of any
such agreements, they have satisfied their reporting requirements
by disclosing Plaintiff's allegations. Reply at 12-13.
Unfortunately, Defendants' "unequivocal" statement is unclear
as to whether the dispute relates to facts or the law
specifically the requirements of Rule 13 ( d) . Given Defendants'
incorrectly narrow interpretation of Item 6, Defendants' statement
assures the Court only that they believe they are not required to
disclose any additional agreements under their interpretation of
the law, not that no such agreements exist. Accordingly,
Defendants' attachment of the Amended Complaint to their Schedule
13D disclosures does not discharge their Section 13D obligations
on this issue.
The Court finds that Plaintiff has sufficiently pled facts
regarding possible undisclosed agreements involving Randy
Davenport, Jonathan Lee, and Wanxiang America to survive a motion
to dismiss. Plaintiff's allegations are detailed, plausible, and
coherent, and when considered in light of Defendants' continued
17
reticence to disclose information, including contracts involving
the filing parties, 7 the Court finds that Plaintiff has
sufficiently stated facts that would "permit a reasonable person
to find that the plaintiff satisfied this element of his claim-
that the defendant made a false or misleading statement." Hunter,
477 F.3d at 173. Defendants' request for dismissal of this claim
will be denied.
4. Alleged Failure to Include Jonathan Lee and
Jonathan G. Lee Partners LLC as Reporting Persons
Taseko's final remaining claim is that, based on "Mr. Lee's
role in orchestrating the Defendant's purchase of Taseko common
shares," he and his company should have been included as Schedule
13D reporting persons. Opp'n at 30; Arn. Compl. `` 52, 62-42.
Under the Exchange Act, as noted previously, all beneficial
owners of more than 5% of a security must file a Schedule 130. 17
C.F.R. § 240.13d-1. For purposes of§ 13D, a beneficial owner is:
any person who, directly or indirectly, through any
contract, arrangement, understanding, relationship, or
otherwise has or shares:
(1) Voting power which includes the power to
vote, or to direct the voting of, such security;
and/or,
7 For example, the First 13D did not include the partnership
agreement for Raging River Capital LP, al though the agreement
explicitly states that its principal objective is to effect changes
in Taseko's board of directors by acquiring common shares and bonds
of Taseko and carrying out a concerned shareholder campaign. See
First 13D; First Amended 13D Exhibit 99.3 at 3.1
18
(2) Investment power which includes the power to
dispose, or to direct the disposition of, such
security.
17 C.F.R. § 240.13d-3. Although Defendants have stated that
Jonathan Lee ("Lee") and Jonathan G. Lee Partners LLC ("Lee
Partners") do "not have voting power or investment power,"
Mot. at 18, Plaintiff argues that because Lee is a limited
partner of Raging River Capital, LP and Lee Partners is a
member of Raging R.iver Capital GP LLC, "[a] t the very least,
it is not clear, based on Mr. Lee's investments and
involvements in those special-purpose entities, that he does
not share power over voting and/or disposition of the Taseko
common shares." Opp'n at 31-32.
Such an allegation is not sufficient to meet the pleading
requirements of the PSLRA. Plaintiff does not plead specific
facts to support its allegation that Lee and Lee Partners are
beneficial owners, but instead alleges that it is merely a
possibility that Lee and Lee Partners are beneficial owners.
Next, Plaintiff argues that, even if Mr. Lee cannot
influence the voting or disposition of Defendants' Taseko
shares, he is still required to join as a reporting person on
the Schedule 13D "based on his role in purchasing the Taseko
common shares." Opp' n at 32. As discussed previously, a
"group" for purposes of Section 13D is formed when "two or
more persons agree to act together for the purpose of
19
acquiring, holding, voting or disposing of equity securities
of an issuer." 1 7 C. F. R. § 240 .13d-5. Members of the group
are considered reporting persons. 15 U.S.C. § 78m(d) (3).
Taseko alleges that Lee initiated and participated in
the negotiations and acquisitions of the Taseko shares, and
is therefore a member of the group. Opp'n at 32. Defendants
point to case law holding that a person must have a beneficial
ownership interest in order to be considered a member of the
group. See Hemipherx Biopharma, Inc. v. Johannesburg Consol.
Invs., 553 F.3d 1351, 1363-64 (11th Cir. 2008) (holding that
a person must actually own a beneficial interest in shares in
order to incur reporting liabilities under section 13(d));
Rosenberg v. XM Ventures, 274 F.3d 137, 147 (3d Cir. 2001)
("based upon the statutory and regulatory text, relevant
legislative history, and caselaw from our sister circuits, we
conclude that . . . each member of a section 13(d) group must
hold beneficial ownership of the shares of the issuing entity
prior to becoming a section 13(d) group member").
At most, there is a disputed factual question as to
whether Lee was part of the "group." Defendants once again
argue that, because there is a genuine factual dispute and
they have "disclosed all material facts regarding Taseko's
position on this issue," the claim is moot. Reply at 16;
Avnet, 499 F. Supp. at 1125 (the "purpose of the disclosure
20
,,
provisions of the securities laws is to see to it that the
[shareholder] discloses to the investor the facts as truly
believed by the discloser. When, as here, the record
demonstrates that there is a dispute as to the facts, the law
requires only that the disputed facts and the possible
outcomes be disclosed") .
Plaintiffs have not sufficiently alleged facts to show
that Lee or Lee Partners were required to file Schedule 13Ds.
Even if they had, to the extent there would have been a
genuine dispute as to the facts of Lee and Lee Partners'
status as beneficial owners or members of a group, Defendants
have made adequate disclosures in their Schedule 13D filings,
which include Taseko's allegations. See First Amended 13D.
Accordingly, Defendants' motion will be granted and this
claim will be dismissed.
IV. Conclusion
For all of the foregoing reasons, Defendants' Motion to
Dismiss is granted in part and denied in part. An Order shall
accompany this Memorandum Opinion.
April 26, 2016 Gli:i.dys Ke ler
United States District Judge
Copies to: attorneys on record via ECF
21