NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 19 2024
MOLLY C. DWYER, CLERK
FOR THE NINTH CIRCUIT U.S. COURT OF APPEALS
In re: INTEL CORPORATION No. 23-15695
SECURITIES LITIGATION,
______________________________ D.C. No. 5:20-cv-05194-EJD
KBC ASSET MANAGEMENT NV; SEB
INVESTMENT MANAGEMENT AB, Lead MEMORANDUM*
Plaintiffs,
Plaintiffs-Appellants,
v.
INTEL CORPORATION; et al.,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of California
Edward J. Davila, District Judge, Presiding
Argued and Submitted April 1, 2024
San Francisco, California
Before: HURWITZ and JOHNSTONE, Circuit Judges, and MORRIS,** District
Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable Brian M. Morris, Chief Judge for the District of
Montana, sitting by designation.
Plaintiffs KBC Asset Management NV and SEB Investment Management
AB appeal the dismissal of this securities fraud putative class action against Intel
Corporation and its former officers Robert Swan, George Davis, and Venkata
Renduchintala (collectively, “Intel”). We review de novo the district court’s
dismissal of a complaint under Federal Rule of Civil Procedure 12(b)(6) and the
Private Securities Litigation Reform Act (“PSLRA”). See In re Quality Sys., Inc.
Sec. Litig., 865 F.3d 1130, 1140 (9th Cir. 2017). We accept as true all plausible
factual allegations in the complaint, Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009),
and view those allegations in the light most favorable to the plaintiffs, Weston
Fam. P’ship LLLP v. Twitter, Inc., 29 F.4th 611, 617 (9th Cir. 2022). We have
jurisdiction under 28 U.S.C. § 1291. We affirm.
1. “Timeline” statements. Plaintiffs failed to adequately allege materially false
or misleading statements or omissions about Intel’s 7-nanometer product launch
timeline that were not protected by the PSLRA’s safe harbor for “forward-looking”
statements. See 15 U.S.C. § 78u-5(c)(1). Plaintiffs challenged statements that
Intel’s announced “timeline” for 7-nanometer product launch dates remained
“unchanged” and “on track,” and that there was “nothing new” to report. But a
“statement that a company is ‘on track’ to achieve an announced objective [is]
merely [an] alternative way[] of declaring or reaffirming the objective itself.”
Wochos v. Tesla, Inc., 985 F.3d 1180, 1192 (9th Cir. 2021).
Here, as in Wochos, Plaintiffs failed to plead that Intel’s timeline required
intermediate checkpoints to be met, let alone that such checkpoints were missed
before the statements at issue. Plaintiffs thus failed to plead with particularity that
any defendant had “actual knowledge,” when making the challenged statements,
that Intel would miss the projected product release dates. 15 U.S.C. § 78u-
5(c)(1)(B).
Plaintiffs also failed to plead scienter with particularity as to the “timeline”
statements. They rely largely on anonymous sources, but have not provided
sufficient factual allegations as to the sources’ reliability or personal knowledge.
See Zucco Partners, LLC v. Digimarc Corp., 552 F.3d 981, 995 (9th Cir. 2009), as
amended (Feb. 10, 2009). As the district court explained, “Plaintiffs’ allegations
paint a picture that there were problems with Intel’s [7-nanometer] development,”
and that the individual defendants may have been aware that those problems
existed. In re Intel Corp. Sec. Litig., No. 5:20-CV-05194, 2023 WL 2767779, at
*25 (N.D. Cal. Mar. 31, 2023). “The allegations go no further, though,” id., and do
not create “a strong inference that the defendant[s] acted with . . . intent to deceive,
manipulate, or defraud,” or with “deliberate recklessness,” in announcing and
affirming 7-nanometer product release dates. Quality Sys. at 1144 (cleaned up)
(citing 15 U.S.C. § 78u-4(b)(2)(A)). Nor do they support a “core operations
inference.” See S. Ferry LP, No. 2 v. Killinger, 542 F.3d 776, 786 (9th Cir. 2008)
(noting that, “without accompanying particularized allegations,” the inference
applies only in “rare circumstances”).
2. Other statements. Plaintiffs also challenge statements about: 1) lessons Intel
learned from its 10-nanometer process that it applied to its 7-nanometer process; 2)
Intel’s status as an integrated device manufacturer; and 3) the departure of
microprocessor architect Jim Keller. A statement is misleading if it “would give a
reasonable investor the impression of a state of affairs that differs in a material way
from the one that actually exists.” E. Ohman J:or Fonder AB v. NVIDIA Corp., 81
F.4th 918, 928 (9th Cir. 2023) (cleaned up). The PSLRA requires that “the
complaint state with particularity all facts on which the belief underlying an
allegation of falsity is formed.” Id. at 942 (cleaned up) (citing 15 U.S.C. § 78u-
4(b)(1)(B)). Plaintiffs failed to plead with particularity that the challenged
statements were false or misleading when made, and also failed to plead facts
supporting a “strong inference” of scienter as to these statements. See Tellabs, Inc.
v. Makor Issues & Rts., Ltd., 551 U.S. 308, 326 (2007).
3. Control person liability. Plaintiffs’ control persons claim under 15 U.S.C. §
78t(a) fails because their underlying claims fail. See, e.g., Prodanova v. H.C.
Wainwright & Co., LLC, 993 F.3d 1097, 1113 (9th Cir. 2021).
AFFIRMED.