Public Employees Retirement System of Mississippi v. Qualcomm, Inc.

NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
PUBLIC EMPLOYEES RETIREMENT
SYSTEM OF MISSISSIPPI,
Plaintiff-Appellant,
v.
QUALCOMM, INC.; STEVEN M.
MOLLENKOPF; DEREK K. ABERLE;
GEORGE S. DAVIS; VENKATA S.M.
RENDUCHINTALA; TIM MCDONOUGH;
CRISTIANO R. AMON,
Defendants-Appellees.
No. 18-55005
D.C. No.
3:15-cv-02678-MMA-WVG
MEMORANDUM*
Appeal from the United States District Court
for the Southern District of California
Michael M. Anello, District Judge, Presiding
Argued and Submitted July 11, 2019
Pasadena, California
Before: M. SMITH and FRIEDLAND, Circuit Judges, and SIMON,** District
Judge.
Plaintiff Public Employees Retirement System of Mississippi appeals the
* This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
** The Honorable Michael H. Simon, United States District Judge for the
District of Oregon, sitting by designation.
FILED
JUL 23 2019
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS

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district court’s dismissal of its claims against Qualcomm, Inc. (Qualcomm) and
several of its corporate officers (collectively, Defendants) under § 10(b) of the
Securities Exchange Act of 1934 (Exchange Act) and Rule 10b-5, and § 20(a) of
the Exchange Act. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we
affirm.
1. We agree with the district court that Defendants’ statements made prior to
January 28, 2015 are not actionable misrepresentations or omissions. See
Halliburton Co. v. Erica P. John Fund, Inc., 573 U.S. 258, 267 (2014) (“To
recover damages for violations of section 10(b) and Rule 10b-5, a plaintiff must
prove ‘“[] a material misrepresentation or omission by the defendant . . .”’”
(quoting Amgen Inc. v. Conn. Ret. Plans & Tr. Funds, 568 U.S. 455, 460 (2013))).
Plaintiff alleges that Samsung, a major Qualcomm customer, abandoned use
of the Snapdragon 810 chip due to purported overheating. Plaintiff claims that
Defendants made misrepresentations when they implied that smartphone
manufacturers would utilize the chip, and that Qualcomm would “be able to
maintain [its] leadership position in the premium-tier.” But Qualcomm had no
affirmative duty to disclose Samsung’s alleged abandonment. See In re Rigel
Pharm., Inc. Sec. Litig., 697 F.3d 869, 880 n.8 (9th Cir. 2012). Instead, “[a]n
actionable omission claim arises only when disclosure is ‘necessary . . . to make
the statements made, in light of the circumstances under which they were made,

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not misleading.’” Retail Wholesale & Dep’t Store Union Local 338 Ret. Fund v.
Hewlett-Packard Co., 845 F.3d 1268, 1278 (9th Cir. 2017) (second alteration in
original) (quoting 17 C.F.R. § 240.10b-5(b)). We conclude that Defendants’
statements regarding continued industry leadership were the sorts of “vague,
optimistic statements” that constitute nonactionable “puffery.” Lloyd v. CVB Fin.
Corp., 811 F.3d 1200, 1207 (9th Cir. 2016). And because Plaintiff’s complaint
alleges that other smartphone manufacturers used the Snapdragon 810, we cannot
conclude that Defendants’ assertion that manufacturers generally would use the
chip was materially misleading even though they omitted mention of Samsung’s
abandonment.
We also conclude that the various “on-track” and similar “no delay”
statements made between December 2014 and January 2015 are nonactionable.
“[N]on-forward-looking statements” that “repeatedly reassure[] investors” in such
a way that “affirmatively create[s] an impression of a state of affairs that differ[s]
in a material way from the one that actually exist[s]” are actionable. In re Quality
Sys., Inc. Sec. Litig., 865 F.3d 1130, 1144 (9th Cir. 2017) (quoting Brody v.
Transitional Hosps. Corp., 280 F.3d 997, 1006 (9th Cir. 2002)). But here, Plaintiff
alleges that the first smartphone that incorporated the Snapdragon 810—the LG G
Flex 2—launched on January 5, 2015, just as the on-track statements indicated.
We thus cannot conclude that such statements were either false or affirmatively

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misleading.
2. As to alleged misstatements made after January 28, 2015, we conclude that
Plaintiff did not adequately plead loss causation. See Halliburton, 573 U.S. at 267.
“‘[L]oss causation’ [is] the plaintiff’s ‘burden of proving that the act or omission of
the defendant alleged to violate this chapter caused the loss for which the plaintiff
seeks to recover damages.’” Mineworkers’ Pension Scheme v. First Solar Inc.,
881 F.3d 750, 753 (9th Cir. 2018) (quoting 15 U.S.C. § 78u-4(b)(4)). Here,
although the district court erred in its reliance on Loos v. Immersion Corp., 762
F.3d 880 (9th Cir. 2014), we affirm its conclusion because Plaintiff has failed to
allege the necessary “causal connection” between the purported misrepresentations
and the resulting loss. Dura Pharm., Inc. v. Broudo, 544 U.S. 336, 347 (2005); see
also Nuveen Mun. High Income Opportunity Fund v. City of Alameda, 730 F.3d
1111, 1119 (9th Cir. 2013) (explaining that “other contributing forces [to the
investment’s decline in value] will not bar recovery” so long as the
misrepresentation was at least a “substantial cause” of the loss) (quoting In re
Daou Sys., Inc., 411 F.3d 1006, 1025 (9th Cir. 2005))).1
AFFIRMED.
1 Because we affirm dismissal of Plaintiff’s claim under § 10(b), we also affirm
dismissal of its claim under § 20(a). See No. 84 Emp’r-Teamster Joint Council
Pension Tr. Fund v. Am. W. Holding Corp., 320 F.3d 920, 945–46 (9th Cir. 2003).

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