Robert Kaplan v. Gerard Charlier

MEMORANDUM

Plaintiff Robert J. Kaplan appeals from the district court’s dismissal, for failure to state a claim, of his complaint alleging securities fraud by Gaming Partners International (GPI) and its executives. We affirm.

Kaplan alleges that GPI’s financial statements contained materially false or misleading statements regarding GPI’s products, business prospects, and accounting practices. However, Kaplan has failed to meet the requirement that a plaintiff “plead with particularity both falsity and scienter.” Gompper v. VISX, Inc., 298 F.3d 893, 895 (9th Cir.2002).

A statement is misleading if it “affirmatively create[s] an impression of a state of affairs that differs in a material way from the one that actually exists.” Brody v. Trans. Hosp. Corp., 280 F.3d 997, 1006 (9th Cir.2002). None of the identified statements about GPI’s products and business prospects are misleading. Instead, Kaplan’s complaint is based on a fundamental misreading of these statements. The complaint rests on the premise that GPI held itself out as a provider of a “complete package” of gaming chips, hardware, and software to casinos, but there is no indication in any of the identified statements…