D. Neubronner v. Michael R. Milken

Dieter Neubronner appeals the district court’s dismissal with prejudice of his fifth amended complaint against Michael Milken purporting to state a cause of action for securities law fraud under section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and Securities and Exchange Commission Rule 10b-5, 17 C.F.R. § 240 .-10b-5. Neubronner alleged that Milken engaged in “insider” trading and made material misrepresentations in connection with the stock of Gibralter Financial Corporation and its wholly owned subsidiary Gibralter Savings. Neubronner lost approximately $7.5 million as a result of his investments in Gi-bralter securities. We have jurisdiction over Neubronner’s timely appeal pursuant to 28 U.S.C. § 1291 .

I. BACKGROUND

Between April 1, 1987, and November 14, 1988, Dieter Neubronner purchased a total of 1,235,900 shares of Gibralter Financial Corporation’s (“GFC” or “Gibralter”) common stock, which he then sold between November 29, 1988, and February 8, 1989, for a loss of approximately $7.5 million. The value of the company’s stock had declined dramatically after GFC announced on October 30, 1987, approximately $230 million in losses attributable to its…