Peltz

MEMORANDUM *

Plaintiffs in this purported class action appeal from the district court’s summary judgment in favor of the defendants. The district court had jurisdiction under 15 U.S.C. § 78aa, 28 U.S.C. § 1331 and 28 U.S.C. § 1367 . We have jurisdiction over this timely appeal by 28 U.S.C. § 1291 . We affirm in part, reverse in part, and remand.

‘We conduct [a] de novo review of the district court’s ... summary judgment. In so doing, we are mindful that, although *318 materiality and scienter are both fact-specific issues which should ordinarily be left to the trier of fact, summary judgment may be granted in appropriate cases.” Software Toolworks Inc. Sec. Litig. v. PaineWebber Inc., 50 F.3d 615, 620 (9th Cir.1994).

I.

Plaintiffs advance two theories of liability under Rule 10b-5: 1) that Polyphase made material misstatements and 2) that individuals connected with Polyphase engaged in insider trading. 17 C.F.R. § 240 .10b-5.

A.

We first confirm that Polyphase may be liable under the fraudulent misstatement theory whether or not it bought or sold securities during the time period in question. All that is required is for a misstatement to be made “in connection with” a…