Zumpano

MEMORANDUM **

In this securities fraud class action, plaintiff shareholders appeal the district court’s grant of defendants’ motion to dismiss the First Amended Complaint (“FAC”) under Fed. R. Civ. Prog. 12(b)(6) for failure to state a claim. The Private Securities Litigation Reform Act sets forth a heightened pleading standard, which requires plaintiffs to plead specific facts both establishing falsity and giving rise to a strong inference of scienter. 15 U.S.C. § 78u-4(b)(l)(B); In re Silicon Graphics Inc. Secs. Litig., 183 F.3d 970, 985 (9th Cir.1999) (requiring “strong inference” of scienter). Because the FAC fails to do either, we affirm.

Plaintiffs allege that defendants knew at the time they announced the forecast for the second quarter of 2001 (“2Q01”) that the forecast was unrealistically optimistic, and that defendants knew there was no way Juniper would be able to achieve its predictions. However, the FAC does not plead specific facts establishing that the forecast was false when made. See In re Syntex Corp. Secs. Litig., 95 F.3d 922, 934 (9th Cir.1996) (“Because Defendants’ predictions proved to be wrong in hindsight does not render the statements untrue when…