Stephen Merritt v. Barclays PLC

Opinion

1 O 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 CENTRAL DISTRICT OF CALIFORNIA 11 12 Case No.: 2:23-cv-09217-MEMF-KS STEPHEN MERRITT, Individually and on 13 Behalf of All Others Similarly Situated, AMENDED* ORDER DENYING STALEY’S 14 Plaintiff, MOTION TO DISMISS [ECF NO. 56] AND GRANTING IN PART BARCLAYS BANK’S 15 v. MOTION TO DISMISS [ECF NO. 58] 16 17 BARCLAYS PLC, JAMES E. STALEY, and NIGEL HIGGINS, 18 Defendants. 19 20 21 Before the Court is a Motion to Dismiss filed by Defendant James Staley (ECF No. 56) and a 22 Motion to Dismiss filed by Defendants Barclays PLC (“Barclays Bank”) and Nigel Higgins (ECF 23 No. 58). For the reasons discussed below, the Court DENIES Staley’s Motion to Dismiss and 24 GRANTS IN PART Barclays Bank’s Motion to Dismiss with leave to amend. 25 26 27 *The Court issues this amended order in response to Defendant Barclays PLC’s Request for Clarification (ECF No. 85). The Court amends the mentions of “Barclays Bank PLC” in both the caption and the 28 1 BACKGROUND 2 I. Factual Allegations1 3 This case concerns a securities class action on behalf of all persons or entities who (1) 4 purchased or acquired Barclays American Depository Receipts (“ADRs”) traded on the New York 5 Stock Exchange (“NYSE”) from July 22, 2019, through October 12, 2023, inclusive (the “Class 6 Period”) and/or (2) purchased or acquired Barclays ordinary shares traded on the London Stock 7 Exchange (“LSE”) during the Class Period. FAC ¶ 1. 8 Plaintiffs are Teamsters Local 237 Additional Security Benefit Fund and Teamsters Local 9 237 Supplemental Fund for Housing Authority Employees (the “Teamsters”), the Firemen’s 10 Retirement System of St. Louis (the “Firemen”), and members of the putative class (collectively, 11 “Plaintiffs”). Id. ¶¶ 43, 44.2 The Teamsters purchased Barclays ADRs during the Class Period and 12 was appointed Lead Plaintiff on January 2, 2024. See ECF 31. The Firemen purchased ordinary 13 shares during the Class Period. FAC ¶ 44. Plaintiffs are citizens of the United States. FAC ¶ 33. 14 Defendant Barclays Bank is a multinational bank and publicly held company headquartered 15 in London. Id. ¶ 45. Barclays ADRs are traded on the NYSE under the ticker symbol “BRC.” Id. Its 16 ordinary shares are traded on the LSE under the ticker symbol “BARC.” Id. Defendant Nigel 17 Higgins has served as the Group Chairman of the Board of Barclays Bank (the “Board”) since May 18 2019. Id. ¶ 47. Higgins served on the Board Nominations Committee throughout the Class Period. 19 Id. Defendants Barclay Bank and Higgins are citizens of the United Kingdom. Id. ¶ 33. Defendant 20 James E. Staley served as CEO of Barclays Bank and as a director on its Board from December 1, 21 2015, to October 31, 2021. Id. ¶ 46.3 22 23 24 1 The following factual background is derived from the allegations in Plaintiffs’ First Amended Complaint, ECF No. 52 (“FAC”), except where otherwise indicated. For the purposes of this Motion, the Court treats 25 these factual allegations as true, but at this stage of the litigation, the Court makes no finding on the truth of these allegations, and is therefore not—at this stage—finding that they are true. 26 2 Although the original Complaint was filed by Stephen Merritt which is reflected in the caption for this case, 27 the Court appointed the Teamsters as lead plaintiff in this action on June 11, 2024. ECF No. 9. 3 The Court will refer to Staley and Higgins collectively as the “Individual Defendants,” and along with 28 1 In July 2019, Jeffrey Epstein was arrested on federal charges for sex trafficking of minors. Id. 2 ¶ 13. On July 22, 2019, the New York Times published an article surrounding Epstein’s arrest (the 3 “NYT Article”). Id. ¶ 14. The NYT Article described a longstanding relationship between Epstein 4 and Staley that began when Staley was running JP Morgan’s private bank and Epstein was a client. 5 Id. The NYT Article claimed the relationship was not purely professional and reported that Staley 6 visited Epstein when Epstein was serving a home sentence in 2008 for soliciting prostitution of a 7 minor. Id. ¶ 15. Further press reports soon connected Staley with Epstein. Id. ¶ 17. By August of 8 2019, Bloomberg reported that Staley severed his relationship with Epstein months after sailing to 9 Epstein’s island in the U.S. Virgin Islands when Staley was under consideration for the position as 10 Barclays Bank’s CEO. Id. A Wall Street Journal piece reported Staley had not had contact with 11 Epstein in years. Id. 12 On August 15, 2019, the UK’s Financial Conduct Authority (the “FCA”) contacted Higgins 13 to request a written response detailing how the Board had satisfied itself that there was no 14 impropriety in the relationship between Staley and Epstein. Id. ¶ 19. The resulting letter (the “2019 15 Letter”) was drafted by Barclays Bank’s General Counsel. Id. Staley provided information for the 16 2019 Letter, and both Higgins and Staley made revisions and approved of the language. Id. Barclays 17 Bank sent the 2019 Letter to the FCA on October 8, 2019. Id. ¶ 20. The Letter included three 18 affirmations: (1) Staley did not have a close relationship with Epstein; (2) Staley had not seen 19 anything that would have suggested the misconduct by Epstein; and (3) Staley’s last contact with 20 Epstein was “well before he joined Barclays in 2015.” Id. 21 Shortly after the letter was issued, U.S. investigators sent Barclays Bank a cache of emails 22 between Epstein and Staley that were discovered during its investigations of Epstein. Id. ¶ 21. 23 Barclays Bank engaged a law firm to review the emails, conduct interviews, and provide a report to 24 the Board (the “2020 Barclays Bank Investigation”). Id. On February 13, 2020, Barclays Bank 25 disclosed an FCA investigation into the relationship between Staley and Epstein. Id. ¶ 22. The same 26 day, Barclays Bank issued its 2019 Annual Report (the “2019 Annual Report”) and a press release 27 (the “2020 Press Release”) announcing that Staley “retain[ed] the full confidence of the Board,” and 28 reaffirmed that Staley had been “sufficiently transparent with the Company as regards the nature and 1 extent of his relationship with Mr. Epstein.” Id. Also that day, Staley had an earnings call with 2 analysts and interviews with the press in which he acknowledged he had “a long-standing 3 professional relationship with [Epstein]” and reiterated that the Board found he had been 4 “transparent and open.” Id. ¶ 23. 5 On October 29, 2021, the FCA privately informed Staley and the Board of its preliminary 6 findings. Id. ¶ 26. On November 1, 2021, Barclays Bank issued a press release announcing Staley 7 would step down immediately as CEO (the “2021 Press Release”). Id. ¶ 27. 8 On February 15, 2023, portions of a complaint filed in a lawsuit brought by the Virgin 9 Islands against JPMorgan Chase (the “USVI Complaint”) were unredacted, revealing a more 10 complete email record between Staley and Epstein to the public. Id. ¶ 28. On March 24, 2023, 11 Barclays Bank issued its Notice of Annual General Meeting 2023, including a letter signed by 12 Higgins (the “2023 Letter”). Id. ¶ 98. Despite the 2020 Barclays Bank Investigation into the email 13 cache, the 2023 Letter maintained that the Board’s February 2020 expression of full confidence in 14 Staley had been based on “the information it had at the time and the representations made by 15 Staley.” Id. ¶ 98. 16 On October 12, 2023, the FCA issued a decision notice (the “FCA Decision Notice”) on the 17 results of its investigation into the relationship between Staley and Epstein. Id. ¶ 29. The FCA found 18 Staley acted “recklessly” in approving the 2019 Letter. Id. The FCA further found that the 2019 19 Letter contained two misleading statements about the nature of the relationship between Epstein and 20 Staley, and the date of their last contact. Id. The FCA fined Staley and banned him from holding a 21 senior management position in the financial services industry. Id. 22 Also on October 12, 2023, Barclays Bank issued a press release on the FCA Decision Notice 23 (the “2023 Press Release”). Id. ¶ 111. The 2023 Press Release disclosed conclusions by the Board’s 24 Remuneration Committee detailing a number of awards for which Staley was no longer eligible 25 along with deferred compensation awards, amounting to a total value of £17.8 million. Id. ¶ 112. 26 That day, the price of Barclays ADRs and ordinary shares declined by 4.99% and 3.12% 27 respectively. Id. ¶ 30. 28 1 II. Procedural History 2 The FAC, filed on August 12, 2024, brings three causes of action against Defendants. See 3 generally FAC. Count 1 alleges that Defendants violated § 10(b) of the Securities Exchange Act 4 (“SEA”) and Rule 10b-5 by knowingly or with reckless disregard disseminating or approving of 5 statements containing material misrepresentations, thereby inflating the price of Barclays Bank’s 6 NYSE-traded ADRs during the Class Period. See id. ¶¶ 132-43. Count 2 alleges that Defendants 7 violated their duty to disseminate accurate and truthful information as “controlling persons” of 8 Barclays Bank and thereby participated in conduct that inflated the market price of Barclays Bank’s 9 ADRs, in violation of § 20(a) of the SEA. See id. ¶¶ 144-50. Count 3—brought only against 10 Defendants Barclays Bank by the Firemen—alleges that Barclays Bank omitted matters required to 11 be included in published information and knew those omissions to be dishonest concealment of a 12 material facts in violation of Section 90A of the Financial Services and Markets Act (“FSMA”) of 13 the United Kingdom (“Section 90A”). See id. ¶¶ 151–62. 14 On October 30, 2024, Staley brought a Motion to Dismiss. ECF No. 56 (“Staley MTD”). 15 That day, Staley also filed a Request for Judicial Notice in support of his MTD. ECF No. 57 (“Staley 16 RJN”). On January 18, 2025, Plaintiffs filed a response to both. ECF No. 67; ECF No. 66 (“Staley 17 Opp.”). On February 28, 2025, Staley filed a reply in support of the Staley RJN and MTD. ECF No. 18 72; ECF No. 71 (“Staley Reply”). 19 On October 30, 2024, Higgins and Barclays Bank together brought a Motion to Dismiss. 20 ECF No. 58 (“Barclays Bank MTD”). The same day, they filed a Request for Judicial Notice in 21 support of the MTD. ECF No. 60 (“Barclays Bank RJN”). On January 18, 2025, Plaintiffs filed a 22 response to both. ECF No. 68; ECF No. 69 (“Barclays Bank Opp.”). On February 28, 2025, Barclays 23 Bank filed a reply in support of the Barclays Bank RJN and MTD. ECF No. 74; ECF No. 73 24 (“Barclays Bank Reply”). On April 18, 2025, Plaintiffs filed a Notice of Supplemental Authority. 25 ECF No. 76. 26 27 / / / 28 / / / 1 REQUESTS FOR JUDICIAL NOTICE (ECF NOS. 57, 60) 2 I. Applicable Law 3 A court may judicially notice facts that: “(1) [are] generally known within the trial court’s 4 territorial jurisdiction; or (2) can be accurately and readily determined from sources whose accuracy 5 cannot reasonably be questioned.” Fed. R. Evid. 201(b). Under this standard, courts may judicially 6 notice “undisputed matters of public record,” but generally may not notice “disputed facts stated in 7 public records.” Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th Cir. 2001), overruled on other 8 grounds by Galbraith v. County of Santa Clara, 307 F.3d 1119, 1125–26 (9th Cir. 2002). 9 On a motion to dismiss, courts are generally prohibited from “consider[ing] any material 10 beyond the pleadings.” United States v. Corinthian Colleges, 655 F.3d 984, 998 (9th Cir. 2011) 11 (quoting Lee, 250 F.3d at 688). Courts generally only consider the complaint and other materials 12 “submitted with and attached to the Complaint.” Id. at 999. Documents not attached to the 13 complaint—including documents that might otherwise be subject to judicial notice—may only be 14 considered if: “(1) the complaint refers to the document; (2) the document is central to the plaintiff’s 15 claim; and (3) no party questions the authenticity of the document.” Id. (citing Marder v. Lopez, 450 16 F.3d 445, 448 (9th Cir.2006)). 17 II. Discussion 18 A. The Court Grants the Staley RJN (ECF No. 57) 19 In support of the Motion, Staley requests the Court judicially notice: (1) the NYT Article, 20 referenced in the FAC at ¶¶14–16, 52–53, (2) a Financial Times piece published November 12, 2021 21 and quoted by the FAC at ¶¶ 85–86, (3) a Financial Mail on Sunday piece published on November 22 28, 2021 and quoted in the FAC at ¶ 87 (collectively, the “Press Articles”), (4) excerpts of the 23 Barclays Bank 2019 Report, published February 13, 2020 and referenced in the FAC at ¶¶ 22, 68– 24 70, (5) Barclays Bank’s historical stock price data on the NYSE and LSE, referenced in the FAC at 25 ¶¶ 30, 113, (6) excerpts of the USVI Complaint that were unredacted in February of 2023 and quoted 26 in the FAC at ¶¶ 28, 81, 93, 95, and (7) the FCA Decision Notice which is extensively quoted in the 27 FAC at, for example, ¶¶ 4, 19–20, 60, 91. See Staley RJN, Exs. 1-7. 28 1 Plaintiffs object to judicial notice of these materials to establish the truth of facts contained 2 therein, rather than merely to ascertain information that was in the public realm through the Class 3 Period. See Staley RJN Resp. at 2–3. Plaintiffs do not object to judicial notice of any and all of the 4 materials for the “limited purpose of determining what information was available to the public on the 5 date of publication.” Id. at 3. However, as noted above, under Fed. R. Evid. 201(b), Courts generally 6 may not notice disputed facts in public records. Therefore, the Court’s grant of Staley’s RJN is only 7 for the purposes of showing information available in the public realm during the Class Period. 8 i. The Press Articles 9 The Ninth Circuit has taken judicial notice of newspaper articles “as an indication of what 10 information was in the public realm at the time.” See Von Saher v. Norton Simon Museum of Art at 11 Pasadena, 592 F.3d 954, 960 (9th Cir. 2010). For Plaintiffs to prevail, they must show Staley 12 knowingly or recklessly approved of material misrepresentations that misled shareholders and 13 artificially inflated the price of Barclays Bank shares. Thus, proving the information available to 14 shareholders throughout the Class Period is central to Plaintiffs’ case. Because the FAC quotes the 15 Press Articles, no party disputes their authenticity, and the issue of publicly available information is 16 central to Plaintiffs claims, the Court takes judicial notice of the Press Articles. 17 ii. SEC Filings and Stock Price Data 18 The 2019 Report is a Form 20-F, filed with the Securities Exchange Commission (“SEC”). 19 Id. 2. The Ninth Circuit has expressly included SEC filings within the class of public documents 20 subject to judicial notice of public filings. See Dreiling v. Am. Exp. Co., 458 F.3d 942, 946 n.2 (9th 21 Cir. 2006). As above, the 2019 Report is mentioned in the allegations, no party disputes its 22 authenticity, and the issue of publicly available information throughout the Class Period is central to 23 Plaintiff’s claim. Thus, the Court takes judicial notice of the 2019 Report. 24 The Court takes judicial notice of Barclays Bank historical stock price data, referenced in the 25 FAC at ¶ 30. The data is publicly available information, neither party disputes its authenticity, and 26 the fall in share prices is central to proving the harm Plaintiffs suffered as a result of the alleged 27 misrepresentations. 28 / / / 1 iii. The FCA’s Decision Notice & USVI Complaint 2 The Ninth Circuit has granted judicial notice to complaints filed in a federal district court. 3 See MGIC Indem. Corp. v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986) (taking judicial notice of a 4 memorandum filed in a court proceeding). As discussed above, the issue of publicly available 5 information through the Class Period is central to Plaintiff’s claims, the excerpts are referenced in 6 the FAC, and neither party disputes the authenticity of the records. Thus, the Court takes judicial 7 notice of the USVI Complaint. 8 The Court also takes judicial notice of the FCA Decision Notice. The Ninth Circuit has taken 9 judicial notice of documents published by a foreign agency when it was “verifiable with certainty, 10 and of the same type as other governmental documents which courts have judicially noticed.” See 11 Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 1001–02 (9th Cir. 2018), quoting United States 12 v. Camp, 723 F.2d 741, 744 (9th Cir. 1984). No party contests the authenticity of the Decision 13 Notice and it is central to Plaintiff’s claims because its issuance marked the end of the Class Period 14 and contributed, according to Plaintiffs, to the fall in stock prices of Barclays Bank. FAC ¶ 29–30. 15 B. The Court Grants the Barclays Bank RJN (ECF No. 60) 16 In support of their Motion, Barclays Bank and Higgins request the Court judicially notice the 17 items referenced above, in addition to: (1) the 2020 Press Release referenced in the FAC at ¶¶ 22, 18 28, 68–69, 80; (2) the 2021 Press Release referenced in the FAC at ¶¶ 27, 46, 83, 90–91; (3) a 19 second Financial times article published on March 4, 2023, and referenced in the FAC at ¶¶ 62 n.3, 20 96; and (4) Barclays Bank’s 2022 Annual Report, referenced at ¶ 94 of the FAC. Because the Court 21 has already granted judicial notice of the items referenced above, it only considers below the 22 additional four requests made by Barclays Bank and Higgins. 23 i. The Press Releases 24 The 2020 and 2021 Press Releases are also referenced in the Complaint, essential to 25 Plaintiffs’ claims, and their authenticity is not disputed. The Court therefore finds it proper to 26 judicially notice the Press Releases. See Von Saher, 592 F.3d at 960. 27 / / / 28 / / / 1 ii. The 2023 Financial Times Article 2 The 2023 Financial Times article is, like the Press Articles discussed above, the type of 3 material subject to judicial notice in the Ninth Circuit. For the reasons the Press Articles are noticed, 4 the 2023 Financial Times article is also judicially noticed. 5 iii. Barclays Bank 2022 Annual Report 6 The 2022 Report is, like the 2019 Report, a form 20-F SEC filing. For the reasons the 2019 7 Report is noticed, the 2022 Report is also noticed. Thus, the Barclays Bank RJN is granted. 8 MOTIONS TO DISMISS (ECF NOS. 56, 58) 9 I. Applicable Law 10 Defendants bring their Motions to Dismiss pursuant to Federal Rules of Civil Procedure 11 12(b)(6). Federal Rule of Civil Procedure 12(b)(6) allows a party to seek to dismiss a complaint for 12 “failure to state a claim upon which relief can be granted.” “To survive a motion to dismiss, a 13 complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is 14 plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. 15 Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads 16 factual content that allows the court to draw the reasonable inference that the defendant is liable for 17 the misconduct alleged.” Id. Labels, conclusions, and “formulaic recitation of a cause of action’s 18 elements” are insufficient. Twombly, 550 U.S. at 545. 19 The determination of whether a complaint satisfies the plausibility standard is a “context- 20 specific task that requires the reviewing court to draw on its judicial experience and common sense.” 21 Iqbal, 556 U.S. at 679. Generally, a court must accept the factual allegations in the pleadings as true 22 and view them in the light most favorable to the plaintiff. Soo Park v. Thompson, 851 F.3d 910, 918 23 (9th Cir. 2017); Lee, 250 F.3d at 679. But a court is “not bound to accept as true a legal conclusion 24 couched as a factual allegation.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). 25 Allegations of securities fraud under the Exchange Act are subject to heightened pleading 26 standards under Fed. R. Civ. Pro. 9(b). In re Cloudera, Inc., 121 F.4th 1180, 1186 (9th Cir. 2024). 27 The pleading must identify the “who, what, when, where, and how of the misconduct charged as 28 well as what is false or misleading about the purportedly fraudulent statement, and why it is false.” 1 Davidson v. Kimberly-Clark Corp., 889 F.3d 956, 964 (9th Cir. 2018) (internal citation omitted). 2 The Private Securities Litigation Reform Act of 1995 (“PSLRA”) reinforces Rule 9(b) by requiring 3 that the complaint specify each statement alleged to be misleading and the reasons why the statement 4 is misleading. In re Cloudera, Inc., 121 F.4th at 1186. While the PSLRA requires applying a 5 heightened “strong inference” standard specific to the element of scienter, the PSLRA’s particularity 6 requirements do not otherwise make the plausibility standard irrelevant. See Nguyen v. Endologix, 7 Inc., 962 F.3d 405, 414–415 (9th Cir. 2020) (noting that “plausibility is no less relevant in the 8 context of the heightened pleading standards of Rule 9(b) or the PSLRA”). 9 As a general rule, leave to amend a dismissed complaint should be freely granted unless it is 10 clear the complaint could not be saved by any amendment. Fed. R. Civ. P. 15(a); Manzarek v. St. 11 Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). 12 II. Discussion 13 Defendants move to dismiss Count 1 of the FAC contending that Plaintiffs have failed to 14 plead material misstatements, and there is no loss causation. Defendants contend that this failure 15 requires dismissal of Count 2 as well. Barclays Bank also moves on Count 3 contending that this 16 Court should not exercise supplemental jurisdiction over the claim, and that regardless the Firemen 17 have failed to state a Section 90A claim on the merits. For the reasons discussed below, the Court 18 finds that Counts 1 and 2 have been sufficiently pleaded (with the exception of one statement made 19 by Higgins) and that it has jurisdiction over Count 3. However, the Court finds that Count 3 is not 20 sufficiently pleaded. 21 A. The Court Finds Count 1 Sufficiently Pleaded 22 The required elements of a private securities fraud action are (1) a material misrepresentation 23 or omission of fact, (2) scienter, (3) a connection with the purchase or sale of a security, (4) 24 transaction and loss causation, and (5) economic loss. Metzler Inv. GMBH v. Corinthian Colleges, 25 Inc. 540 F.3d 1049, 1061 (9th Cir. 2008). Defendants dispute the sufficiency of a material 26 misrepresentation and loss causation, and Barclays Bank and Higgins further dispute the sufficiency 27 of scienter. The Court finds that all elements of the Section 10(b) claim have been adequately 28 alleged. 1 i. The Court finds the FAC pleads material misstatements. 2 A statement is considered misleading if it “would give a reasonable investor the ‘impression 3 of a state of affairs that differs in a material way from the one that actually exists.’” Retail Wholesale 4 & Dep’t Store Union Loc. 338 Ret. Fund v. Hewlett-Packard Co., 845 F.3d 1268, 1275 (9th Cir. 5 2017). As discussed next, the Court finds that the FAC sufficiently pleads statements that were both 6 plausibly misleading and material.4 7 a. The statement from the NYT Article is plausibly misleading. 8 On July 22, 2019, a Barclays Bank spokesperson was quoted in the NYT Article as saying 9 that “Mr. Staley has never engaged or paid fees to Mr. Epstein to advise him, or to provide 10 professional services, either in his various roles at JPMorgan, or personally[.]” FAC ¶ 53. Drawing 11 all inferences in favor of the complainant, the Court finds that this statement is potentially 12 misleading. As Plaintiffs allege in the FAC, “[t]he relationship between Staley and Epstein was close 13 and personal enough that the offer or solicitation of business advice did not require the payment of 14 fees or a formal engagement,” and that the two did exchange professional guidance and assistance. 15 FAC ¶ 56. Defendants appear to argue that because the statement specifically denies a “paid” 16 relationship without other aspects of the relationship, it cannot be misleading. But the statement does 17 not merely deny a paid relationship or a formal engagement, it denies that Epstein was engaged at 18 all. Further, drawing all inferences in favor of Plaintiffs, a reasonable investor’s interpretation of the 19 statement would be that Staley and Epstein did not advise or provide professional services to each 20 other, whether formally paid or not. It would be difficult to believe that Barclays Bank intended to 21 make a public statement denying a “paid” relationship between Staley and Epstein without intending 22 the public to believe that it was denying any sort of professional relationship between the two. 23 Therefore, the Court finds that Plaintiffs have made a plausible allegation that this statement was 24 misleading. 25 b. The press releases and annual report are plausibly misleading. 26

27 4 To be clear, it will ultimately be for the trier of fact (or this Court on a motion for summary judgment) to determine whether the statements were made, whether they were misleading, and whether they were material. 28 1 In both a press release dated February 13, 2020, and the 2019 Annual Report, Defendants 2 stated that “Mr. Staley developed a professional relationship with Mr. Epstein.” FAC ¶ 69. The 3 Court finds this statement supports an inference that Staley and Epstein only had a professional 4 relationship, which would be potentially misleading. A reasonable investor who read the Board’s 5 statements would not think that Staley and Epstein had a personal relationship. Barclays Bank 6 contends that publications opined otherwise, so investors should not have been misled (Barclays 7 Bank MTD at 12), but this misses the point. The press release and annual report were a response to 8 the NYT Article, after Defendants had a reasonable opportunity to investigate the issue. Drawing all 9 inferences in favor of Plaintiffs, Defendants’ statements were an attempt to set the record straight 10 about Staley and Epstein’s relationship after doing their own due diligence, and it would be 11 reasonable for an investor to find that these statements from Defendants themselves to be more 12 reliable. See In re Apple Comput. Sec. Litig., 886 F.2d 1109, 1115 (9th Cir. 1989) (“The investing 13 public justifiably places heavy reliance on the statements and opinions of corporate insiders.”). 14 The inference that Staley and Epstein’s relationship was purely professional is reinforced by 15 the context of the statement, in which the Board reiterated that Staley had the “full confidence” of 16 the Board and recommended his re-election at the same time. Id. Although Defendants contend that 17 these are simply opinions that cannot be misleading without allegations the Board actually believed 18 differently, this is exactly what the FAC alleges. In particular, Plaintiffs allege that Barclays Bank 19 learned of the cache of emails revealing the true nature of Staley and Epstein’s relationship in 20 December of 2019. FAC ¶ 65. Barclays Bank is alleged to have hired a law firm to conduct an 21 internal investigation with “appended the most controversial emails between Staley and Epstein.” Id. 22 ¶ 66.5 The Court does not find it proper at this stage to make determinations about whether or not 23 24 25 5 Barclays Bank also contends that Plaintiffs’ allegations fall short of Rule 9(b), but it is unclear what more specificity can be provided about what Barclays Bank should have known than the emails themselves, which 26 the Court finds sufficiently identified. Based on their arguments, Defendants are not actually contesting the specificity of the allegations, but rather disputing the inferences to be drawn from them. See, e.g., Barclays 27 Bank MTD at 13–14 (describing the emails to include “banal expressions of flattery and gratitude” and “references so cryptic and stripped of context that they cannot shed any definitive light on the relationship” 28 1 Defendants reasonably believed differently or not based on the information available to them at that 2 time. Therefore, the Court finds these statements properly and plausibly pleaded as misleading. 3 Defendants also contest a few other statements in the 2020 Press Release and 2019 Annual 4 Report regarding their response to the FCA—namely, that Staley “volunteered” information about 5 Epstein, that Barclays Bank was “cooperating” with the FCA, and that the Board had “rigorously 6 followed” its governance process with regards to the FCA’s investigation. First, Defendants’ 7 arguments about these specific word choices are insufficient at this stage to dispel the otherwise 8 potentially misleading nature of the 2020 Press Release and 2019 Annual Report—which is that 9 Staley and Epstein’s relationship was merely professional (despite the Board having evidence 10 otherwise), and that because of this, the Board maintained full confidence in Staley. Nevertheless, 11 the Court finds the specific words that Defendants defend as technically truthful are still misleading. 12 The connotation of the word “volunteer” in the context of the statements conveys that Staley had 13 nothing to hide, which is misleading given what the evidence ultimately revealed. And, Staley’s 14 concealment of information supports an inference that Defendants were not fully cooperative with 15 the investigation.6 The Board’s “rigorous” compliance with its processes also conveys that it put a 16 certain amount of effort into its investigation, which to a reasonable investor would include a fair 17 consideration of the evidence it actually had access to. As alleged, the Board simply disregarded the 18 evidence that Staley’s relationship with Epstein was not as he had explained it previously to be. 19 Barclays Bank and Higgins also contend that the 2021 Press Release regarding the FCA’s 20 preliminary findings were accurate. Barclays Bank MTD at 17. However, as alleged, the FCA’s 21 investigation was not simply whether Staley was aware of Epstein’s alleged crimes. Plaintiffs allege 22 that the FCA “was seeking assurance that Barclays Bank had discharged its regulatory obligations to 23 24 6 The Court finds Staley’s actions and knowledge as CEO attributable to Barclays Bank. In re ChinaCast Educ. Corp. Sec. Litig., 809 F.3d 471, 476 (9th Cir. 2015) (holding that “a corporation is responsible for a 25 corporate officer’s fraud committed ‘within the scope of his employment’ or ‘for a misleading statement made by an employee or other agent who has actual or apparent authority’”). Plaintiffs’ allegations sufficiently 26 point to statements made by Staley knowing they were misleading while he was at Barclays Bank and made in the course of his employment as CEO. See, e.g., FAC ¶ 71 (alleging that Staley affirmed his professional 27 relationship with Epstein during an earnings call). Regardless of whether Staley’s knowledge came prior to his tenure at Barclays Bank, there is no dispute his knowledge of making misleading statements is temporally 28 1 ensure it understood and had properly managed the risks to which it was exposed,” and therefore the 2 inquiry was “broader than whether Staley had witnessed Epstein’s alleged crimes.” FAC ¶ 91. 3 Drawing all inferences in favor of Plaintiffs, the 2021 Press Release, which implied that the biggest 4 concern of the FCA was simply Staley’s awareness of Epstein’s alleged crimes, is misleading. 5 Accordingly, the Court finds the statements contained in the 2020 and 2021 Press Releases 6 and the 2019 Annual Report plausibly misleading. 7 c. Staley’s conference call statements were plausibly misleading. 8 On February 13, 2020, Staley participated on an earnings conference call with analysts, 9 where he stated that his relationship with Epstein “began to taper off quite significantly” after Staley 10 left JPMorgan, “stopped before [Staley] joined Barclays Bank,” and the two have “obviously” had 11 “no contact . . . whatsoever since then.” FAC ¶ 71. While Defendants contend that the last contacts 12 alleged was actually before Staley become CEO of Barclays Bank, Plaintiffs’ allegations support 13 that Epstein and Staley had contact, even if indirectly, past this point in time. See FAC ¶ 56 (alleging 14 that Epstein emailed Staley earlier in the year “better if you not email me. phone only.”). 15 Accordingly, drawing all inferences in favor of the complaint, the Court finds the statement to be 16 plausibly misleading. 17 ii. The Court finds that Higgins can be liable for misleading statements. 18 Higgins independently argues that he cannot be liable for any misleading statements he did 19 not personally make. “For Rule 10b-5 purposes, the maker of a statement is the person or entity with 20 ultimate authority over the statement, including its content and whether and how to communicate it.” 21 Janus Capital Grp., Inc. v. First Derivative Traders, 564 U.S. 135, 142 (2011). The Court finds that, 22 drawing all inferences in favor of Plaintiffs, Higgins did have ultimate control for the statements 23 made by Barclays Bank. See Howard v. Everex Systems, Inc., 228 F.3d 1057, 1061 at n.5 (explaining 24 that “substantial participation or intricate involvement in the preparation of fraudulent statements is 25 grounds for primary liability”). The Court does not find the allegations purely conclusory in the 26 circumstances because as the Chairman of the Board, it logically follows that statements made by 27 the Board were made or at least approved by Higgins. Cf. Bruce v. Suntech Power Holdings Co. 28 Ltd., 2013 WL 6843610, at *4 (N.D. Cal. Dec. 26, 2013) (attempting to link general statements made 1 by a company simply by virtue of being the company’s Chief Financial Officer too conclusory). 2 Here, the allegations reflect that statements were made by “the Board.” See, e.g., FAC ¶ 69 (“Based 3 on a review . . . of the information available to us and representations made by Mr. Staley, the 4 Board . . . believes that Mr. Staley has been sufficiently transparent . . .”). Therefore, to the extent 5 that any statements are attributable to the Board, the Court finds them attributable to Higgins for 6 purpose of this motion. 7 Higgins also specifically contests that his declination to comment on Staley’s departure from 8 Barclays Bank is not misleading. FAC ¶ 88. The Court finds that this specific comment is not 9 misleading, and thus will partially grant the Motion on this statement only without leave to 10 amend. 11 iii. The Court finds the allegedly misleading statements were material. 12 “For the purposes of a 10b-5 claim, a misrepresentation or omission is material if there is a 13 substantial likelihood that a reasonable investor would have acted differently if the misrepresentation 14 had not been made or the truth had been disclosed.” Livid Holdings Ltd. v. Salomon Smith Barney, 15 Inc., 416 F.3d 940, 946 (9th Cir. 2005). Defendants contend that any misrepresentations or 16 omissions about Staley’s personal conduct as opposed to Barclays Bank’s business cannot be 17 material, and that there was sufficient information in the public domain to allow investors to 18 determine the true nature of Staley and Epstein’s relationship. 19 First, Defendants have cited no binding authority that misrepresentations about matters 20 personal to a CEO are not material. Rather, the inquiry into materiality is “fact-specific” and 21 “requires delicate assessment of the inferences of a reasonable shareholder would draw from a given 22 set of facts and the significance of those inferences to him.” In re Alphabet, Inc. Sec. Lit., 1 F.4th 23 687, 700 (9th Cir. 2021). “These assessments are peculiarly ones for the trier of fact,” and as a result, 24 “resolving materiality as a matter of law is generally appropriate only if [the materiality of the 25 statement] is so obvious that reasonable minds could not differ.” Id. (internal citations omitted). 26 Defendants have not shown that a reasonable investor could not find the relationship of a top 27 executive of Barclays Bank with a convicted sex offender related to their decisions. Frankly, the 28 simple fact that Barclays Bank initiated an investigation and that FCA initiated an investigation 1 shows at the very least that it was plausible that the information was material. Moreover, even if 2 there had been representations in the media that Staley and Epstein had a more than professional 3 relationship, again, it appears that Defendants denied the representations, which investors may 4 reasonably give more weight. And, media coverage does not logically hold the same amount of 5 weight as the results of an investigation done by a regulatory agency. Thus, the Court finds sufficient 6 allegations to meet materiality. 7 iv. The Court finds the FAC sufficiently pleads scienter. 8 To adequately plead scienter, a plaintiff must “state with particularity facts giving rise to a 9 strong inference that the defendant acted with the required state of mind.” 15 U.S.C. § 78u-4(b)(2). 10 “A ‘strong inference’ exists ‘if a reasonable person would deem the inference of scienter cogent and 11 at least as compelling as any opposing inference one could draw from the facts alleged.’” Glazer 12 Cap. Mgmt. L.P. v. Forescout Techs., Inc., 63 F.4th 747, 766 (9th Cir. 2023). The Court finds 13 scienter pleaded with sufficient specificity as to Barclays Bank and Higgins.7 14 A “reckless omission of material fact satisfies the element of scienter, provided that such 15 recklessness reflects some degree of intentional or conscious misconduct.” In re Alphabet, 1 F.4th at 16 701. As discussed above, the Court finds materiality sufficiently met, and the Court finds some 17 degree of intent. In particular, intent to deceive or deliberate recklessness is supported by the 18 allegations that Barclays Bank and Higgins received evidence revealing the true nature of Staley’s 19 relationship with Epstein as early as December 2019, and yet continued to make statements fully in 20 support of Staley, even after his departure from Barclays Bank. The Court does not find that any 21 opposing inference is more compelling at this stage—for example, an opposing inference could be 22 that Barclays Bank and Higgins never looked at the emails in any great detail. However, given the 23 specific investigation conducted by Barclays Bank into the issue, the Court finds it just as 24 compelling that Barclays Bank and Higgins were fully aware of the contents of the emails and what 25 26 27

28 7 1 they signified,8 and simply wanted to protect Barclays Bank’s reputation.9 Assessing all the 2 allegations of the complaint “holistically,” (In re Alphabet, 1 F.4th at 701), the Court finds there is a 3 strong inference that Barclays Bank and Higgins acted with an intent to conceal or misrepresent 4 facts. 5 v. The Court finds the FAC pleads loss causation. 6 “Because loss causation is simply a variant of proximate cause, the ultimate issue is whether 7 the defendant’s misstatement, as opposed to some other fact, foreseeably caused the plaintiff’s loss.” 8 Lloyd v. CVB Financial Corp., 811 F.3d 1200, 1210 (9th Cir. 2016).10 Here, Plaintiffs allege that the 9 FCA Decision Notice, published on October 12, 2023, revealed the truth about Staley’s relationship 10 with Epstein and Barclays Bank’s knowledge thereof. FAC ¶ 103. Barclays Bank also released the 11 2023 Press Release on this day that disclosed a decision by the Board’s Renumeration Committee, 12 which concluded Staley was ineligible for or would forfeit a number of monetary awards. FAC ¶ 13 112. Because of these disclosures, Plaintiffs allege a stock in the drop price at the close of October 14 12. FAC ¶ 113. Staley’s position is that these disclosures do not sufficiently relate to the misleading 15 statements alleged, and Defendants all contend that they did not reveal any new information and 16 therefore could not have caused the stock drop alleged. 17 18 19 20 8 The Court notes that the FAC alleges that Higgins “privately admitted that the emails ‘ma[de] for uncomfortable reading,’” further supporting scienter as to him individually. FAC ¶ 21. 21 9 While the Court finds this a common-sense motive from the allegations, the Court does not find it necessary for motive to be specifically alleged. See Prodanova v. H.C. Wainwright & Co., LLC, 993 F.3d 1097, 1107 22 (9th Cir. 2021) (noting that “a complaint lacking a plausible motive allegation may still meet its burden of pleading a strong inference of scienter”). Here, as the complaint alleges “compelling and particularized facts 23 showing . . . deliberate recklessness,” an allegation of motive is not needed. Id. 24 10 At the hearing, counsel for Barclays Bank and Higgins emphasized that the heightened pleading standards for the PSLRA applied to loss causation. While the Court acknowledges that the heightened requirements 25 apply to the particularity of the allegations, the Court finds no support that a plaintiff must plead something beyond plausibility when it comes to the rationale of the causal link itself. See Katyle v. Penn Nat. Gaming, 26 Inc., 637 F.3d 462, 471 (4th Cir. 2011) (“The degree of specificity demanded is that which will ‘enable the court to evaluate whether the necessary causal link exists.’”), adopted by Oregon Public Employees 27 Retirement Fund v. Apollo Grp Inc., 774 F.3d 598, 605 (9th Cir. 2014); see also In re Gilead Sciences Sec. Lit., 536 F.3d 1049, 1057 (9th Cir. 2008) (“So long as the complaint alleges facts that, if taken as true, 28 1 The Court finds that the detailed, 79-page FCA Decision Notice and 2023 Press Release 2 could plausibly have caused the alleged loss.11 While Staley argues that the statements the FCA 3 actually found misleading were never publicly made, the Court finds otherwise. As discussed above, 4 the Court finds that Plaintiffs’ allegations sufficiently support that Defendants did make plausibly 5 misleading and public statements about the nature of Staley and Epstein’s relationship, including 6 implying that their relationship was only professional in the face of an FCA investigation. See, e.g., 7 FAC ¶¶ 69, 71. Moreover, Staley’s prior departure from Barclays Bank after the FCA’s preliminary 8 findings does not preclude its ultimate findings having an impact on the market. While the 2021 9 Press Release communicated that Staley was departing Barclays Bank following the FCA’s 10 preliminary conclusions, there are no allegations about the specific findings being made, and 11 Barclays Bank continued to support Staley. FAC ¶ 83. In fact, the 2021 Press Release stated that 12 Staley intended to “contest” the FCA’s conclusions, and the context of the statement could be 13 interpreted that he was leaving to do so. ECF No. 59-3, Ex. 3. Significantly, it also stated that the 14 Board was “disappointed” in the outcome, which could reasonably be interpreted as being 15 disappointed by the FCA’s preliminary findings because Barclays Bank disagreed with them, and 16 supported Staley’s decision to contest the findings. Id. The 2021 Press Release otherwise praised 17 Staley’s performance. Id. While the 2021 Press Release arguably characterizes the FCA’s 18 preliminary findings as “problematic” for Staley such that he needed to step down, it is a far cry 19 from being as “problematic” as the 2023 Press Release was in terms of signaling actual wrongdoing 20 by Defendants. See Reply at 2. 21 While Defendants note that there were other articles and publicly available information that 22 revealed the details of Staley and Epstein’s relationship before the 2023 Press Release, the Court 23 finds that the ultimate conclusion of the FCA investigation still provides a plausible basis to support 24 loss causation. The FCA’s final determination provided confirmation of Staley’s misrepresentations 25 that the 2021 Press Release did not, and also provided details about Defendants’ specific misleading 26

27 11 While Defendants have judicially noticed a few news articles that they argue gave investors “extensive details” of the relationship, the Court does not find that Defendants have shown the news article covered the 28 1 statements to the FCA. While the misleading statements in the 2019 Letter cannot be a basis for 2 liability as they were never made publicly, Plaintiffs have pointed to multiple public statements by 3 Barclays Bank that it was “cooperating” with the FCA in the investigation. FAC ¶¶ 70, 79, 89, 94. 4 The FCA Decision Notice provides new information supporting an inference that Barclays Bank had 5 not cooperated by sending a misleading letter. See ECF No. 59-7 (“FCA Decision Notice”) at 2.16 6 (finding that “Barclays made statements which gave the misleading impression” that there was no 7 close relationship”). To the extent that the FCA does not directly attribute blame on Barclays Bank 8 to the 2019 Letter being misleading, the Court notes that the FCA Decision Notice still calls into 9 question whether Barclays Bank sufficiently conducted its own due diligence into the issue in its 10 claims to have been “cooperating.” Id. at 2.12 (noting that the FCA was “entitled to rely on the 11 contents of the Letter as being an accurate characterization by Barclays of the nature of the 12 relationship” and the FCA “relied on the assurance provided by Barclays”). 13 Defendants also have not shown that the stock price drop on October 12 was necessarily 14 caused by something else, even just a typical market movement—rather, as Staley represents, 15 Barclays Bank’s stock drops in this time period only dropped about 2.25% per day, which is less 16 than the stock drop alleged. Staley MTD at 17. Defendants cite no binding authority that a drop of 3– 17 5% would not be sufficient to satisfy loss causation as a matter of law. See In re Gilead Sciences 18 Sec. Lit., 536 F.3d 1049, 1057 (9th Cir. 2008) (noting that “so long as the plaintiff alleges facts to 19 support a theory that is not facially implausible, the court’s skepticism is best reserved for later 20 stages of the proceedings when the plaintiff’s case can be rejected on evidentiary grounds”). 21 Accordingly, the Court finds loss causation sufficiently alleged. 22 B. The Court Finds Count 2 Sufficiently Pleaded 23 To state a claim for control-person liability under Section 20(a), a plaintiff must allege a 24 primary violation under Section 10(b). As the Court has found a primary violation sufficiently 25 pleaded under Count 1, the Court denies Defendants’ Motions as to Count 2.12 26

27 12 Staley independently argues that he cannot be considered a control person after his departure from Barclays Bank, but the Court finds this argument moot as Plaintiffs state they do not “assert a claim for Staley’s 28 1 C. The Court Has Subject Matter Jurisdiction Over Count 3 2 Barclays Bank moves to dismiss Count 3 for violations of Section 90A of the UK’s FSMA 3 arguing that this Court should decline to exercise supplemental jurisdiction over this claim 4 specifically. However, this Court has original jurisdiction of Count 3 under the diversity statute, 28 5 U.S.C. §1332. As alleged, “[w]ith respect to the FMSA claim, this Court has diversity jurisdiction 6 pursuant to 28 U.S.C. § 1332(d)(2).” FAC ¶ 33. Barclays Bank does not dispute that the 7 requirements of diversity jurisdiction have been met. As the Court has original jurisdiction of Count 8 3, the Court does not have discretion to decline jurisdiction of this claim. See Sorosky v. Burroughs 9 Corp., 826 F.2d 794, 805 (9th Cir. 1987) (“Although a district court does have discretion whether to 10 exercise jurisdiction over state claims pendent to claims raising a question arising under federal law, 11 a district court does not have discretion to refuse jurisdiction over state claims in a diversity case.”) 12 (citations omitted).13 13 Barclays Bank alternatively argues that this Court should decline to exercise jurisdiction over 14 Count 3 under the doctrine of forum non conveniens. “The doctrine of forum non conveniens is a 15 drastic exercise of the court’s ‘inherent power’ because, unlike a mere transfer of venue, it results in 16 the dismissal of a plaintiff’s case.” Carijano v. Occidental Petroleum Corp., 643 F.3d 1216, 1224. 17 Because of this harsh result for plaintiffs, it is “an exceptional tool to be employed sparingly.” 18 Gutierrez v. Advanced Med. Optics, Inc., 640 F.3d 1025, 1029 (9th Cir. 2011). At its core, the 19 doctrine is concerned with fairness to the parties.” Id. at 1030. To prevail, the defendant bears the 20 burden of showing “(1) that there is an adequate alternative forum, and (2) that the balance of private 21 and public interest factors favors dismissal.” Dole Food Co., Inc. v. Watts, 303 F.3d 1104, 1118 (9th 22 Cir. 2002). “The plaintiff’s choice of forum will not be disturbed unless the ‘private interest’ and 23 ‘public interest’ factors strongly favor trial in the foreign country.” Id. 24 25

26 13 Regardless, the Court does not find the factors in 28 U.S.C. § 1367(c) satisfied in order to decline supplemental jurisdiction even if it were appropriate to do so. In particular, the claim does not “raise a novel 27 or complex issue of state law” (§ 1367(c)(1) (emphasis added)); the claim does not substantially predominate (§ 1367(c)(2)); the other claims have not been dismissed (§ 1367(c)(3)); and Barclays Bank has not shown 28 1 The central focus of the first part of the inquiry—whether an adequate alternative forum 2 exists—asks if “the entire case and all the parties can come within the jurisdiction of that forum. 3 Gutierrez, 640 F.3d at 1029 (emphasis added). “The foreign forum must provide the plaintiff with 4 some remedy for his wrong in order for the alternative forum to be adequate.” Lueck v. Sundstrand 5 Corp., 236 F.3d 1137, 1143 (9th Cir. 2001). Dismissal is not justified simply where a case involves 6 conduct or parties from oversees. Carijano, 643 F.3d at 1224. “The burden of showing the existence 7 of an adequate alternative forum is the defendant’s.” Cheng v. Boeing Co., 708 F.2d 1406, 1411 (9th 8 Cir. 1983). Barclays Bank argues that “UK courts provide a more adequate forum to adjudicate 9 plaintiff’s claims against a UK company under UK securities laws.” Barclays Bank MTD 23. 10 However, the adequate forum inquiry concerns “the entire case and all the parties.” Because this 11 case also involves two claims under U.S. law, both including Barclays Bank as a defendant, a UK 12 court would not necessarily be a better forum for the entire case and all Plaintiffs. Nonetheless, the 13 UK is likely an adequate forum, as a remedy is provided under UK law. 14 Assuming the UK would be an adequate forum, the Court continues to the next step of the 15 forum non conveniens analysis—consideration of the public and private interest factors. Courts 16 consider the following private interest factors in determining whether to grant dismissal under forum 17 non conveniens: 18 (1) the residence of the parties and the witnesses; (2) the forum’s convenience to the litigants; 19 (3) the access to physical evidence and other sources of proof; (4) whether unwilling witnesses can be compelled to testify; 20 (5) the cost of bringing those witnesses to trial; 21 (6) the enforceability of the judgement; and (7) all other practical problems that make trial of a case easy, expeditious and inexpensive. 22 Id. With regards to the private factors, Barclays Bank only raises arguments that touch on the first, 23 second, third, and fourth factors. Thus, the Court finds it conceded that the remaining factors weigh 24 against dismissal. 25 The first two factors also weigh against dismissal. While Barclays Bank is headquartered in 26 London, Barclays Bank does not dispute that it “operates internationally.” FAC ¶ 5. Moreover, it 27 would appear that at least some of the relevant class of plaintiffs (if not the majority of them) reside 28 1 in the United States.14 Even if the Court were to sever Count 3 from the other counts, it would be 2 even less convenient for the parties to have to litigate the two lawsuits concurrently and Barclays 3 Bank would still have to defend the case here. 4 The third and fourth factors also weigh against dismissal. Although Barclays Bank 5 summarily states that “most of the evidence and witnesses relating to its board’s conduct . . . would 6 be located [in London],” Barclays Bank does not provide any specific details. Barclays Bank Motion 7 at 23. Rather, the evidence in this case is likely to be largely digital—the contested statements were 8 made by Defendants themselves and are contained in materials easily available and transmitted 9 online. Cf. Lueck, 236 F.3d at 1146 (finding the private interest factors favored dismissal where 10 evidence in New Zealand included aircraft wreckage, flight crew, crash investigators, Plaintiffs, 11 Plaintiffs’ doctors and employers, airline and aircraft records, investigation records, and records 12 regarding the qualifications of the flight crew). Barclays Bank also does not specify which witnesses 13 or otherwise show that an overwhelming majority of them would be unwilling or unable to testify. In 14 any event, the witnesses would still be called upon with regards to the other two counts. 15 Courts also examine the following five public interest factors in determining whether to 16 dismiss under forum non conveniens: 17 (1) local interest of lawsuit; (2) the court’s familiarity with governing law; 18 (3) burden on local courts and juries; (4) congestion in the court; and 19 (5) the costs of resolving a dispute unrelated to this forum. 20 Id. at 1147. 21 Here, Barclays Bank simply argues that “UK courts have a greater interest in adjudicating” 22 the claim. Be that as it may, the Court finds that this does not outweigh its determination on the 23 private factors, which all weigh in favor of retaining jurisdiction of Count 3. Barclays Bank has not 24 met its burden in showing that the Court should employ the exceptional application of form non 25 conveniens to dismiss Count 3 in its entirety. See Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 26 1163, 1180 (9th Cir. 2006) (explaining that “a plaintiff need not select the optimal forum for his 27

28 14 1 claim, but only a forum that is not so oppressive and vexatious to the defendant ‘as to be out of 2 proportion to the plaintiff’s convenience’”). 3 D. The Court Finds Count 3 Insufficiently Pleaded 4 Although the Court finds that it should retain jurisdiction over Count 3, the Court finds that it 5 is insufficiently alleged. Barclays Bank contends there are insufficient allegations of a misleading 6 statement that resulted in the loss alleged. Barclays Bank Motion at 24. In opposition, the Firemen 7 appear to concede that their Section 90A claim is not applicable with regards to false and misleading 8 statements, but contend that their 90A claim is sufficient under a theory of dishonest delay. Barclays 9 Bank Opp. at 20, n.11. However, the Court finds that the allegations are insufficient to plead a 10 Section 90A claim for dishonest delay at this time. 11 Under the FMSA, an issuer of securities is liable to individuals who “suffers loss in respect of 12 the securities [acquired or held] as a result of delay by the issuer in publishing information,” where 13 the issuer “acted dishonestly in delaying the publication of the information.” ECF No. 69-1 (“Moore 14 Decl.”) ¶ 74. The parties do not dispute that reliance is not required under a dishonest delay theory. 15 ECF No. 73-1 (“Kramer Reply Decl.”) ¶ 41. The Firemen contend that by the disclosure of the FCA 16 investigation on February 13, 2020, Barclays Bank knew that its response to the FCA was 17 inaccurate, yet delayed in disclosing what they understood the true nature of Staley’s relationship 18 with Epstein to be. Barclays Bank Opp. at 24. Nevertheless, the parties also do not dispute that the 19 information that was delayed in being disclosed must have been ultimately published. As to this 20 point, the Firemen point to the press release issued in October of 2023 based on the FCA Decision. 21 The Court notes that the 2023 Press Release is based specifically on the FCA Decision, and thus 22 could not have been disclosed earlier. FAC ¶¶ 111–12. Although the Court understands Plaintiffs’ 23 position to be that Defendants knew what the FCA ultimately concluded earlier, as the 2023 Press 24 Release is specifically based on the FCA’s final determination and not on what Defendants 25 independently may have known, the Court finds that it cannot support a theory of dishonest delay. 26 The Court therefore finds Count 3 insufficiently pleaded, although the Court finds that it may 27 be possible for the Firemen to cure the deficiency through amendment. Accordingly, the Court will 28 GRANT the Motion as to Count 3 WITH LEAVE TO AMEND. 1 III. Conclusion 2 For the foregoing reasons, the Court hereby ORDERS as follows: 3 1. The Staley Motion to Dismiss (ECF No. 56) is DENIED; 4 2. The Barclays Bank Motion to Dismiss (ECF No. 58) is GRANTED IN PART; 5 a. The Court DISMISSES Counts 1 and 2 against Higgins to the extent that they are 6 based on Higgins’ declination to comment on Staley’s departure ONLY. 7 b. The Court DISMISSES Count 3 for violations of Section 90A of the FMSA with 8 leave to amend. 9 c. Any amended complaint must be filed within thirty (30) days of the date of this 10 Order. 11 d. Should Plaintiffs fail to timely file an amended complaint, the operative complaint 12 will be the existing FAC with Count 3 stricken (as well as the portions of Counts 1 13 and 2 that rely on the declination to comment), and the thirtieth (30th) day from the 14 date of this Order will be deemed the date of filing for purposes of calculating when 15 Defendants’ Answer is due. 16 17 IT IS SO ORDERED. 18 SS 19 Dated: July 10, 2025 20 MAAME EWUSI-MENSAH FRIMPONG 21 United States District Judge 22 23 24 25 26 27 28