*1 no further amend- fits. As the district court is the best to make planned that it bridging provision. Again, position to determine the actual date the ments to the theory have began running under this would statute of limitations brought suit the defendant brought by because each claim each individual premature been by its statement and could plaintiff, application not bound we leave the of our again bridging provision court, holding along have amended to the district with Third, one plaintiffs retired. any before proceedings further consistent with pension check is a argue could that each opinion. this a new statute of limita- new violation with
tions, holding to the Bazemore. similar above, however, find we
As discussed checks are inapposite pension
Bazemore require a dif- paychecks
distinct from Thus, statute of limi- analysis.
ferent to run anew with begin
tations did not option, The fourth pension each check. Jay SYVERSON, Appellant, Plaintiff — applicable find most to this and the one we v. case, limitations is that the statute of be- FIREPOND, INC., Corpora a Delaware plaintiff each individual gan running when tion; Inc., Stephens, Robertson a Mas pension her benefits vested. retired and Corporation, sachusetts Defendants— It is at this moment that the dis- Appellees. pension plan criminatory provision applied plaintiff to each and the defen- George Appellant, Plaintiff — longer bridging could no amend the dant See, provision to cure such discrimination. Bd., e.g., v. Rhode Island Ret. McGrath Inc., Corporation; a Delaware (1st Cir.1996) (noting that the F.3d Inc., Stephens, Massachu plan only applies
right pension amend Corporation, —Appel setts Defendant s employees rights up until the time lees. vest). plan under the 03-2410, 03-2415. No. CONCLUSION Appeals States Court of United hold that the district court misread , Eighth Circuit. complaints and dismissed plaintiffs’ prematurely. alleg- this Rather than March 2004. case Submitted: ing that the defendant discriminated Sept. Filed: against them in the 1960s when were Rehearing En Banc Rehearing and terminated, originally we find Denied Oct. bridg- that the plaintiffs’ complaints ing provisions pension in the defendant’s discriminatory in a
plan adopted in a resulting present
manner violation
Title further hold that the statute VII. We period began alleg-
of limitations when the
edly discriminatory pension plan ap- is, that when each of
plied plaintiffs; eligible
them retired and became for bene- *2 White, Mankato, argued,
Kenneth R. (Kevin Mankato, MN, MN O’C. Green brief), for appellant. on the Noteboom, argued, Todd A. Minne- (Monica Davies, apolis, L. on the MN brief), appellee for Kerry Bundy, argued, Minneapolis, L. (Karen Knych, MN E. and Lianne Wilson brief), appellee on the Robertson Ste- phens, Inc. MURPHY, SMITH,
Before COLLOTON, Judges. Circuit SMITH, Judge. Circuit George Jay Syverson Flora and filed fraud, actions-seeking damages civil (“IPO”)-the ing and breach of misrepresentation, underwriter all (“Fire- Inc. contract-against existing shareholders and holders to Pond”) Stephens, Inc. “lock-up”4 agreement. execute a Robert- (“Robertson”). Syverson ap- primary son was underwriter for the *3 dismissing order 11, 1999, the district court’s2 peal IPO. On November Flora execut- to Federal Rule of pursuant their claims lock-up agreement ed a him prevented 12(c). affirm. Procedure Civil exercising from his options period for a 4, 2000, days February after the date Background I. of the IPO. Based on represen- FirePond’s tations, and all Flora other stockholders A. Flora faced the same conditions. stage of the procedural Based on the share, dismissal, skyrocketing per After to the facts presume $100 we the value of FirePond stock fluctuated dra- to be true. Flora complaint matically. By lock-up peri- the end of the orally agreed supply personnel-place- to exchange price to FirePond3 in od the ment services FirePond stock had fallen per on FirePond securities. to options for stock share-and the stock’s value $17.75 options on agreed accept Flora stock to fall. Flora continued did not exercise 150,000 of FirePond stock in return options shares at end of lock-up peri- year placement Instead, his first services. he until than od. waited more options Flora’s agreement, Per the were year after the lock-up agreement one immediately and no limitations were vest By expired. this time the stock’s value options. right on his to exercise placed than per was less share. Flora later $1 learned, contrary representation sixty performing approximately After FirePond, that not all shareholders and May percent placements, of the option lock-up agree- holders had executed sign Flora to a document FirePond asked He also ments. learned some share- agreement. memorializing stock-option options stock or holders sold exercised Although disagreed he with some of its ini- prices more favorable than the stock’s terms, signed the document. In Oc- Flora post lock-up per tial value of share. $17.75 signed tober of Flora a second stock- that contained es- option agreement form Syverson B.
sentially agree- the same terms as the first point options ment. At this Flora held by FirePond Syverson employed 150,000 per shares-with a value of $2.63 predecessor Computers and its Clear With share-of FirePond stock. (“CWC”). Syverson received CWC and exchange for his em- FirePond stock
In November FirePond officials ployment services before the IPO. Like Flora that FirePond was to be- informed Syverson was informed that-as publically-traded company. come a shareholders were re- part also informed that-as a condition of IPO-all lock-up agreements. public quired the initial offer- execute going forward with computer company. appealed 3. is a software each the dis- FirePond respective ac- trict court's dismissal of their tions, appeals consolidated for and their were Lock-up agreements help stabilize stock val- our review. following public during period ue the initial offering by prior keeping issued shares and Doty, S. United States 2. The Honorable David options off the market. Judge Minnesota. District for the District of subjected lock-up periods. shorter objected to the terms When Misvaer, substantially the same claims brought Christian He lock-up agreement, as did told him that attorney at a staff mandatory and that Flora. also essence.” Misvaer was of the “time Summary C. Procedural executed stated that without every shareholder from agreements in federal court. His Flora filed suit holder, go for- might the IPO complaint alleged negligent misrepresenta- that if also told Misvaer ward. fraud, of con- tion, common-law he lock-up agreement did not he tract, Securities violation of the Minnesota *4 difficulty exchanging his CWC might have Act, Act the Consumer Fraud Minnesota for FirePond shares. shares 10(b) Ex- §§ and 17 of the Securities and the against Act change With a letter Syverson received Additionally, contract, Flora al- of exception counsel, general Thomas from FirePond’s leged the same claims Robertson. Carretta, announcing plan FirePond’s He also claimed that Robertson violat- Included the letter was go public. with Exchange § Act ed 20 of the Securities agreement and a re- lock-up copy his contract tortiously and interfered with The letter reit- envelope and airbill. turn Essentially, Syverson’s with FirePond. requirement that all erated Roberts.on’s against FirePond and Robertson complaint agree- lock-up execute the shareholders Flora’s. go forward. mirrored ment before the IPO would that he conditioned Syverson claims judgment on FirePond filed a motion agreement on execution of the Misvaer’s January pleadings the on Robert- in- Syverson would assurance that join in motion. On son did not March lock-up agreements not formed if the 27, 2002, brought mo- 15 and March or if every shareholder The complaint. to amend the district tions Syverson contends could be modified. granted part, motion in court FirePond’s agreed to that condition. that Misvaer con- dismissing claims of breach of Flora’s tract, 10(b), § Flora, violation of and violation the value Like watched § The court denied FirePond’s motion then fall dramatical- of his shares rise and claims, pending to Flora’s other amend- during day lock-up period. Like ly the 180 briefing Flora’s, complaint ment of the and further Syverson’s shares had the value parties. granted The court Flora’s share the end of dropped per $17.75 motion to amend and denied the sec- first lock-up period and-because motion to the close of the ond amend. did not sell at period-his drop shares continued val- 12(c) Rule motion FirePond renewed its Also, like per ue to less than share. $2.00 pleadings as to the judgment on that-despite Syverson learned Mis- brought of Flora’s claims and remainder and vaer’s Carretta’s assurances Syverson’s the same motion as to claims. contrary-not all shareholders and for dismissal of all Robertson moved lock-up agreements had executed holders 12(b)(6). claims, pursuant to Fed.R.Civ.P. prior to the IPO. (1) there The district court ruled that: (2) there negligent misrepresentation; asserts that some inves- no Syverson now (3) fraud; the Minne- to sell their FirePond was no common law tors were allowed (4) IPO, immediately inapplicable; Act interests after the when sota Securities Fraud Act highest, others the Minnesota Consumer price was its while (5) ed, violated; duty limita- no alleged, the statute of of care was and that neither Flora nor prove fraud claim un- could tions barred the securities 10(b). If reasonable reliance. the district court granted judgment § der The court correctly duty found either absence of under Rule for FirePond and Robertson absence of reliance its dismissal will be 12(c). timely appeal This followed.
affirmed. II. Discussion court, As noted the district a motion for on order to prevail “We review on a claim of accept misrepresentation, plaintiff novo. as true must pleadings de show that the defendant him a legal duty owed pleaded by non-moving party all facts duty. and breached that M.H. v. Caritas all reasonable inferences from grant Svcs., (Minn. Family 488 N.W.2d non-moving in favor of the pleadings 1992). of negligent represen case Any & All Radio party.” United States v. tation, only of care arises when a Equip., Station Transmission person supplies guid information “for the (8th Cir.2000). Judgment of a ance others the course transac appropriate is where no material pleadings *5 interest, tion in which has a pecuniary [he] of fact résolved and issue remains ” or in the of one’s business .... course as a the movant is entitled Bosworth, Inc., Ins. Co. v. Dain 531 University Safeco matter of law. Faibisch v. of 867, (Minn.Ct.App.1995). N.W.2d 871 (8th Minnesota, 797, 304 F.3d 803 Cir. Further, plaintiff a must also demonstrate 2002). also review de novo the district reasonably that he or she relied on the v. application court’s of state law. Lefler Dakota Bank purported misinformation. (8th Co., Gen. Cas. 945 Cir. Eiesland, v. 645 N.W.2d 180-181 2001). (citing § 552 of (Minn.Ct.App.2002) Torts). Restatement of Second Negligent Misrepresentation A.
and Fraud heavily upon relies Cari- argue tas to that FirePond and Robertson First, Syverson argue and Flora duty a to inform him that possessed legal that court erred in its dismissal the district not all shareholders had to the lock negligent misrepresentation their up agreement and that the IPO would claims. The court found that the claims proceed sig even without all shareholder failed as a matter of law. In order to However, assuming arguendo natures. negligent misrepre a claim for establish properly alleged that and Flora a sentation, they legal duty, their claims nonetheless fail (and (1) ultimately prove): a of rea they they cannot show that rea because care owed the defendant sonable sonably relied on the misinformation (2) information; conveying a breach of each claims to have received. duty by negligently supplying false infor (3) mation; on the al reasonable reliance stock-option Flora’s modified contract leged misrepresentations, which reliance is governed by with FirePond was written plaintiffs injury; proximate length cause agreement negotiated at arm’s be- . (4) American damages. Masepohl persons. sophisticated tween business Co., F.Supp. Tobacco argues signed Flora that he subse- (D.Minn.1997). But, the quent agreement The district court found under duress. not alleged by do negligent misrepresentation facts even as duty of care reflect the relevant communications claims failed because no exist- options. of his Flora was aware Syverson’s Flora’s free will. cise overwhelmed restrictions-initially objecting to these lock-up agreement was sign the choice to concerns, In to Flora’s response them. or the result of product of coercion not the Flora the cash pay FirePond offered to upon the adhesion. Based a contract of willing if he value of his services case, reliance in this such undisputed facts Option of the accept the terms “Stock not reasonable. Neither Agreements.” He declined substitute investment advice. nor Robertson sold thereby signed agreements, offer and case, lay expertise elsewhere. each their consenting to the restrictions. a business reflect The facts decision, imprudent, hindsight shows Below, argued Flora these normal bar- into after that was entered May agreements, signed which he gaining. and November constituted February oral contract because signed each contained restrictions when Flora that contained an ex- lock-up agreement following “could sell the stock exercise allowing the underwriter to press provision that, options.” The district court found any provision Lock-Up of this “waive although agreements the written any third par- notice to without signed contained different restrictions Thus, ty.” persuaded even if we were orally allegedly from those communicated special relation- Robertson-because of his “alleged oral contract Syverson-owed duty ship with Flora and ... superseded replaced care, these the claim still fails. Under agreements willingly stock option written Syverson nor Flora circumstances neither *6 signed by Flora.” reasonably relied on statements could have agreement Flora’s oral and the written contrary to made Robertson that were Agreements” covered the Option “Stock provisions the of the written express subject clearly in- same matter but with agreement, and Flora each Co., agree- consistent terms. The later written signed. Campbell Soup Crowell v. Thus, law, a (8th Cir.2001). ment controls. as matter Therefore, F.3d May we find that the and November writ- that the district court we are satisfied agreements superseded ten the oral con- the claims of properly dismissed Therefore, prop- tract. the court district they fail as a misrepresentation because erly dismissed Flora’s breach of contract and Flora’s fraud matter of law. claim. claims, require which also the same ele- reliance,
ment of reasonable suffer the note, however, appeal that on same fate. argues purported Flora that the oral con breached, acquies tract his B. Breach Contract stock-option agree cence to the written Finally, argues ments, Flora alone that Fi acquiescence but to the lock rePond breached the oral contract-to ac up agreement. Flora claims that Fire- in quire options unrestricted stock ex Pond a unrestricted to “deliver at change providing placement options services- stock that would be exercisable theory, into in public offering.” he entered with FirePond Feb the initial This however, ruary argued Flora later entered into two nor was neither And, Agreements” general Option written “Stock the district court. as rule, arguments contained numerous restrictions as to do not we consider appeal when Flora could sell the stock exer- theories on that were not advanced underwriter, may Jolly phens, any v. Knud as “waive proceedings in the below. (8th Cir.2000). sen, provision Lock-Up agreement of this with- Flora’s Accordingly, any party.” we will not consider out third These two notice of contract claim-whether are not revised breach statements antithetical. That ev- lock-up agree acquiescence Flora’s ery sign shareholder must the a breach of FirePond’s ment constituted agreement is not inconsistent with the abil- promise to deliver unrestricted purported ity of the to waive a provision underwriter options. stock the shareholder has after signed agreement. reasons, foregoing For the district respects. affirmed in all court’s dismissal is differently, knowledge Stated may prohibition underwriter waive the COLLOTON, Judge, concurring Circuit selling any shares for shareholder who has concurring judgment in in the in part, signed the lock-up agreement is not the dissenting part. part, and knowledge every same that not share- agree disposition I with the court’s sign holder lock-up agreement must ' claim, I Flora’s of contract place. signs the first Once shareholder judgment affirming concur in the dismissal agreement, mercy he is against of the fraud claims both defen- underwriter; ap- the shareholder has no negligent misrepresentation dants and the parent bargaining power might cause conclude, I against claim how- prohibition. underwriter waive the ever, Syverson adequately that Flora and But if may he knows the underwriter pleaded negligent misrepresen- a claim of proceed public offering with the even Stephens tation under though a handful of shareholders has re- law, Minnesota and I would reverse lock-up agreement, fused to then dismissing of the district court may engage the shareholder be able to that claim. strategic behavior that allows him to re- lock-up agreement main free of the with- Sy-
The court concludes derailing public offering. out plead a claim adequately verson failed to *7 Syverson allege they lost this and negligent misrepresentation, for fraud or opportunity misrepresentations, and due they reasonably could not have because provision lock-up agree- the waiver alleged misrepresentations relied ' ment does not show that reliance on the Ante, upon which the claims are based. alleged misrepresentations was unreason- express 750. The court reasons that a matter of law. able as lock-up agreement signed of the language Syverson contrary Flora and is to the Nonetheless, judgment I concur any alleged misrepresentations, and that court’s of affirming the district dismissal alleged misrepresentations reliance on the against both FirePond and fraud claims respectful- I was therefore unreasonable. I Stephens, agree because with Robertson ly disagree analysis. with this Syverson the district court that Flora and a claim for fraud with Syverson alleged
Flora and that Fire- have not stated to survive a motion represented particularity Pond to them that all share- sufficient holders, pleadings. Fed. including holding op- those stock on the See 9(b). tions, agreement allegation is no sign lock-up must R.Civ.P. There any Stephens repre made false public offering before the initial of stock Robertson Syverson. Flora and lock-up agreement, directly The sentation proceed. would alie- contrast, appellants’ general It is states that Robertson Ste- doubtful that 752 duty Stephens legal making representa- made of care
gations Robertson “by through only “engaged and its tions if it is in the misrepresentations business employees,” profession guidance and that Robert of to oth- agents supplying and infor Stephens son and FirePond shared ers.” Ins. Co. Am. v. Dain Safeco pub Bosworth, Inc., 867, mation each other to further the with 531 871-73 N.W.2d offering, lic are to establish the ordinary sufficient In (Minn.Ct.App.1995). an agency relationship existence of an be arm’s-length relationship parties between Stephens and contract, tween Robertson to a there is no of care that Stephens could be such Robertson might give rise to a claim for fraud FirePond. held liable for misrepresentation. Id. at 873. Flora and Corp., Abels v. Farmers Commodities See Syverson allege do not that FirePond was (8th Cir.2001); La 259 F.3d 916-17 supplying guidance in the business of Servs., Inc., chmund v. Investor ADM complaints par- others. The show that the Cir.1999). (7th Indeed, F.3d ordinary ties had an commercial relation- plaintiffs compliant in their al elsewhere in- ship, and that FirePond communicated lege Stephens that Robertson was the formation to Flora and in the agent purposes negotiating lock-up agree- course of public offering.5 circumstances, ments. Under those allegations support are not sufficient to event, any complaints not also do negligent misrepresentation claim allegations contain sufficient fraud against FirePond. While assert a misrepresentation by FirePond that all respect negligent misrepre- With sign lock-up agree shareholders must allegations sentation against Robertson ment, allege do not however, Stephens, I that Flora believe particularity
with how FirePond knew that pleaded have at least a suffi- representations its false made. when law, cient claim I under Minnesota Merely alleging employed that FirePond judgment dismissing would reverse the experienced counsel who “knew or should complaints. these counts of the it is While than all have known” fewer sharehold true Stephens that Robertson is not in the ers would giving or selling directly business advice sufficiently particular is to to individual investors such as Flora and 9(b). state a claim under Rule See Parnes Syverson, the complaints do 2000, Inc., Gateway 549- Stephens was in the business (8th Cent., Cir.1997); Brown v. N. underwriting public offerings for clients F.S., Inc., F.Supp. 1155-1156 such as FirePond. recog- Minnesota law *8 (N.D.Iowa 1997). nizes that an in “generally underwriter is the business of judgment affirming supplying I also concur in the information for guidance the the negli- Safeco, district court’s dismissal of the its clients.” 531 gent misrepresentation against complaints claim Fire- N.W.2d at 872. The also law, party Pond. Under Minnesota that Stephens representa- owes made plead Stephens misrepresentations "by did not a claim of son made theory represen through agents employees.” fraud based a of "indirect and its and The theory tations.” See Kronebusch v. MVBAHarvestore district court made no mention of a 490, System, (Minn.Ct.App. representations, appel 488 N.W.2d 496 fraud indirect and 1992); Flaby, argues appeal only agency Viksev. 316 283- N.W.2d lants' brief on an noted, (Minn.1982). complaint theory 84 As the al without reference to Vikse or Krone is, leged agency theory, an that Robert- busch.
753
tended,
knowledge
tions to FirePond with the
probable,
or even the
recipient of
(h).
repre-
Id.,
FirePond would communicate those
Rather,
the information.”
cmt.
it
option-hold-
sentations to shareholders and
enough
is
that the maker of the represen-
approached
ers whom FirePond
about the
tation
recipient
knows
the
“intends to
lock-up agreement.
transmit
the information” to “a particular
person
him,
or persons, known to
or a
and
contend that
group
persons,
or class of
distinct from the
reliance,
through a chain of
Robertson Ste
larger
much
might
class who
reasonably
phens
be
making
could
liable to them for
expected
be
sooner or later to have access
negligent
misrepresentations to
to the information and foreseeably to take
which in turn communicated them to Flora
some action in
reliance
it.” Id.
Syverson.
and
theory
This
has
in
support
Minnesota law. In
Graff,
Bonhiver v.
311
The
approach
Restatement
ap-
has been
(1976),
Minn.
The Minnesota in Supreme Court Bon- through company hiver did not say venture to where “the investing, the Massachusetts court held eventually line will be drawn” between the action was jury viable where a those who can recover from a party who could infer accounting that the firm knew negligent misrepresentations makes rely and the opinions investors would on its those who cannot. Id. The court filings. subse- Similarly, Id. at 1077. however, quently recognized, McKissack, that Bonhiv- v. So.2d Hosford (Second) er adopted (Miss.1991), the Restatement Mississippi Supreme Torts definition of negligent misrepresen- applied Court the Restatement view to tation, Olson, Florenzano purchasers N.W.2d hold that home bring could (Minn.1986), 174 n. 3 and the Restate- misrepresentation claim against provides ment guidance drawing pest company, though control even appropriate line. The Restatement de- plaintiffs received allegedly negligent “persons fines the guidance inspection whose report from the seller of the is, supplied,” home, information is per- pest company because the control *9 sons to negligent whom a may defendant should have foreseen that the homeowner’s 552(2) § be liable. Restatement purchaser & cmt. immediate would receive and (h) (1977). According Restatement, also, rely report. e.g., on the See Marcus “it necessary Waterhouse, LLP, is not that the maker the Bros. [of Textiles v. Price negligent misrepresentation] should have 350 N.C. 513 S.E.2d 326-27 (1999). any particular person mind as the in- Rob- alleged that mis- Stephens made
ertson FirePond, knowing that
representation repre- transmit intended
FirePond calls Restatement to what the
sentation persons,” class of “group
particular option-hold- the shareholders
namely, wished
ers whom Minnesota Under agreement. the Restatement
law, adopted has tort, I conclude to this
approach a mo- to survive are sufficient
allegations pleadings. judgment on
tion for reasons, I di- would foregoing
For the negli- claims of
rect reinstatement misrepresentation
gent affirming court join the
Stephens, but other claims. as to all INDUSTRIES, INC.; Terra
TERRA Inc., Appellees,
International, FIRE INSUR-
NATIONAL UNION OF PITTS-
ANCE COMPANY
BURGH, PA, Appellant.
No. 03-3374. Appeals, States Court
United
Eighth Circuit. April
Submitted: 10, 2004. Sept.
Filed: 8,Oct.
Rehearing Denied 27, 2004.
and Oct.