Source: cases/15usc78j/f-supp-3d-354-384-fries-v-northern-oil-and-gas.case
Case source: https://www.neochart.com/catalog/cases/f-supp-3d/volume_354/0384_01/index.html
A reasonable investor would not understand the fact the SEC is not investigating Northern Oil to mean that Northern Oil did not do anything wrong.
Consequently, as it did for the FAC, the Court finds that Plaintiff fails to allege an actionable misstatement or omission by Defendants.
To satisfy the PSLRA's pleading requirements for scienter, a plaintiff must allege facts with particularity that would give rise "to a strong inference that the defendant acted with the required state of mind."
Even if Plaintiff had sufficiently alleged a misstatement or omission in the SAC, his claims would nonetheless fail because he has not sufficiently alleged scienter.
Consequently, as it did for the FAC, the Court finds that Plaintiff fails to establish the requisite scienter under § 10(b) and Rule 10b-5.
casedsl 1.2 # author: Flash3 (gemini-3.8-flash-high) # triaged-by: Fable (2026-11-10) case /f-supp-3d/354/0384-01 name Fries v. N. Oil & Gas, Inc. cite 354 F. Supp. 3d 384 (2018) # IR court field says: United States District Court for the Southern District of Illinois court United States District Court for the Southern District of New York date 2018-12-10 url catalog/cases/f-supp-3d/volume_354/0384_01/index.html source ir/caselaw/f_supp_3d_354.jsonl sha1=857c9bd0a21a7cc707017bbdfac5639e8c195973 chars=29397 # single district-court opinion (Ramos, J.); its two footnotes are appended at @28174.. and belong to the same opinion opinion op : majority by Ramos @0..29397 controlling party p1 : Northern Oil and Gas, Inc. and officers count c1 : class action securities fraud law 15usc78j role applied posture private securities fraud class action; motion to dismiss second amended complaint under Rule 12(b)(6) and PSLRA granted with prejudice result claimant-lost element statement : not-satisfied [pleaded] party p1 count c1 route omission-and-duty-to-disclose pattern 10-Q acknowledges an SEC investigation of an affiliate and says the company is not its focus; company's own uncharged involvement not disclosed fact @14479..14671 [supports] | Based on the information available to it, the Company does not believe that it, or any conduct by the Company, is the focus of any investigation by a governmental agency regarding this matter. fact @1713..1890 [supports] | Second, Defendants knowingly used Northern's staff, space, and resources to help Reger and Dakota Plains, including by facilitating some of Reger and Dakota Plains's misconduct. fact @18048..18098 [cuts-against] | The SEC indeed was not investigating Northern Oil. rule @10908..11031 [quoted] | The failure to disclose material information does not amount to an actionable misrepresentation, absent a duty to disclose. rule @18467..18613 | A reasonable investor would not understand the fact the SEC is not investigating Northern Oil to mean that Northern Oil did not do anything wrong. held @20025..20162 | Consequently, as it did for the FAC, the Court finds that Plaintiff fails to allege an actionable misstatement or omission by Defendants. gloss District court holds Northern Oil had no duty to disclose its own uncharged, unadjudicated wrongdoing merely because its 10-Qs acknowledged the SEC investigation of Dakota Plains: the filings were literally true, did not deny illegal conduct, and stated no misleading opinion. The Code-of-Ethics and CEO-praise theories were rejected again for the reasons given in the earlier opinion (285 F.Supp.3d 706). element scienter : not-satisfied [pleaded] scope alternative party p1 count c1 route strong-inference-pleading pattern confidential witness places knowledge of the underlying misconduct years before the challenged filings; nothing about state of mind when the filings were made fact @24762..24853 [supports] | (4) Northern's board members knew that its resources were being allocated to Dakota Plains. fact @25558..25672 [cuts-against] | Indeed, CW1's allegations all concern events occurring years before the allegedly misleading statements were made. fact @25422..25557 [cuts-against absent] | The SAC cites no facts showing that Defendants engaged in conscious or reckless behavior in making the contested Form 10-Q disclosures. rule @20758..20968 | To satisfy the PSLRA's pleading requirements for scienter, a plaintiff must allege facts with particularity that would give rise "to a strong inference that the defendant acted with the required state of mind." held @20175..20340 | Even if Plaintiff had sufficiently alleged a misstatement or omission in the SAC, his claims would nonetheless fail because he has not sufficiently alleged scienter. held @25873..26012 | Consequently, as it did for the FAC, the Court finds that Plaintiff fails to establish the requisite scienter under § 10(b) and Rule 10b-5. gloss Alternative holding: knowing the facts that (on plaintiff's theory) had to be disclosed is not the same as knowing the 10-Q statements were misleading; motive was alleged only conclusorily.