Full opinion text
ORDER . McKNIGHT, United States Magistrate Judge. This matter is before the Court with the consent of the parties for ruling on Defendants’ Motion to Dismiss. [Doc. 41.] Oral argument was held on the motion and the matter is now ripe for resolution. OVERVIEW Twelve class action suits were filed against Defendant First Union and its directors. These suits were consolidated in this Court with Allen v. Crutchfield as the lead case. The complaint and amended complaint allege securities fraud under Section 10(b) of the Exchange Act consisting of: (1) misrepresentation by officers in statements and omissions regarding the effects on earnings of First Union’s acquisitions; and (2) violations of GAAP (Generally Acceptable Accounting Procedures) as to certain losses. More specifically, regarding misrepresentations in statements and omissions, Plaintiffs allege that during the class period of August 14, 1998, to May 25, 1999, First Union’s stock was artificially inflated because First Union misrepresented the effects of integrating recent acquisitions into First Union’s corporate structure. Primarily the allegations concern the acquisition of CoreStates, a rival bank which comprised one-third of First Union’s total value post-acquisition, in August of 1998. It is uncontested that problems during the integration of CoreStates into First Union’s structure caused customer and financial loss resulting in the revised lowered expectations for earnings announcement in May. This announcement caused stock prices to hit a seven-year low, resulting in allegedly “heavy” losses for Plaintiffs. Plaintiffs allege the officers knew about the problems but made statements or omissions representing to the public that the integration was going smoothly. Pointing to Defendants’ selling of their own shares of First Union stock during the class period, Plaintiffs base their fraud claim on Defendants’ motive and opportunity to defraud investors for personal gain. Defendants respond that the directors’ sales of stock were relatively small compared to their net holdings and that each director actually owned more First Union stock at the close of the class period than at the beginning, belying any motive argument. As to the statements identified as misleading, Defendants respond that none are actionable because they were either (1) made by analysts or other non-First Union people; (2) not shown to be false when made; (3) statements that, under caselaw, would be deemed “puffery” that no reasonable investor would rely on; or (4) they were protected statements under the safe-harbor provisions of the Private Securities Litigation Reform Act (protecting “forward-looking” statements if identified as such with cautionary language). As to omissions, or failure to warn the public of problems, First Union responds that either it released that information as it became available or that the problems were reported in the press. Regarding the GAAP allegations, First Union responds that the procedures used do not constitute violations of GAAP. For the reasons discussed below, this Court finds that Plaintiffs cannot meet their burden under the applicable pleading standards, and as such, the motion to dismiss should be granted. I. Relevant facts and related allegations The following facts are either taken from the Amended Complaint and the documents referenced therein or are facts of which this Court takes judicial notice. A. First Union and Its 1998 Acquisitions First Union is a Charlotte, North Carolina-based bank holding company that provides financial services and products. Doc. 1, Compl. ¶ 15. During the relevant time periods, the three individual Defendants were all officers of the Company. Edward Crutchfield served as First Union’s Chairman and Chief Executive Officer. Compl. ¶ 16. John Georgius was First Union’s President from January 1998 until August 1999. Id. ¶ 17; see also Appendix Tab I (Annual Report on Form 10-K for the year ended December 31, 1998 (“1998 Form 10-K”) at 8). James Hatch was First Union’s Senior Vice President and Corporate Control Accounting Officer. Id. ¶ 18. First Union is the nation’s sixth largest bank with assets of over $237 billion. It has achieved that growth in large part due to acquisitions. See Appendix Tab 1 (1998 Form 10-K Annual Report at i). Since 1985, First Union has completed nearly eighty acquisitions, as the Company grew from 5,000 to more than 75,000 employees. Appendix Tab 1 (1998 Form 10-K) at 1. The $20 billion CoreStates acquisition, completed April 28, 1998, was First Union’s largest. It stands at the heart of this cause of action. While the relevant class period starts in August 1998, First Union’s disclosures concerning the CoreStates acquisition began nine months earlier. On November 18, 1997, First Union issued a press release (“November 18, 1997 press release”) and filed a Report with the SEC on Form 8-K (“November 18, 1997 8-K”) announcing its intent to acquire CoreS-tates, subject to several conditions, including regulatory approvals. Appendix Tab 2 (November 18, 1997 8-K and press release). The November 18, 1997 press release expressed the Company’s hope that the CoreStates merger would be “cumulatively accretive within 18 months” — that it would improve the combined earnings of the institutions by mid-1999. Id. at 2. At the same time, First Union cautioned investors about risks in the acquisition. For example, the November 18, 1997 8-K stated that the merger announcement contained forward-looking statements, specifically identifying “statements related to cost savings, enhanced revenues and accretion to reported earnings that may be realized from the [CoreStates] Merger.” Appendix Tab 2 at 3. More specifically, the November 18, 1997 8-K warned that the Company’s expectations might not be met: Such forward-looking statements involve certain risks and uncertainties, including a variety of factors that may cause the Corporation’s actual results to differ materially from the anticipated results or other expectations expressed in such forward-looking statements. Factors that might cause such a difference include, but are not limited to: (1) expected cost savings from the Merger and the Corporation’s other pending acquisitions may not be fully realized or realized within the expected time frame; (2) revenues following the Merger and the other pending acquisitions may be lower than expected, or deposit attrition, operating costs or customer loss and business disruption following the Merger and the other pending acquisitions may be greater than expected; (3) competitive pressures among depository and other financial institutions may increase significantly; (4) costs or difficulties related to the integration of the business of the Corporation, CoreStates, and the other pending acquisitions may be greater than expected; ... and (8) changes may occur in the securities markets. Appendix Tab 2 (November 18, 1997 8-K) at 3. On February 27, 1998, First Union announced that it expected to consummate the CoreStates acquisition by April 30, 1998. Appendix Tab 3 (February 27, 1998 press release). On April 13, 1998, the Federal Reserve Board approved the CoreStates acquisition, Appendix Tab 5 (April 13, 1998 press release), and First Union reported on steps it was taking to integrate the operations of the two institutions. Appendix Tab 6 (April 27, 1998 press release). The merger was consummated on April 28, 1998. Appendix Tab 7 (April 28,1996 8-K). In the months that followed, the Company continued to advise the public that expectations for the CoreStates acquisition might not be met. For example, on page one of its Annual Report on Form 10-K for the year ending December 31, 1997 (“1997 Form 10-K”), filed on March 23, 1998, First Union stated that anticipated expense savings and revenue .enhancements from the CoreStates acquisition, among other factors, could cause the Company’s results to- differ materially from the Company’s forward-looking statements. Appendix Tab 8 at 1. The 1997 Form 10-K, like the Company’s pronouncements before and during the “Class Period”, also incorporated the risk factors that had been included in the November 18, 1997 8-K. B. Statements during the Class Period On August 14, 1998, First Union filed its Report on Form 10-Q for the second quarter ended on June 30, 1998 (“1998 Second Quarter 10-Q”), which made the following statements about integration of First Union’s 1998 acquisitions: We are very pleased with our progress in integrating recent acquisitions and with the growth prospects stemming from these transactions. We believe 1998 will continue to be a very active year as we work to develop new markets and business strategies into revenue growth. In addition to revenue growth, we expect further improvements in efficiency as we begin to benefit from the consolidation of our recent acquisitions. With our previously pending acquisitions now completed, our primary attention is focused on developing our existing business base as we continue to invest in new technology and fee income-generating lines of business. The acquisition of CoreStates of Philadelphia will create new opportunities to leverage our growing Capital Management and Capital Markets businesses in states that generate 36 percent of the nation’s gross state product and in attractive consumer markets where the per capita income is 12 percent above the national average. In addition, in the second Quarter of 1998, we completed the purchase accounting acquisitions of Bowles Hollowell Conner & Co., an investment banking firm, and The Money Store, a nationally recognized consumer finance company. Compl. ¶¶ 36-37. First Union shared other information with investors during this period including the 1998 Second Quarter 10-Q’s cautionary language similar to that contained in the 1997 Annual Report. Appendix Tab 12 (1998 Second Quarter 10-Q) at 1. Further, First Union’s detailed discussion of its operating results included the following disclosure: Merger-related and restructuring charges in the-first six months of 1998 of $653 million after tax were associated primarily with the April 28,1998 acquisition of CoreStates Financial Corp. Id. at 2. The Company also disclosed that additional expenses, excluding merger-related charges, jumped to $3.8 billion in the first half of 1998, “primarily due to ... ongoing expenses related to acquired entities,” and that there had been a decline in tax-equivalent net interest income due, among other things, to “purchases to leverage the CoreStates acquisition.” Id. at 9. Likewise, the Company predicted that “an additional $165 million in after-tax merger-related and restructuring charges related to CoreStates may be recorded by the end of 1998.” Id. at 10. Between August 14 and November 13, 1998, the day the Company filed its Report on Form 10-Q for the quarter ended September 30, 1998 (“1998 Third Quarter 10-Q”), the integration of the now-completed acquisitions of CoreStates and the Money Store was on-going. The conversion of First Union’s and CoreStates’ computer systems was not completed until November 1998 and, as such, it was not until then that First Union had access to CoreStates’ operating results in one integrated system of reports. Thus, First Union promptly disclosed what it learned from that information. First Union made other public comments indicating that there were hitches in the integration process. The media issued several reports on problems First Union was experiencing. For example, in early November when First Union converted CoreStates’ computers to a combined system, one newspaper reported that: long lines of customers and cars crowded former CoreStates branches and drive up windows last week, as bank workers coped with new systems and fees.... Rival banks ... are hoping frustration over changing fees, branch closings and other merger issues would drive former customers of the region’s biggest bank to move their money elsewhere. Appendix Tab 19 (Pittsburgh Postr-Gazette, November 10, 1998, at C-8). Still other accounts quoted First Union officials, “weary from the many public relations problems that have plagued the merger,” as saying “Nothing is ever a 10 [on a scale of 1 to 10]. Not something this big, anyway.” Appendix Tab 20 (American Banker, November 18, 1998, at 6). That article, which Plaintiffs cite, notes that: First Union officials don’t deny there were a few bumps in the road. Customers faced long lines at many branches during the 10 day conversion, and at one point the entire First Union branch network had to deal with a 45-minute computer glitch that forced tellers to work off-line. Id. Compl. ¶ 50. First Union filed its 1998 Third Quarter 10-Q in mid-November, after the investing public had already been made aware of problems associated with the integration efforts by the above comments. That 10-Q again reminded investors of the uncertainties the Company was facing. It reported earnings of $2.7 billion or $2.77 per share for the nine months ended September 30, 1998. Appendix Tab 13. In addition, it repeated warnings about its operating results and cautioned investors about the forward-looking nature of statements contained in the report. Among the factors that First Union warned could affect the accuracy of its predictive statements were its “acquisitions,” and related factors. Id. at 1. With particular reference to the CoreStates merger, the Form 10-Q provided additional cost information, noting, for instance, that First Union took after-tax merger-related and restructuring charges of $669 million during the first nine months of 1998, compared with only $37 million the prior year. Id. at 2. In reporting on the completion of the CoreS-tates integration, First Union observed in statement it identified as forward-looking that: [c]ustomer sales and retention strategies are well under way, as well as efforts to achieve expense efficiency targets by the end of 1998. As such, we are very pleased with our prospects for revenue growth and expense reductions stemming from this and other recently consolidated acquisitions. Id. at 3 (emphasis added). The Amended Complaint alleges that these statements were false and misleading because, while the merger and the conversion of separate information systems may have been finalized, the integration of CoreStates was not really complete and that retention strategies were not working. Compl. ¶ 54. Thus, Plaintiffs conclude “the Company had no basis to he pleased.” Id. However, there were public reports identifying problems with the conversion during this period. For example, in late November 1998, First Union announced a computer problem caused by VISA and Microsoft’s “Money” software that resulted in double-billing some accounts prior to its being remedied. Appendix Tab 21 {The Charlotte Observer, November 21, 1998). Likewise, the Company reported a temporary problem with its direct-deposit systems. Appendix Tab 22 (Philadelphia Inquirer. December 2, 1998, at C3). Other anecdotal problems were detailed in news accounts. For instance, the Philadelphia Inquirer, on December 29, 1998, commented that: Appendix Tab 23 (Philadelphia Inquirer, December 29,1999, at 2). First Union’s purchase of Philadelphia’s CoreStates has been great for business — say analysts who follow rival Commerce Bancorp. In the weeks before the [First Union-CoreStates] conversion became official ..., Commerce [Bancorp] ... won nearly 40 percent of its new accounts from First Union/CoreStates ... That’s up from 26 percent during the previous two years. The Complaint cites a December 16, 1998 press release relating to efforts to market the Company’s mutual fund and investment products overseas. That release stated, in part: The International Division serves more than 1,400 correspondent bank account relationships in more than 130 countries, through 5 foreign branches and 29 representative offices abroad. Through its acquisition of Corestates Bank, First Union has maintained a presence in Japan since 1976. Compl. ¶ 56. Plaintiffs contend that this statement reflecting CoreStates’ presence overseas was misleading because it failed to disclose “the multitude of problems the Company was then experiencing with its international operations.” Plaintiffs present no evidence that these problems warranted disclosure. C. Reduction of Earnings Estimates Following the November 1998 conversion of the CoreStates systems, First Union revised its earlier estimates. On January 26, 1999, First Union issued an early warning of the prospect of reduced earnings for 1999. Compl. ¶¶ 64-65; Appendix Tab 25 (January 26, 1999 press release) at 1. In its press release, First Union announced that it would eliminate its “gain on sale treatment” of securitization activities related to certain loans and that it was cutting 1999 earnings expectations by 8 to 12 cents per share. Appendix Tab 25. The release noted that the “accounting change, uncertainty in the economy and our continued investments in strategic initiatives” led the Company to conclude that lower goals were appropriate. Id. The press reported that, despite cost-cutting efforts, First Union expected to miss its savings goals by $50 million and its revenue goals by $100 million, as a result of the CoreStates merger. Appendix Tab 26 (Philadelphia Inquirer, January 28, 1999, at Cl); see also Appendix Tab 27 (The Charlotte Observer, January 31, 1999). At the same time, the Company announced an extra $150 million in expenditures to complete its “Future Bank Initiative,” its effort to streamline service and to direct more customers to ATMs and telephone banking. Appendix Tab 26 (Philadelphia Inquirer, January 28,1999, at Cl). Plaintiffs allege that this warning was false and misleading because it failed to reveal the “magnitude and severity” of the integration problems and as a result “lulled” investors into believing that the problems would result in “marginally” decreased earnings. Compl. ¶ 66. As Defendants point out, the investing public, was hardly “lulled.” Following the Company’s January 26 disclosures, First Union’s stock dropped about 9 percent (Comply 8), its biggest drop in seven years. Appendix Tab 18 (stock price chart) see also Appendix Tab 28 {New York Times, January 28, 1999, at C-4). Despite the market’s reaction to First Union’s warning, Plaintiffs assert that the Company’s 1998 Form 10-K, filed March 16, 1999, was misleading. Appendix Tab L The 1998 Form 10-K included financial statements audited by KPMG LLP (“KPMG”), the Company’s outside auditors. KPMG certified that First Union’s financial statements “present fairly, in all material respects, the financial position ... for each of the three years ended in the three year period ended December 31, 1998, in conformity with generally accepted accounting principles.” Id. at C-2. The 1998 Form 10-K stated that “we completed the CoreStates conversion. Customer sales and retention strategies are well under way, as well as efforts to realize expense efficiencies. As such, we are encouraged with our prospects for revenue growth and for expense reductions in 1999 stemming from this and other recently-consolidated acquisitions.” Compl. ¶ 70. The 1998 Form 10-K also observed: Four 1998 acquisitions expanded our product line and added scale for our products and services ... We provided a full range of products to the former CoreStates customer base, leveraging CoreStates’ expertise in global trade finance with First Union’s broader geographic coverage and Capital Markets capabilities. Compl. ¶ 69 (emphasis in Complaint). First Union also repeated its warnings that 1999: will be a challenging year for the financial services industry, including First Union. Accordingly, in late January 1999, we announced a modified goal for 1999 operating earnings per share growth. Appendix Tab 1 (1998 Form 10-K Annual Report) at 8. Shortly thereafter, First Union issued further disclosures. On March 19, the Company issued a press release that, while reaffirming its most recent outlook for 1999 earnings, announced that management had “taken decisive action” to “reduce operating expenses.” Appendix Tab 29 (March 19, 1999 press release). The Company stated that these cuts were aimed at cutting pre-tax costs by $400 million to bring expenses in line with revenues. Appendix Tab 30 (The Charlotte Observer, March 20, 1999) see also Appendix Tab 31 (Richmond Times Dispatch, March 20, 1999, at C-i). The Company also disclosed merger-related and restructuring charges of $380 million for the quarter, including $30 million related to the CoreStates merger and restructuring. Appendix Tab 29 (March 19, 1999 press release) at 1-2; see also Appendix Tab 31. On April 15, First Union announced first quarter 1999 results in line with its revised lower projections. Appendix Tab 32 (April 15, 1999 press release) at 1. As predicted, first quarter earnings were $706 million, down 11% from the prior year, even with $118 million from the sale of the Company’s Electronic Data Systems holdings. Id. The Company’s release also explained that these earnings figures included a $259 million charge incurred for the CoreStates acquisition. Id. The release quoted Mr. Crutchfield as being satisfied “with the disciplined way our company focused on reducing our cost structure” as the Company announced in March. Compl. ¶ 75. He again cautioned, however, that 1999 would continue to be “a challenging year” that would require First Union to control costs and gain new sources of revenue Id. See also Appendix Tab 33 (Washington Times, April 21,1999, at B-9). The Amended Complaint alleges that Mr. Crutchfield’s statement was false and misleading in that he failed to disclose the specific problems and costs the Company was facing. Compl. ¶ 76. At the same time, the Amended Complaint fails to identify the particular facts Mr. Crutchfield knew that supposedly rendered his statement misleading. Similarly, Plaintiffs contend that First Union’s Form 10-Q for the first quarter of 1999 (“1999 First Quarter 10-Q”), filed May 5, 1999, was false and misleading. The 1999 First Quarter 10-Q reflected the foregoing operating results and also disclosed that noninterest expenses during the quarter increased to $2.5 billion, primarily as a result of merger-related and restructuring charges, including increased personnel costs. Appendix Tab 16 (1999 First Quarter 10-Q) at 2. Apart from its assertion that the report failed to disclose the Company’s problems integrating CoreStates, the Amended Complaint fails to allege that any specific statement in this filing was inaccurate. More than seven months before year end, First Union told investors to expect even lower 1999 earnings. On May 25, 1999, the Company announced that, notwithstanding its restructuring and cost-cutting measures, it did not expect to meet revised earnings estimates. Compl. ¶¶ 80-81; Appendix Tab 34 (May 25, 1999 press release). First Union observed that, during the first half of 1999, it was faced with overcoming the impact of substantial 1998 unusual noncore earnings items, major acquisition integration and acceleration of spending for major initiatives as we deploy a new business model ... This is an important transition year as we strategically reposition our company for the future. We are compressing a number of initiatives and acquisition consolidation into a short time frame. Appendix Tab 34 (May 25, 1999 press release). The Company stated that revenue shortfalls were due mainly to lagging revenue growth in the former CoreStates territory, which failed to match the Company’s expectations, as well as disappointing Money Store results, implementation of the Future Bank project and, finally, its decision not to realize certain securities gains it previously expected. Id. at 2. Following First Union’s announcement, the price of First Union stock fell by $47 % to $45 5/8. Appendix Tab 18 (stock price summary). The first securities fraud lawsuit was filed within two weeks of First union’s May 25, 1999 announcement. By August, twelve nearly identical suits had been filed, all of which have been' consolidated here. D. Accounting Allegations Although not alleged in the original complaint, the Amended Complaint added 26 new paragraphs describing First Union’s accounting treatment of the gain or losses on certain mortgage-backed securities. Compl. ¶¶ 91-116. These securities related to First Union’s asset securitization program, through which the Company or its predecessors made loans, combined the loans into pools and sold interests in those pools. Id. ¶ 92. In the case of home equity and home improvement loans, the Company often kept a residual interest in the pools consisting of a right to receive a portion of the interest paid on the loans. These “interest only” residual interests, defined in the Complaint as Mortgage Backed Securities, were carried on the Company’s books as “trading securities,” and their fair value was calculated on a monthly basis using various assumptions about interest rates and anticipated default and prepayment rates. Appendix Tab 12 (1998 Second Quarter 10-Q) at 11-12. The existence of the securities, the methodology for valuing them, the assumptions used in valuing them, the fair value of these securities, and the gain or loss to the Company, were disclosed in the Company’s periodic reports. See id.; see also Appendix Tab 13 (1998 Third Quarter 10-Q) at 12-13. In 1999, in accordance with a newly promulgated accounting standard, First Union changed its method of accounting so that a loss was recorded only when the securities were deemed to be impaired. Appendix Tab (1998 Form 10-K Annual Report) at 17. First Union took a $19 million impairment loss in the First Quarter of 1999,and a $60 million impairment loss in the Third Quarter of 1999. Appendix Tab 16 (1999 First Quarter 10-Q) at T-11 and Tab 35 (1999 Third Quarter 10-Q) at 7-8. Plaintiffs allege in conclusory terms that, due to disruptions in market conditions in the Fall of 1998 resulting in a “flight to quality,” these securities should have been revalued in that year, but that the loss was deferred to conceal problems with the Money Store merger. Compl. ¶¶ 97-98. The Amended Complaint contains no specific factual averments buttressing Plaintiffs’ claims; instead this claim appears to be premised exclusively on the supposition that the 1999 revaluation proves that Defendants knew of the impairment at an earlier time. Thus, despite the absence of any supporting factual allegations, Plaintiffs allege First Union’s pre-tax earnings in 1998 were overstated by at least $79 million — the amount of the impairment recognized in 1999. Compl. ¶ 104. II. Applicable Pleading Standards The Amended Complaint alleges that each of the Defendants violated Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. § 78j(b) (1994), and Rule 10b-5, 17 C.F.R. § 240.10b-5 (1999). Plaintiffs further allege that the individual Defendants are “controlling persons” of First Union under Section 20(a) of the Exchange Act, 15 U.S.C. § 78t(a) (1994), and are therefore individually liable for the Company’s alleged violations of Section 10(b) and Rule 10b-5. A. Rule 12(b)(6) A motion to dismiss pursuant to Fed. R.Civ.Pro. 12(b)(6) will not be granted unless “it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Conley v. Gibson, 355 U.S. 41, 45-6, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). In reviewing the complaint, the Court accepts all well-pled allegations as true and construes the facts and reasonable inferences derived therefrom in the light most favorable to the plaintiff. Ibarra v. United States, 120 F.3d 472, 473 (4th Cir.1997). In deciding a Rule 12(b)(6) motion, the court will consider the facts stated in the complaint and the documents attached to the complaint. In securities fraud actions, courts will also “examine the other information that was publicly available to reasonable investors at the time the defendant made statements plaintiffs alleged were fraudulent,” including documents or articles cited in the complaint, SEC filings, press releases, stock price tables, and other material on which plaintiffs allegations necessarily rely. See, e.g., Phillips v. LCI Int’l, Inc., 190 F.3d 609, 617 (4th Cir.1999) (court considered news article and company proxy statement); Bryant v. Avado Brands, Inc., 187 F.3d 1271, 1274-1281 (11th Cir.1999) (judicial notice of SEC filings); Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir.1998) (even if plaintiffs’ complaint does not refer to it, “a district court ruling on a motion to dismiss may consider a document the authenticity of which is not contested, and upon which the plaintiffs complaint necessarily relies.”), cert. denied, 525 U.S. 1001, 119 S.Ct. 510, 142 L.Ed.2d 423 (1998); Ritter v. Hughes Aircraft Co., 58 F.3d 454, 458-59 (9th Cir.1995) (judicial notice of widespread layoffs at Hughes Aircraft based on a newspaper article); In re FAC Realty Sec. Litig., 990 F.Supp. 416, 420 (E.D.N.C.1997) (Court could properly rely on press release and other public statements made by company and company’s Form 10-K in ruling on motion to dismiss). To survive the motion to dismiss, Plaintiffs must have alleged facts that show they are entitled to relief on their causes of action. To state a claim under Section 10(b) and Rule 10b-5, a plaintiff must sufficiently allege that: See e.g., Phillips v. LCI Int’l, Inc., 190 F.3d 609, 613 (4th Cir.1999). As discussed below, Plaintiffs have failed to satisfy, as a matter of law, the first and second requirements, and their Complaint should be dismissed. 1. the defendant misstated or omitted a material fact; 2. the defendant acted with scienter; 3. the plaintiff justifiably relied upon the misstatement or omission; and 4. the misstatement or omission proximately caused the plaintiffs loss. B. Rule 9(b) Because § 10(b) claims are fraud claims, Plaintiffs must further satisfy the pleading requirements imposed by Fed. R.Civ.Pro. 9(b). Rule 9(b) requires that plaintiffs plead all of the elements of fraud with particularity. Particularity of pleading is required with regard to the time, place, speaker, and contents, as well as the manner in which statements are false and the specific acts raising an inference of fraud — the “who, what, where, why and when.” See, e.g., Harrison v. Westinghouse Savannah River Co., 176 F.3d 776 (4th Cir.1999); In Re Criimi Mae, 94 F.Supp.2d 652 (D.Md.2000); Apple v. Prudential-Bache, 820 F.Supp. 984 (W.D.N.C.1992), aff'd sub. nom. 1993 WL 138523 (4th Cir.1993). As one court observed: Rigorous application of Rule 9(b) by the courts is especially important in securities fraud cases, where the potential for “strike suits” is serious. Thus, Plaintiffs must make particular allegations of the time, place, speaker, and contents of the allegedly false statements, as well as the manner in which the statements are false and the specific facts raising an inference of fraud. In re Medimmune, Inc. Sec. Litig., 873 F.Supp. 953, 960 (D.Md.1995). Additionally, Plaintiffs are forbidden from “grouping] defendants together without specifying which defendant committed which wrong” and are required instead to “set forth with particularity each defendant’s culpable conduct.” Apple v. Prudential-Bache Sec., Inc., 820 F.Supp. at 987 (W.D.N.C.1992); Juntti v. Prudential-Bache Sec., Inc., No. 92-2066, 1993 WL 138523 (4th Cir. May 3, 1993). Plaintiffs are required to disclose in their pleadings the sources upon which.their allegations rest, and courts will evaluate the sufficiency of the allegations in light of the reliability of the sources. Apple v. Prudential-Bache Sec., Inc., 820 F.Supp. at 986. The Private Securities Litigation Reform Act (“Reform Act”), 15 U.S.C. § 78u-4(b)(2), both codifies these requirements and imposes additional pleading requirements. For example, the Reform Act requires plaintiffs to identify each allegedly misleading statement and to specify the reason or reasons each statement was untrue or misleading at the time it was made. 15 U.S.C. § 78u-4(b)(l) (Supp. IV 1998). Moreover, where a complaint makes allegations on information and belief, plaintiffs must “state with particularity all facts on which that belief is formed.” Id. The Reform Act also preserves a plaintiffs obligation to base a Section 10(b) claim on statements that are not only factual but also material. Conf.Rept. at 44, reprinted in U.S.C.C.A.N. at 743 (“Courts may continue to find a forward looking statement immaterial-and therefore not actionable.”). Thus, each allegedly false or misleading statement must be evaluated for materiality. Further, under the Reform Act, when statements are “forward-looking,” they are not actionable at all, even if material, when they are accompanied by meaningful cautionary statements identifying important factors that could cause actual results to differ. 15 U.S.C. § 78u-5(c)(l) (Supp. IV1998). Most notably, in addition to the requirements for pleading a material false statement or omission, Plaintiffs also must satisfy the Reform Act’s requirements for pleading the requisite state of mind as to each defendant: [T]he complaint shall, with respect to each act or omission alleged to violate this chapter, state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind. 15 U.S.C. § 78u-4(b)(2) (Supp. IV 1998). Under this provision, the mental state needed to prove securities fraud is distinct from the level of pleading required to permit inference of that mental state. With respect to the requisite mental state, the Reform Act’s dictates vary, to some extent, with the nature of the allegedly false statements. For those few “forward-looking statements” that are actionable at all, the Reform Act specifies that the required state of mind is “actual knowledge ... that the statement was false or misleading.” 15 U.S.C. § 78u-5(c) (Supp. IV 1998). For statements outside the statutory safe harbor, the “required state of mind” in Section 78u-4(b)(2) refers to the scienter requirement applicable to Rule 10b-5 claims prior to the Reform Act. See, In re Comshare, 183 F.3d 542, 550 (6th Cir.1999); Phillips v. LCI Int’l. Inc., 190 F.3d at 620. The Supreme Court has defined “scienter” as a mental state embracing “intent to deceive, manipulate, or defraud.” See Ernst & Ernst v. Hochfelder, 425 U.S. 185, 193-94 n. 12, 96 S.Ct. 1375, 47 L.Ed.2d 668 (1976). Although the Court left open the question whether recklessness satisfies this standard, the Fourth Circuit has defined scienter restrictively: “Scienter exists if the defendant knew the statement was misleading or knew of the existence of facts which, if disclosed, would have shown it to be misleading.” Banca Cremi, S.A. v. Alex Brown & Sons, Inc., 132 F.3d 1017, 1037 n. 26 (4th Cir.1997) (citation omitted). See also Malone v. Microdyne Corp., 26 F.3d 471, 479 n. 9 (4th Cir.1994). Most recently, the Fourth Circuit held that “to establish scienter, a plaintiff must still prove that the defendant acted intentionally, which may perhaps be shown by recklessness.” Phillips v. LCI Int’l. Inc., 190 F.3d at 620. As to the distinct issue of how plaintiffs must plead intent, the Reform Act “indisputably seeks to make pleading scienter more difficult for plaintiffs.” Phillips v. LCI Int’l, Inc., 190 F.3d at 621 (citations and quotation marks omitted).- While courts have disputed precisely how stringently the Reform Act pleading standard should be interpreted, see id., there is no disagreement on one critical point: the Reform Act imposes a stricter standard than was previously employed. At a minimum, that standard is the Second Circuit’s pre-Reform Act pleading requirement, which was the most stringent at the time, requiring plaintiffs to plead: (1) facts establishing a motive to commit fraud and an opportunity to do so or (2) facts constituting circumstantial evidence of either reckless or conscious behavior. In re Time Warner Inc. Sec. Lit., 9 F.3d 259, 269 (2nd Cir.1993), cert. denied, 511 U.S. 1017, 114 S.Ct. 1397, 128 L.Ed.2d 70 (1994). Indeed, all five Courts of Appeal that have squarely addressed the issue have held that the Reform Act elevated the pleading standard above the pre-Reform, Act Second circuit standard; in addition, with the apparent exception of the Third Circuit, all have held that merely pleading motive and opportunity no longer suffices. The plain language of the Reform Act requires that the Amended Complaint “state with particularity facts giving rise to a strong inference that the defendant [knew that a statement or omission was false or misleading].” At a minimum, this requires that: (1) For each alleged misstatement or omission, plaintiffs must plead specific facts concerning, for example, when each defendant or other corporate officer learned that a statement was false, how that defendant learned that the statement was false, and the particular document or other source of information from which the defendant came to know that the statement was false; (2) Only “particularized” facts can be considered in determining whether the plaintiff has met the pleading burden (ie. it is the particularized “facts” plaintiffs plead that must support the strong inference); and (3) It is not sufficient for a plaintiff to plead facts that could plausibly be consistent with innocent conduct. To survive a motion to dismiss the facts alleged must create a “strong inference” of wrongful intent. Whether taken as a whole or examined allegation-by-allegation, the Amended Complaint does not meet these standards and, therefore, must be dismissed. III. Analysis With regard to the alleged misrepresentations in statements or omissions, this analysis will address: (A) initially, whether the complaint is capable of statement-by-statement analysis; and (B) a statement-by-statement examination. A discussion of (C) the alleged GAAP violations follows. Lastly, this analysis addresses an alternative ground to dismiss the action, (D) the failure to adequately plead scienter. As an initial matter, as the pleading requirements demonstrate, “it is not the law that a 10b-5 complaint is to be judged on the basis of the general flavor derived from an issuer’s collective statements over a long period of time.” In re Boston Tech. Inc. Sec. Lit., 8 F.Supp.2d 43, 55-56 (D.Mass.1998). Instead, to survive a motion to dismiss, a complaint must withstand an exacting statement-by-statement analysis. See 15 U.S.C.A. Section 78u-4(b)(2); Phillips v. LCI International, 190 F.3d at 617 (“Having stripped the stockholders’ allegations of mischaracterizations and exaggeration, we focus on whether the exact statement in its true context constitutes a material representation.”). This does not mean, however, that complaints like the instant one may not be dismissed based on their overall defects. Indeed, complaints failing to comply with the Reform Act’s requirements must be dismissed. 15 U.S.C. § 78u-4(b)(3)(A) (Supp. IV1998). A. Capability of Statement-by-Statement-Analysis Dismissal for pervasive pleading defects is particularly appropriate when those defects prevent this court from performing the required analysis. See Shapiro v. UJB Fin. Corp., 964 F.2d 272, 284 (3rd Cir.1992) (remanding with direction that plaintiffs “rearrange the existing allegations into discrete units that are, standing alone, each capable of evaluation under the legal principles we have set forth.”) The Amended Complaint here exhibits several such flaws. 1. Failure to Specify Why Each “Misstatement” is Misleading Plaintiffs fail to meet the Reform Act’s requirement that each allegedly misleading statement be accompanied by allegations explaining why it is misleading. 15 U.S.C. § 78u-4(b)(l). Rather than abiding by this requirement, the Amended Complaint repeatedly refers to a list of alleged operational problems that may or may not have anything to do with the statement. As Defendants point out, this approach leads to some patently false allegations. For example, the Amended Complaint alleges that statements concerning First Union’s expectations for the merger made in the 1998 Second Quarter 10-Q were misleading because they failed to disclose problems the Company was encountering “as detailed in ¶¶ 7 (a) through 7(aa) above.” Compl. ¶ 40. Those 27 subpara-graphs contain allegations of allegedly “significant and material obstacles” to the CoreStates merger. Notably, many of these events are not alleged to have occurred until- months after the Second Quarter 10-Q was issued in August 1998. See, e.g. ¶ 7(h) (events between October 1998 and June 1999); and ¶ 7(i) (events in November 1998 and March 1999); 7(j) (event in January 1999); ¶ 7(o) (events in December 1998). Others have no time frame assigned to them whatsoever. It is Plaintiffs’ burden to plead fraud on a statement-by-statement basis and they may not evade that requirement by relying on this Court and the Defendants to try to match particular allegations scattered throughout a sixty-page complaint. Defendants argue that on this basis alone, the Amended Complaint should be dismissed. 2. Failure to Allege Scienter With Respect to Each “Misstatement” Further, Plaintiffs make no effort to link their scienter allegations to any specific alleged misstatement. This violates another of the Reform Act requirements: that “the complaint shall, with respect to each act or omission ... state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind.” Exchange Act Section 21D(b)(2); 15 U.S.C. § 78u-4(b)(2). Instead, the Amended Complaint contains a number of separate sections containing broad allegations that ostensibly relate to scienter, such as Plaintiffs’ list of alleged operational issues. Compl. ¶¶ 7, 57. There is, however, no allegation that any item on the list was known to any individual Defendant (or to any of the Company’s other senior officials) at the time the allegedly false statements were made. Plaintiffs try to overcome this deficiency through “group pleading,” the practice of contending that because of their positions as corporate officers, defendants must have known of the allegedly false and misleading nature of all the alleged misstatements, and are therefore collectively responsible. Compl. ¶ 21. But “group pleading” is clearly inconsistent with Rule 9(b)’s express requirements of specificity. See In re Boston Tech., 8 F.Supp.2d at 57-58 (citations and internal quotation marks omitted) (“As to every piece of alleged bad news in the case, plaintiffs fail to assert any facts as to defendants’ knowledge of that news ... A 10b-5 plaintiff must allege ‘details of [defendants’] alleged fraudulent involvement,’ including specifics as to what defendants had knowledge of and when.”) It is therefore contrary even to pre-Reform Act law. Apple v. Prudential-Bache Sec., 820 F.Supp. at 987. The only allegations suggesting that any Defendant was aware of integration issues refer to statements made after or at the time that the problems were disclosed. For example, Plaintiffs repeatedly cite statements made by Mr. Crutchfield after the “Class Period.” Yet these statements contain no suggestion that Mr. Crutchfield was aware of these issues at the time that the allegedly false statement was made (in some cases more than nine months earlier). This practice of alleging “fraud by hindsight” — claiming that defendants knew of facts at an earlier time based on subsequent disclosures — has been categorically rejected by numerous courts. See, e.g., Hillson Partners Limited Partnership v. Adage, Inc., 42 F.3d at 209. 3. Failure to Allege Basis for Beliefs Plaintiffs also fail to comply with the Reform Act’s requirement to plead “with particularity all facts on which [their] belief is formed.” 15 U.S.C. § 78u-4(b)(1). This requires Plaintiffs to provide facts and disclose sources to corroborate their allegations. See In re Silicon Graphics, Inc. Sec. Lit., 183 F.3d at 985; Apple v. Prudential-Bache Sec. Inc., 820 F.Supp. at 985. This defect is particularly apparent where Plaintiffs allege that the Company was encountering difficulties in the integration process. See ¶¶ 7, 40, and 57. Plaintiffs provide little or no indication of the basis for these allegations. The Amended Complaint’s only effort to provide such a basis is a conclusory paragraph on the first page asserting that Plaintiffs’ accusations are based on: (a) review and analysis of public filings made by First Union Corporation (“First Union” or the “Company”), with the Securities and Exchange Commission (the “SEC”); (b) interviews with former employees of First Union; (c) review and analysis of securities analysts’ reports concerning First Union; (d) review and analysis of First Union press releases and reports and articles about First Union and/or the individual defendants in the financial and general press; (e) review and analysis of other publicly available information about First Union; (f) review and analysis of First Union financial statements and reports; and (g) consultation with certified public accountants. Similar conclusory language has been rejected as “an insufficient basis for fraud allegations because it fails to state with particularity all facts on which [her] belief is formed.” In re Silicon Graphics, Inc. Sec. Lit, 183 F.3d at 985 (citing 15 U.S.C. § 78u-4(b)(l)). Plaintiffs’ failure to plead with particularity the basis for their belief compels dismissal of the entire Amended Complaint. See Apple v. Prudential-Bache Sec., Inc., 820 F.Supp. at 986-87. B. Statement-by-Statement Examination Even if this Court conducts a statement-by-statement analysis of the Amended Complaint, dismissal would still be warranted. Neither of the two sources of misstatements asserted by Plaintiffs, whether the Company’s public filings and press releases, or analyst reports and newspaper or journal articles, supports a securities fraud claim. 1. Third-Party Analyst Reports and News Articles Much of the Amended Complaint is based on observations of securities analysts or journalists rather than on statements by Defendants themselves. However, liability may not be based on statements in analyst reports unless plaintiffs allege facts to establish that a specific false statement was actually made by a defendant or that the content of the analyst’s report was controlled by the defendant. See Raab v. General Physics Corp., 4 F.3d 286, 288 (4th Cir.1993) (complaint must plead with specificity who allegedly supplied information, how it was supplied, or how company controlled the content of the statement). The same analysis applies to newspaper stories. In re Medimmune, Inc. Sec. Litig., 873 F.Supp. at 965. Plaintiffs’ failure to provide this specificity warrants dismissal of the claims based on third-party reports and articles. Most of the allegations concerning analysts’ reports and news stories during the class period do not identify any statement attributable to the Defendants. For example: —Paragraphs 41 and 42 focus on reports containing information that was allegedly obtained from First Union management or the Company. These allegations, however, fail to indicate what information was supplied and who among the Defendants supplied it, nor do they indicate how Defendants) could have controlled the content of the reports. —Paragraph 49 alleges that Merrill Lynch Capital Markets issued a “BUY rating” after “direct consultations with First Union management.” It fails to allege who supplied what information to Merrill Lynch. Interestingly, that paragraph also indicates that the “CoreStates’ integration [was] completed ... successfully” statement was Merrill Lynch’s conclusion, not First Union’s. —Paragraph 61 cites a New York Times article, but the only statements by First Union referenced in it are unspecified earnings reports that Plaintiffs do not allege are false. Consequently, none of the foregoing statements can serve as the basis for a claim against Defendants. The three instances in which Plaintiffs cite analyst reports or journal articles that purport to quote First Union officers are also insufficient to create liability for the Defendants. First, Plaintiffs allege that Mr. Georgius told analysts that he was “feeling good about where CoreStates is.” Compl. ¶ 74. In addition to quoting from a newspaper article published after the “Class Period,” Plaintiffs omitted a key part of Mr. Geor-gius’ statement. The May 28, 1999 Wall Street Journal article read: “I’m feeling good about where CoreS-tates is,” John R. Georgius the bank’s president, told analysts in March, though he acknowledged sales gains were slower than expected. Appendix Tab 38 (emphasis added). In any event, the .“feeling good” statement is immaterial as a matter of law and therefore cannot support liability. See, Raab v. General Physics Corp., 4 F.3d at 289-90; In re Peritus Software Servs., Inc. Sec. Litig., 52 F.Supp.2d at 219 (statement that corporate executives “proud” of their accomplishments immaterial). Second, Plaintiffs misrepresent the words of an analyst report to turn a comment by Scott Fainor, a First Union vice president, into an allegedly misleading statement of historical fact. Paragraph 46 of the Amended Complaint alleges only that a November 5, 1998 Morning Call analyst’s report indicates that Mr. Fainor “represented the integration process as working ‘smoothly.’ ” However, the full quote is: [T] he problems associated with the CoreStates merger will be minimal. There are thousands of people working to make sure- that this integration will work smoothly, if there are issues, we’re set up to tackle them immediately. Referring to the integration process, Mr. Fainor stated, “[wje’re set up to grow, we want to put this behind us and move forward.” In fact, the report from which Plaintiffs extract the cited language clearly indicates that Mr. Fainor was not “representing” that the CoreStates integration process had been “working smoothly.” He was commenting on an incident involving certain misdirected letters and predicting that, despite the well-known difficulties associated with the early stages of the massive integration process, First Union had committed sufficient resources to address problems as they arose. The report text reads: In June, First Union officials were red-faced when thousands of CoreStates customers received letters informing them that their accounts would be moved to Sovereign. The letters were mailed to the wrong customers. The slip-up surprised folks who keep a close watch on mergers. It wasn’t something they expected from First Union, which has carried out multiple mergers. Fainor said First Union officials are prepared to handle problems that arise as the [CoreStates] conversion is carried out this weekend. Fainor said he expects the problems associated with the CoreS-tates merger will be minimal. “There are thousands of people working to make sure that this integration will work smoothly,” Fainor said. “If there are issues, we’re set up to tackle them immediately.” “We’re set up to grow,” Fainor said. “We want to put this behind us and move forward.” Appendix Tab 39 (The Morning Call, November 5, 1998). Plaintiffs’ assertion that Mr. Fainor “intended to convey the false impression that the integration process was proceeding without a hitch” (Comply 47) has no support in the evidence. Finally, Plaintiffs’ allegations relating to a November 18, 1998 newspaper article suffer from similar defects. The Complaint alleges (Complin 50-51) that First Union represented in that article that “any integration problems were over” and that “it’s now business as usual.” First, none of the statements in the article was attributed to a Defendant. More importantly, the statements in the article were uncon-troverted by Plaintiffs. For example, the first two sentences (from which Plaintiffs only selectively quote) actually read as follows: First Union Corp. said it wrapped up its conversion of the former CoreStates Financial Corp. last weekend. The conversion of three million customers’ accounts began Nov. 5 and was completed Saturday. Appendix Tab 20 (American Banker, November 18, 1998). Plaintiffs’ allegations about continuing customer service problems cannot render inaccurate the historical fact that First Union actually completed the conversion of particular customer accounts. Also true are the statements (Comply 50) that the conversion was “the largest and most complex” First Union had ever done and that “there were a few bumps in the road” such as that “[c]ustom-ers faced long lines at many branches.” In fact, the latter statement demonstrates that the market, knew of the very type of discrete problems that Plaintiffs maintain First Union should have disclosed. Plaintiffs also excise and try to isolate the statement “it’s now business as usual” from the following sentences: But overall, things went so well that First Union let workers take Veterans Day off instead of taking additional training, said Kim P. Hocutt, vice president of merger support for First Union. About 75 extra workers are being kept in the former CoreStates branches to help out with heavy traffic, said Ms. Hocutt. They are likely to stay there [until] mid-December. Other than that, “it’s now business as usual,” she said. Appendix Tab 20. These sentences clearly indicate that Ms. Hocutt, who is not a defendant or member of First Union senior management, did not consider the CoreStates situation to be “business as usual.” She was not discussing material matters related to First Union’s financial integration of CoreStates. She was merely commenting on the extra staffing requirements needed “to help out with heavy traffic” in various branches. Her statement comes nowhere close to being a viable predicate for Section 10(b) liability for any of the Defendants. 2. Remaining Statements Made by First Union Once the foregoing statements are eliminated as possible sources of liability, all that remains are statements from several SEC filings and press releases. As discussed below, none of the statements Plaintiffs pull from these documents is actionable. Virtually all are statements of optimism or forward-looking projections that cannot be a basis of liability, and the few statements of historical fact are either demonstrably true or not rendered misleading by any allegations supporting falsity. a. 1998 Second Quarter 10-Q The Amended Complaint alleges that three statements in the 1998 Second Quarter 10-Q were false and misleading. None of these allegations supports a securities fraud claim. The first alleged misstatement, that “[w]e are very pleased with our progress in integrating recent acquisitions and with the growth prospects stemming from these transactions” (ComplA 36), is the kind of statement Courts have held to be “puf-fery” and patently immaterial. See Grossman v. Novell, Inc., 120 F.3d 1112, 1121-22 (10th Cir.1997) (statements of the issuer’s president, chief executive officer, and chairman that the issuer “had experienced ‘substantial success’ in integrating the sales forces of the two companies, that the merger was moving ‘faster than we thought/ and that the merger presented a ‘compelling set of opportunities’ for the company were immaterial”); Shaw v. Digital Equipment Corp., 82 F.3d 1194, 1219 (1st Cir.1996) (holding the following statements to be “patently immaterial”: “[the] company’s transition to selling its Alpha chip products was going ‘reasonably well’”; company “should show progress quarter over quarter, year over year”; comment that company was “basically on track”). For the same reason, First Union’s statements that “1998 will continue to be a very active year” and that “we expect further improvements in efficiency” are not actionable. Raab v. General Physics Corp., 4 F.3d at 289 (statements in annual report that company expected “10% to 30% growth rate over the next several years” and was “poised to carry the growth and success of 1991 well into the future” held to be immaterial “soft puffing” statements). Finally, Plaintiffs cite the 1998 Second Quarter 10-Q prediction that the CoreStates acquisition “will create new opportunities to leverage our growing Capital Management and Capital Markets businesses in states that generate 36 percent of the nation’s gross state product and in attractive consumer markets where per capita income is 12 percent above the national average.” Compl. ¶ 37. Plaintiffs fault this prediction not for its factual assertions concerning the size of the potential market, but because the statement allegedly implied that the acquisitions “fortified” First Union’s growth potential efficiency and market position. Compl. ¶ 39. But commenting, as First Union did, on the existence of new potential opportunities is not an actionable misstatement. Under Grossman, Shaw, and Raab, for example, such statements are not actionable. See also Simon v. American Power Conversion Corp., 945 F.Supp. 416, 428-29 (D.R.I.1996) (expectation that “1995 [is going] to be a busy year” was immaterial sales talk; “statement touting ‘significance of newly emerging international markets and the vast potential for [defendant’s] products in these areas of the world’ ... was little more than corporate cheerleading.”) Plaintiffs also fail to allege a factual basis for contending that any of the 1998 Second Quarter 10-Q’s statements was misleading. The Amended Complaint alleges that First Union should have disclosed that it was “experiencing severe problems in integrating newly-acquired companies into its existing operations or that the process was taking longer and consuming substantially more resources than anticipated.” Compl. ¶ 39. For this proposition, the Amended Complaint cross-references the list of events in paragraph 7(a)-(aa). Yet only one of these events is alleged to have occurred as of the close of the second quarter on June 30, or even as of the filing of the 10-Q for that quarter on August 14. In any event, given the scale of the merger, the market would have regarded disclosure of discrete customer service problems associated with the massive CoreStates integration as immaterial. See e.g. Hillson Partners Limited Partnership v. Adage, Inc., 42 F.3d at 213 (“A reasonable investor knows that a capital improvement project may run into unforeseen problems and delays” and therefore no disclosure of such problems is required). b. 1998 Third Quarter 10-Q The next allegedly false and misleading statement attributed to a Defendant appears in First Union’s Third Quarter 10-Q filed on November 13, 1998 (not, as Plaintiffs state, on November 30): We have completed the integration of CoreStates. Customers sales and retention strategies are well underway, as well as efforts to achieve expense efficiency targets by the end of 1998. As such we are very pleased with our prospects for revenue growth and. expense reductions stemming from this and other recently consolidated acquisitions. Compl. ¶ 53 (emphasis omitted). Plaintiffs contend that the statement was false because “the integration of CoreStates was not completed.” Id. ¶ 54. Notwithstanding their assertions, Plaintiffs allege no facts showing that the integration had not actually been completed. Instead, Plaintiffs’ only attempt to buttress their assertion of falsity is to refer to their laundry list of alleged customer service and other operational problems contained elsewhere in the Amended Complaint. Compl. ¶ 54. Close inspection of Plaintiffs’ list reveals, however, that few of the problems alleged there had occurred before November 1998. More significantly, these alleged problems did not render false or misleading the statement that “we have completed the integration of CoreStat