Full opinion text
ORDER AFFIRMING AND ADOPTING THE REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE PAYNE, District Judge. On April 16, 2008, the United States Magistrate Judge entered his Findings and Recommendation. Plaintiffs filed an objection to the Magistrate Judge’s Finding and Recommendation within the time prescribed by law. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(a). This Court finds the Report and Recommendation of the Magistrate Judge is supported by the record. Therefore, upon full consideration of the entire record and the issues presented herein, this court finds and orders that the Report and Recommendation entered by the United States Magistrate Judge on April 16, 2003, be AFFIRMED and ADOPTED by this Court as its Findings and Order. Accordingly, this case shall be set for status and scheduling conference by separate order. REPORT AND RECOMMENDATION Joyner, United States Magistrate Judge. TABLE OF CONTENTS I. RECOMMENDATION REGARDING DEFENDANTS’ MOTIONS TO DISMISS.1090 II. INTRODUCTION.1090 A. BACKGROUND.1091 1. THE PARTIES.1091 2. PLAINTIFFS’ INTRODUCTION TO DEFENDANTS.1092 3. PLAINTIFFS’ INVESTMENT INTO THE DYMAS FUND.1092 III. PLEADING STANDARDS APPLICABLE TO PLAINTIFFS’ CLAIMS.1093 A. FED. R. CIV. P. 12(B)(6).1093 B. FED. R. CIV. P. 9(B).1094 C. THE PRIVATE SECURITIES LITIGATION REFORM ACT (“PSLRA”) .1094 IV. PERSONAL JURISDICTION ANALYSIS.1095 A. STANDARDS FOR EVALUATING PERSONAL JURISDICTION.1095 B. ANALYSIS.1096 1. DEFENDANT CAPITAL EQUITY’S CONTACTS WITH OKLAHOMA.1096 2. DEFENDANT SCMSI’S CONTACTS WITH OKLAHOMA.1097 (A) GENERAL PERSONAL JURISDICTION.1097 (B) SPECIFIC PERSONAL JURISDICTION.1098 (1) SPECIFIC JURISDICTION OVER CAPITAL EQUITY.1098 (2) SPECIFIC JURISDICTION OVER SCMSI.1100 V.OTHER DISPOSITIVE ISSUES 1100 A. FAILURE TO STATE A CLAIM UNDER THE 1934 ACT FOR UNLAWFUL MISREPRESENTATIONS OR OMISSIONS IN VIOLATION OF SECTION 10(B)/RULE 10B-5.1100 1. OVERVIEW.1100 2. FAILURE TO SATISFY FED. R. CIV. P. 9(B) STANDARDS: FAILURE TO PLEAD FRAUD WITH PARTICULARITY UNDER RULE 9(B) AND THE PSLRA.1102 3. FAILURE TO PLEAD FACTS SHOWING DEFENDANTS ACTED WITH THE REQUISITE STATE OF MIND (SCIENTER) PURSUANT TO THE PSLRA.1107 4. NO ALLEGATION OF LOSS CAUSATION. 1109 B. STATE LAW FRAUD CLAIMS INSUFFICIENT UNDER FED. R. CIV.P. 9(B).1110 1. ALLEGATION OF MISREPRESENTATIONS AND OMISSIONS IN VIOLATION OF 71 OKLA. STAT. § 408(A)(2).1110 2. ACTUAL FRAUD.1111 3. CONSTRUCTIVE FRAUD.1112 C. NO PRIVATE RIGHT OF ACTION UNDER SECTION 17(A) OF THE 1933 ACT.•..1113 D. SALE OF UNREGISTERED SECURITIES.1114 1. FAILURE TO PLEAD FACTS SUPPORTING A CLAIM THAT DEFENDANTS WERE NOT PROPERLY EXEMPT FROM REGISTRATION UNDER THE 1933 ACT OR OKLAHOMA LAW.:.1114 (A) FEDERAL SECURITIES CLAIMS BARRED BY THE ONE-YEAR STATUTE OF LIMITATIONS.1114 (B) STATE LAW CLAIMS PREEMPTED UNDER NMSIA.1115 E. FAILURE TO PLEAD SUFFICIENT FACTS TO SUPPORT A CLAIM FOR BREACH OF FIDUCIARY DUTY.1116 F. FAILURE TO PLEAD SUFFICIENT FACTS TO SUPPORT A CLAIM FOR NEGLIGENCE.1118 G. PLAINTIFFS’ CLAIMS HAVE ABATED DUE TO FAILURE TO PROPERLY SERVE DEFENDANTS, WITH THE EXCEPTION OF THE DYMAS FUND, L.P., WITHIN THE 120-DAY PERIOD REQUIRED BY FED. R. CIV. P. 4(M) .1120 H. PLAINTIFFS CANNOT STATE A CLAIM FOR CONTROL PERSON LIABILITY AGAINST ARTHUR STOCKTON BECAUSE THEY FAILED TO PROPERLY ALLEGE A VIOLATION OF SECURITIES LAWS BY ANY OF THE DEFENDANTS.1120 1. FEDERAL LAW SECURITIES VIOLATIONS UNDER THE 1934 ACT (SECTION 10(B)/RULE 10B-5) AND THE 1933 ACT FOR SALE OF UNREGISTERED SECURITIES.1120 (A) CONTROL PERSON LIABILITY UNDER THE 1934 ACT.1121 (B) CONTROL PERSON LIABILITY UNDER THE 1933 ACT.1121 2. STATE LAW SECURITIES VIOLATIONS FOR UNLAWFUL MISREPRESENTATIONS OR OMISSIONS AND THE SALE OF UNREGISTERED SECURITIES.1122 (A) STATE LAW VIOLATIONS FOR UNLAWFUL MISREPRESENTATIONS OR OMISSIONS.1122 (B) STATE LAW VIOLATIONS FOR THE SALE OF UNREGISTERED SECURITIES. ... 1123 VI. RECOMMENDATION. 1123 VII. OBJECTIONS.1123 RECOMMENDATION REGARDING DEFENDANTS’ MOTIONS TO DISMISS Now before the undersigned United States Magistrate Judge are several Motions to Dismiss filed by Defendants in the above-titled action. Defendants Capital Equity Resources Management Company, Inc. (“Capital Equity”) and Stockton Capital Management Securities, Inc. (“SCMSI”) filed Motions to Dismiss pursuant to Fed.R.Civ.P. 12(b)(2), asserting lack of personal jurisdiction in Oklahoma. [Doc. Nos. 25-1, 26-1]. Capital Equity and SCMSI additionally move to dismiss all claims against them pursuant to Fed. R.Civ.P. 12(b)(6), the Private Securities Litigation Reform Act (“PSLRA”), and Fed.R.Civ.P. 9(b). [Doc. Nos. 25-1, 26-1], Defendants The Dymas Fund, L.P. (“Dy-mas Fund”), Tactical Equity Analytics Management, Inc. (“TEAM”), . Stockton Trust, Inc. (“Stockton Trust”), and Arthur F. Stockton (“Stockton”), similarly move to dismiss all claims against them pursuant to Fed.R.Civ.P. 12(b)(6), the PSLRA, and Fed.R.Civ.P. 9(b). [Doc. Nos. 4-1, 27-1, 30-1]. Defendant Dymas Partners, L.P. (“Dymas Partners”) has been dismissed from this action without prejudice. [Doc. No. 49]. Plaintiffs have admitted that no such entity by the name Dymas Partners, L.P. exists. Defendants’ motions to dismiss were referred to the undersigned United States Magistrate Judge for Report and Recommendation. [Doc. No. 50]. The undersigned has reviewed the parties’ briefs and exhibits, relevant case law, and heard oral arguments on the motions to dismiss on April 11, 2003. Accordingly, the undersigned recommends that the District Court GRANT IN PART AND DENY IN PART Defendants’ Motions to Dismiss. [Doc. Nos. 4-1, 25-1, 26-1, 27-1, 30-1], Specifically, the undersigned has recommended that the District Court grant Defendants’ motions to dismiss all of Plaintiffs’ claims as against all Defendants, with the exception of the following: (1) Plaintiffs’ claim against Individual Defendant Arthur Stockton for breach of fiduciary duty/inappropriate investment advice; and (2) Plaintiffs’ claim against Defendant Arthur Stockton for negligence. Additionally, the ■undersigned has recommended that Plaintiffs’ claim for violation of federal securities law under the 1933 Act for the sale of unregistered securities be dismissed without prejudice, and leave granted to amend Plaintiffs’ Complaint, in order for Plaintiffs to set forth details of ongoing purchases and facts specifying what unregistered securities were bought or sold so as to fall within the applicable one-year statute of limitations. The undersigned also recommends that Plaintiffs’ claim of control person liability for violation of the 1933 Act in the sale of unregistered securities be dismissed without prejudice because Plaintiffs’ potential to amend their Complaint and set forth details bringing their claim within the one-year statutory period may impact the control person liability analysis. INTRODUCTION Plaintiffs Richard Lillard, individually and as trustee of the V.W. Lillard Trust, dated May 24, 1990, and Lucinda Lillard bring this action to recoup losses sustained after they pursued certain investments, including investment in a “hedge fund” known as The Dymas Fund Limited Partnership (“Dymas Fund”). In their Complaint filed September 10, 2001, Plaintiffs raise several causes of action, including: (1) Breach of Fiduciary Duty (inappropriate investment advice); (2) Sale of Unregistered Securities; (3) Securities Fraud under Section 10(b) of the Securities Exchange Act/Rule 10b-5 (alleged misrepresentations and omissions); (4) Alleged misrepresentations and omissions in violation of Section 17(a) of the Securities Act of 1933 (the “1933 Act”); (5) Violation of 71 Okla. Stat. § 408(A)(2); (6) Actual fraud, (7) Constructive fraud; and (8) Negligence. [Doc. No. 1, Complaint]. Plaintiffs complain that their investment in the Dymas Fund declined during the dramatic bear market that began in 2000. Plaintiffs initially served only the Dymas Fund. On February 11, 2002, five months after filing their Complaint, Plaintiffs served Defendants Stockton, Stockton Trust, TEAM, SCMSI, and Capital Equity. Defendants now move to dismiss Plaintiffs’ claims on the following grounds: (1) Lack of personal jurisdiction (Defendants Capital Equity and SCMSI); (2) Failure to plead fraud claims with particularity required under Rule 9(b) and the PSLRA; (3) No private right of action exists under Section 17(a) of the 1933 Act; (4) Failure to allege facts demonstrating that an offering of interests in the Dymas Fund should have been registered; or, in the alternative, Plaintiffs’ federal securities claims for the unlawful sale of unregistered securities are barred by the one-year statute of limitations, and Plaintiffs’ state law claims are preempted by the National Market Securities Improvement Act (“NMSIA”); (5) Failure to properly allege a violation of federal or state securities laws for either unlawful misrepresentations or omissions or for the sale of unregistered securities by any of the Defendants; thus precluding a claim for control-person liability against Arthur Stockton; (6) Insufficiency as a matter of law in Plaintiffs’ claims for breach of fiduciary duty and negligence; and (7) Failure to effect service upon Defendants, with the exception of the Dy-mas Fund, L.P., within the 120-day period required under Fed.R.Civ.P. 4(m); thus, Plaintiffs’ claims against those Defendants have abated. Defendants have incorporated by reference the briefs of the other Defendants in this action. Therefore, Defendants’ briefs will be analyzed in conjunction for purposes of this Report and Recommendation. I. BACKGROUND A. The Parties Plaintiff Richard Lillard brought this suit in his individual capacity and in his capacity as Trustee of the V.W. Lillard Trust, dated May 24, 1990. Mr. Lillard’s wife, Lucinda Lillard, is also a Plaintiff in this action. [Complaint at ¶¶ 1-3]. The Dymas Fund is a Nevada Limited Partnership with its principal place of business in Las Vegas, Nevada. [Complaint at ¶ 8]. The Dymas Fund’s stated objective, according to Defendants, was to provide a significant investment rate of return through aggressive trading in equity securities. TEAM is Dymas Fund’s corporate General Partner. Stockton Trust is an Arizona chartered trust company. SCMSI is an Arizona corporation and licensed broker dealer. Capital Equity is a Nevada corporation providing corporate accounting and payroll services. Arthur Stockton is the Chairman and President of Stockton Trust, SCMSI, and TEAM. B. Plaintiffs’ Introduction to Defendants Plaintiffs opened an investment account with Stockton Trust in 1995. Plaintiffs chose an “aggressive” stance on investment objectives for their investment profile. Plaintiffs signed Investment Policy Statements on June 15, 1995. [Doc. No. 4, Exhibit A, Investment Policy Statement, Aggressive Profile, June 15, 1995]. Plaintiffs updated their investment objectives in July 1998, once again selecting the category for “aggressive” investment strategy. [Doc. No. 4, Exhibit B, Investment Profile Questionnaire, July 27,1998]. In the same questionnaire, Richard Lillard wrote that, among the investment considerations in the Lillards’ portfolio, “safety of principal/income” should “never” be the main concern. Id. The Lillards signed another Investment Policy Statement on July 27, 1998, reaffirming their “Aggressive Profile” objective. [Doc. No. 4, Exhibit C]. C. Plaintiffs’ Investment into The Dymas Fund Plaintiffs signed a Subscription Agreement on May 30, 2000, directing that their investment be moved from Stockton Trust in Arizona to the Nevada-based Dymas Fund. In the agreement, Plaintiffs warranted that they were “accredited investors,” as defined in Regulation D in the 1933 Act; that they were qualified purchasers, defined by the Investment Company Act; and that they met all suitability standards imposed by applicable laws. [Doc. No. 4, Exhibit D, May 30, 2000 Subscription Agreement]. Plaintiffs were provided copies of a Confidential Private Offering Memorandum (“CPOM”) prior to signing the Subscription Agreement. The CPOM described the investment and risks involved in the Dymas Fund. [Doc. No. 4, Exhibit E], Plaintiffs warranted in their Subscription Agreement that they had received and read the CPOM. [Doc. No. 4, Exhibit D at 2]. In their Complaint, Plaintiffs admit receiving the CPOM. [Complaint at ¶ 34], The CPOM and the Subscription Agreement stated that the Dymas Fund was not registered under the Securities Act of 1933, and that interests in the Dymas Fund were being offered in reliance on federal and state registration exemptions for non-public offerings. The CPOM also described the investment strategy for the Dymas Fund, which included short-term and intermediate trading. [Doc. No. 4, Exhibit E, CPOM at 2, 8-10]. A bold-type warning in the description of the Dymas Fund’s objectives stated that the “investment program is speculative and entails substantial risks.” [Doc. No. 4, Exhibit E at 10]. A seven page recitation of “risk factors” followed the warning. Id. at 11-17. The CPOM further noted that neither the partnership nor the general partner had been registered under the Investment Company Act or the Investment Advisory Act. Id. at 36-37. Plaintiffs suffered significant losses in the value of their accounts in the 2000-2001 bear market. Plaintiffs claim they lost most of their life savings, in what they termed a “dubious investment scheme,” through the vehicle of the Dymas Fund. Plaintiffs were introduced to Arthur Stockton through the First National Bank of Miami, Oklahoma, which suggested that Plaintiffs contact Stockton for investment advice [Doc. No. 11]. Plaintiffs assert that Stockton convinced them to invest in a new “hedge-fund” he was creating after he gained their confidence and trust. Id. Plaintiffs further contend that, at all times relevant to this matter, they were not accredited investors and were unsophisticated and lacking in knowledge of business matters pertaining to the handling and investing of money and matters relating to stock market investments and unregistered securities. [Complaint at ¶¶ 12-13]. At the hearing, Plaintiffs’ counsel noted that Plaintiffs’ total investment was approximately $900,000.00, of which only about $100,000.00 remained upon closing the accounts. Plaintiffs contend that Defendants assured them that no security would be held beyond a ten percent (10%) drop in market price, and that preservation of capital was a primary objective. However, Plaintiffs nonetheless realized a substantial loss of value in their accounts in excess of ninety percent (90%). [Complaint at ¶ 23]. II. PLEADING STANDARDS APPLICABLE TO PLAINTIFFS’ CLAIMS A. Fed.R.Civ.P. 12(b)(6) In ruling on a motion to dismiss for failure to state a claim under Fed.R.Civ.P. 12(b)(6), the Court will assume as true all well-pleaded facts in Plaintiffs complaint, view them in a light most favorable to Plaintiff, and make all reasonable inferences in favor of Plaintiff. See Zinermon v. Burch, 494 U.S. 113, 118, 110 S.Ct. 975, 108 L.Ed.2d 100 (1990); Lafoy v. HMO Colorado, 988 F.2d 97, 98 (10th Cir.1993). “Dismissal is proper only if it appears beyond reasonable doubt that the plaintiff can prove within such allegations no set of facts in support of the claim which would entitle him to relief.” See Bryson v. City of Edmond, 905 F.2d 1386, 1390 (10th Cir.1990) (citing Shaw v. Valdez, 819 F.2d 965, 968 (10th Cir.1987)). It does not necessarily follow, however, that every assertion in the complaint must be taken as true. Rather, “[a] motion to dismiss under Rule 12(b) admits all well-pleaded facts in the complaint as distinguished from conelusory allegations.” See Mitchell v. King, 537 F.2d 385, 386 (10th Cir.1976). While, of the purposes of a motion to dismiss, facts well pleaded must be taken as true, unsupported conclusions of the pleader may be disregarded, especially when limited or negated by the substance of facts pleaded. Oppenheim v. Sterling, 368 F.2d 516, 519 (10th Cir.1966). When a complaint raises an arguable question of law which the district court ultimately finds is correctly resolved against the plaintiff, dismissal on Rule 12(b)(6) grounds is appropriate.... Dunn v. White, 880 F.2d 1188, 1190 (10th Cir.1989) (citations omitted). A Court must examine whether the factual allegations state a valid claim upon which relief can be granted. See Oppenheim, 368 F.2d at 519. In the context of securities litigation, the Tenth Circuit has warned that dismissal is “difficult to obtain” due to the fact-sensitive nature of the relevant issues .... Dismissal is appropriate, however, “where the alleged misstatements or omissions are plainly immaterial,” or where the plaintiff has failed to satisfy established pleading requirements. See In re Sprint Corp. Securities Litigation, 232 F.Supp.2d 1193, 1213 (D.Kan.2002) (citing Grossman v. Novell, Inc., 120 F.3d 1112, 1118 (10th Cir.1997)) (citations omitted). B. Fed.R.Civ.P. 9(b) All claims alleging fraud must be pled with particularity pursuant to Fed.R.Civ.P. 9(b). It follows, therefore, that claims alleging a violation of Section 10(b) of the 1934 Act and SEC Rule 10b-5 must also be pled with particularity because they are based in fraud. See Seattle-First Nat’l Bank v. Carlstedt, 800 F.2d 1008, 1010 (10th Cir.1986) (the particularity requirement of Rule 9(b) is applicable in securities fraud cases); Schwartz v. Celestial Seasonings, Inc., 124 F.3d 1246, 1252 (10th Cir.1997); Farlow v. Peat, Marwick, Mitchell & Co., 956 F.2d 982, 987 (10th Cir.1992). Rule 9(b) requires a complaint to “set forth the time, place and contents of the false representation, the identity of the party making the false statements and the consequences thereof.” See Schwartz, 124 F.3d at 1252 (citing Lawrence Nat’l Bank v. Edmonds, 924 F.2d 176, 180 (10th Cir.1991)). Similarly, where fraud is alleged against multiple defendants, blanket allegations of fraud couched in language such as “by the defendants” are insufficient. Instead, the specifics of the alleged fraudulent activity of each defendant must be set forth. See Bruns v. Ledbetter, 583 F.Supp. 1050, 1052 (S.D.Cal.1984). C. The Private Securities Litigation Reform Act (“PSLRA”) The PSLRA was enacted by Congress in 1995 to deter plaintiffs from filing abusive securities frauds claims, in part by elevating the pleading standards for securities fraud. Philadelphia v. Fleming Cos., 264 F.3d 1245, 1258 (10th Cir.2001). The PSLRA mandates particular detail regarding allegedly fraudulent statements and omissions: In any private action arising under this chapter in which the plaintiff alleges that the defendant (A) made an untrue statement of a material fact; or (B) omitted to state a material fact necessary in order to make the statements made, in the light of the circumstances in which they were made, not misleading; the complaint shall specify each statement alleged to have been misleading, the reason or reasons why the statement is misleading, and, if an allegation regarding the statement or omissions is made on information and belief, the complaint shall state with particularity all facts on which that belief is formed. See 15 U.S.C. § 78u-4(b). In addition, the PSLRA requires a plaintiff to set forth particular facts supporting allegations that a defendant acted with a particular state of mind. In any private action arising under this chapter in which the plaintiff may recover money damages only on proof that the defendant acted with a particular state of mind, the 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) (emphasis added). Any complaint failing to conform with the pleading requirements of the PSLRA “shall” be dismissed. See 15 U.S.C. § 78u-4(b)(3)(A). III. PERSONAL JURISDICTION ANALYSIS The undersigned will first analyze the motions to dismiss by Defendants Capital Equity and SCMSI, which seek dismissal of Plaintiffs’ claims against them pursuant to Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction. [Doc. Nos. 25-1, 26-1]. A. Standards For Evaluating Personal Jurisdiction The United States Supreme Court has held that individuals have a liberty interest, protected by the due process clause, in not being subject to the binding judgments of a forum with which the individual has established no meaningful contacts, ties, or relations. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). In order to be subject to the Court’s jurisdiction, not only must the due process clause be satisfied, but the law of the forum state must also authorize the exercise of jurisdiction under the circumstances. Thus, the test for exercising long-arm jurisdiction over a nonresident of the forum is to determine first whether the exercise of jurisdiction is authorized by a forum statute and, if so, whether such exercise of jurisdiction would be consistent with the constitutional requirements of due process. In Oklahoma, however, this two-part inquiry collapses into a single due process analysis because the current Oklahoma long-arm statute provides that an Oklahoma court “may exercise jurisdiction on any basis consistent with the Constitution of this state and the Constitution of the United States.” See 12 Okla. Stat. § 2004(F); see also Rambo v. American Southern Ins. Co., 839 F.2d 1415, 1416-17 (10th Cir.1988) (establishing the personal jurisdiction inquiry under Oklahoma law). A federal court may, consistent with the due process clause of the Constitution, exercise personal jurisdiction over a nonresident defendant so long as minimum contacts exist between the defendant and the forum state. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)). The defendant’s contacts with the forum state must be such that maintenance of the suit does not offend traditional notions of fair play and substantial justice. Id. at 292, 100 S.Ct. 559. The sufficiency of a defendant’s contacts must be evaluated by examining the defendant’s conduct and connections with the forum state to assess whether the defendant has purposefully availed itself of the privilege of conducting activities within the forum state, and the plaintiffs claims arise out of those activities. See Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); Kuenzle v. HTM Sport-Und Freizeitgerate AG, 102 F.3d 453, 456 (10th Cir.1996) (“The contacts must reflect purposeful availment and the cause of action must arise out of those contacts.”). See generally, Rambo, 839 F.2d at 1417 (reiterating this general test for personal jurisdiction). The “minimum contacts” test protects a defendant, who has no meaningful' contact with a state, from the burdens of defending a lawsuit in a forum, where the substantive and procedural laws may be quite different from those with which the litigant is familiar. Moreover, “it acts to ensure that the States, through.their courts, do not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system.” Woodson, 444 U.S. at 291, 100 S.Ct. 559. Jurisdiction over corporations may be either general or specific. If a defendant has purposefully directed its activities at residents of the forum, and the injuries alleged arise out of or relate to those activities, a court may, consistent with the due process clause, exercise “specific” jurisdiction over the defendant. In contrast, when the suit does not arise from or relate to the defendant’s contacts with the forum, a court may exercise “general” jurisdiction over the defendant based on the defendant’s presence in or accumulated contacts with the forum. Rudzewicz, 471 U.S. at 473 n. 15, 105 S.Ct. 2174; Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 nn. 8 & 9, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). However, because general jurisdiction is not related to the events giving rise to the suit, courts impose a more stringent minimum contacts test, requiring the plaintiff to demonstrate the defendant’s “continuous and systematic general business contacts.” Helicopteros, 466 U.S. at 416, 104 S.Ct. 1868. See generally, OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1090-91 (10th Cir.1998); Rambo, 839 F.2d at 1418. Thus, to establish general jurisdiction, the defendant must be conducting substantial and continuous local activity within the forum state. Soma Medical Int’l v. Standard Chartered Bank, 196 F.3d 1292, 1295 (10th Cir.1999). B. Analysis Both Defendant Capital Equity and Defendant SCMSI argue they are not subject to personal jurisdiction in the state of Oklahoma. , Accordingly, the contacts of each Defendant with Oklahoma must be evaluated to determine if the due process clause warrants exercise of jurisdiction over them. 1. Defendant Capital Equity’s Contacts with Oklahoma Capital Equity is a Nevada corporation, its principal place of business in Las Vegas, Nevada. [Doc. No. 25, Exhibit A, Stockton affidavit at ¶ 7]. Capital Equity is a payroll, bookkeeping, and leasing services company. It leases equipment, facilities, and services to small businesses. Arthur Stockton is the President of Capital Equity. [Doc. No. 25, Exhibit A, Stockton affidavit at ¶ 2]. Capital Equity confines its business to the states of Arizona and Nevada. Capital Equity was listed as a potential affiliate service provider to the Dymas Fund in the CPOM on the contingency that Capital Equity might provide payroll, bookkeeping, or leasing services to the Dymas Fund. However, no such services were provided by Capital Equity to the Dymas Fund. Capital Equity maintains no offices or employees within Oklahoma, nor does it pay taxes in Oklahoma, visit customers in Oklahoma, advertise or solicit business, maintain fax or phone listings, or conduct any business within the state of Oklahoma. Defendant Capital Equity contends that it had no dealings with the Dymas Fund or its general partner, TEAM. Capital Equity had no dealings or communications with the Lillards. [Doc. No. 25, Exhibit A, Stockton affidavit at ¶ 7]. Finally, Arthur Stockton attests to the fact that any actions he may have taken in connection with Plaintiffs’ investments were not performed in his capacity as President of Capital Equity. Id. at ¶ 8. Plaintiffs contend Capital Equity has purposefully directed numerous activities toward the state of Oklahoma, asserting that “[Capital Equity and SCMSI], along with the other defendants, bound themselves together under the direction and control of Stockton in a common enterprise aimed at bringing them investment dollars from Oklahoma from which they could derive a profit.” [Doc. No. 40 at 16]. Plaintiffs argue that Oklahoma’s jurisdiction over Capital Equity is justified based on the notion that a “common enterprise” existed, furthered by Arthur Stockton’s contacts with Plaintiffs, which caused harm to Plaintiffs. 2.Defendant SCMSI’s Contacts with Oklahoma SCMSI is an Arizona corporation, its principal place of business in Phoenix, Arizona. SCMSI does not maintain offices or employees in the state of Oklahoma, nor does it pay taxes in Oklahoma, advertise or solicit business in Oklahoma, maintain phone or fax listings in Oklahoma, or conduct regular business in Oklahoma.' [Doc. No. 26, Exhibit A, Stockton affidavit at ¶ 3]. Arthur Stockton is the President of SCMSI. Id. at ¶ 2. Defendant SCMSI contends that it did not maintain any trading accounts with Plaintiffs, did not have any contacts or agreements with Plaintiffs, did not sell any securities to Plaintiffs, and had “no dealings whatsoever” with Plaintiffs in connection with their investment in the Dymas Fund or any other investment. Id. at ¶ 4. SCMSI asserts that its sole function is to execute unsolicited, institutional block trades for one client — Stockton Trust, Inc. Id. SCMSI was listed in the Dymas Fund CPOM as a potential future affiliate service provider on the contingency it might provide service directly to the Dymas Fund. No such services were ever provided. Id. at ¶ 5. Defendants further assert the Dymas Fund listed the potential services of SCMSI because SCMSI provided institutional trading services to Stockton Trust, Inc. and, though twice removed, the Dymas Fund believed it important to disclose the potential conflict of interest. “However, to the extent any transactions by Stockton Trust, Inc. represented transactions for the Dymas Fund, they formed part of the large, institutional block trades for Stockton Trust, Inc., indistinguishable from any others.” Id. at ¶ 6. Finally, Arthur Stockton declares that any -of the actions he may have undertaken in connection with Plaintiffs’ investments were not performed in his capacity as President of SCMSI. Id. at ¶ 6. Plaintiffs again argue that SCMSI is part of an “inextricably intertwined” common enterprise with all other Defendants, the actions of which ultimately caused harm to Plaintiffs. Plaintiffs contend that SCMSI’s involvement as one of the “Stockton entities” justifies this Court’s exercise of jurisdiction over SCMSI. Both Defendants argue that the above-listed contacts are insufficient under the due process clause of the United States Constitution to subject- them to this Court’s jurisdiction. (A) General Personal Jurisdiction For a court to assert general jurisdiction over a nohresident defendant, the plaintiff must demonstrate the defendant has continuous and systematic contacts with the forum state. In Soma, the Tenth Circuit found the following factors helpful in determining whether general personal jurisdiction exists as to a non-resident corporation: Whether the corporate defendant is: 1. engaged in business in this state; 2. licensed to do business in this state; 3. owning, leasing, or controlling property (real or personal) or assets in this state; 4. maintaining employees, offices, agents, or bank accounts in this state; 5. present in that shareholders reside in this state; 6. maintaining phone or fax listings within this state; 7. advertising or soliciting business in this state; 8. traveling to this state by way of salespersons, etc.; 9. paying taxes in this state; 10. visiting potential customers in this state; 11. recruiting employees in the state; 12. generating a substantial percentage of its national sales through revenue generated from in-state customers. Soma, 196 F.3d at 1295-96. None of the above criteria are satisfied to enable the Court’s exercise of general personal jurisdiction over Defendant Capital Equity or Defendant SCMSI. The only factor 'potentially weighing in favor of Plaintiffs’ argument would be the unsubstantiated allegation that Defendants engaged in business in Oklahoma or solicited customers under the guise of a common enterprise through Arthur Stockton. However, Plaintiffs’ general, conelusory allegations of such activities is insufficient to justify the exercise of general personal jurisdiction over Capital Equity or SCMSI. See Mitchell v. King, 537 F.2d 385, 386 (10th Cir.1976); see also Oppenheim v. Sterling, 368 F.2d 516, 519 (10th Cir.1966). Plaintiffs provide no proof to validate their claims, which are contradicted by the sworn affidavit of Arthur Stockton. Similarly, even if Defendants solicited Plaintiffs’ via the so-called “Stockton entities,” general jurisdiction would still be improper because Defendants solicited only two residents. This conduct does not justify subjecting Defendants to general personal jurisdiction where Defendants’ activities do not demonstrate continuous and systematic contacts with Oklahoma. (B) Specific Personal Jurisdiction Although general personal jurisdiction over Defendants is not applicable, the Court may still exercise specific personal jurisdiction consistent with the due process clause if Defendants have purposefully directed their activities at residents of the forum, and the injuries alleged arise out of or relate to those activities. To exercise specific personal jurisdiction, a defendant’s activities directed toward residents in a forum state must be such that the defendant can reasonably anticipate being haled into court in the forum state. The Supreme Court, in Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958), reasoned: The application of that rule will vary with the quality and nature of the defendant’s activity, but it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws. Id. at 253, 78 S.Ct. 1228 (citing Int’l Shoe Co., 326 U.S. at 319, 66 S.Ct. 154). A plaintiff bears the burden of demonstrating that jurisdiction exists over a non-resident defendant. See Kuenzle, 102 F.3d at 456. Jurisdiction will not be avoided merely because the defendant never physically entered the forum state. Burger King Corp., 471 U.S. at 476, 105 S.Ct. 2174. The need for physical presence is obviated by the “inescapable fact of modern commercial life that a substantial amount of business is transacted solely by mail and wire communications across state fines....” Id. at 476, 105 S.Ct. 2174. Also relevant is whether any nexus exists between Defendant’s alleged forum-related contacts and the cause of action against Defendant. See OMI Holdings, 149 F.3d at 1095 (recognizing that for specific jurisdiction to exist, there must be a nexus “between Defendant’s forum-related contacts and the Plaintiffs cause of action”). (1) Specific Jurisdiction over Capital Equity The undersigned finds that Plaintiffs have failed to demonstrate that the Northern District of Oklahoma can exercise specific jurisdiction over Defendant Capital Equity. Plaintiffs’ bald and unsupported allegations do not persuade the undersigned that Capital Equity has purposefully directed activities toward Plaintiffs, as residents of Oklahoma, such that Capital Equity could reasonably anticipate being haled into court in Oklahoma. For purposes of establishing jurisdiction, “[o]nly the well pled facts of [the] complaint, as distinguished from mere conclusory allegations, must be accepted as true.” See Ten Mile Indus., Park v. Western Plains Serv. Corp., 810 F.2d 1518, 1524 (10th Cir.1987). Plaintiffs’ attempt to manufacture personal jurisdiction through conclusory allegations that Capital Equity bound itself together “under the direction and control of Stockton in a common enterprise aimed at bringing [Defendants] investment dollars from Oklahoma .... ” and, through the acts of Arthur Stockton, “purposefully directed numerous actions” within Oklahoma causing harm to the Plaintiffs is insufficient to establish jurisdiction. [Doc. No. 40 at 16]. Plaintiffs fail to identify or allege any “actions” that Capital Equity “purposefully directed” toward or within Oklahoma. Capital Equity notes that its name specifically appears only three times in Plaintiffs’ Complaint, and never in connection with any alleged conduct directed at or occurring within Oklahoma. Moreover, even well pled allegations in a Complaint are not automatically assumed to be true when contradicted by the affidavits from the opposing party. See FDIC v. Oaklawn Apts., 959 F.2d 170, 174 (10th Cir.1992) (“well pled facts of the complaint must [only] be accepted as true if uncontroverted by the defendant’s affidavits”); see also Data Disc, Inc. v. Systems Tech. Assoc., Inc., 557 F.2d 1280, 1284 (9th Cir.1977) (“we may not assume the truth of allegations in a pleading which are contradicted by affidavit.”). Plaintiffs’ “common enterprise” allegations are contradicted by the affidavit of Arthur Stockton, which stated that Capital Equity had nothing to do with the Dymas Fund or with TEAM, and had “no dealings or communications of any kind” with the Lillards. [Doc. No. 25, Exhibit A, at ¶ 7], Additionally, Stockton declared that “none of the actions [he] may have undertaken in connection with investments by Richard and Lucinda Lillard, were performed in [his] capacity as President of Capital Equity.” Id. at ¶ 8. Finally, Plaintiffs’ attempt to establish jurisdiction over Capital Equity in this Court by noting that Capital Equity is a plaintiff in an indemnity action filed against the Lillards in Nevada as evidence of a relationship between Capital Equity and the Lillards is unpersuasive. [Doc. No. 40 at 16]. Capital Equity contends that it filed suit against the Lillards solely as a third-party beneficiary of a contract between the Lillards and TEAM, in which the Lillards agreed to indemnify TEAM, the Dymas Fund and their “affiliates” (including Capital Equity) in the event that plaintiffs made false representations or warranties in the Subscription Agreement for the Dymas Fund. [Doc. No. 44 at 5 n. 1]. The undersigned agrees that Plaintiffs’ argument is a red herring which fails to assist in the determination of the extent of Defendant Capital Equity’s purposefully directed activities toward Oklahoma. For the reasons discussed above, the undersigned finds that Defendant Capital Equity is not subject to specific personal jurisdiction in the forum state of Oklahoma. Because the undersigned concludes that Defendant Capital Equity has not purposefully established minimum contacts in Oklahoma, an analysis of the contacts in light of various factors to determine if the exercise of specific personal jurisdiction comports with traditional notions of fair play and substantial justice need not be undertaken. (2) Specific Jurisdiction over SCMSI The undersigned further finds that Plaintiffs have failed to satisfy their burden of establishing specific personal jurisdiction over Defendant SCMSI, a non-resident corporation, for many of the reasons set forth in the Capital Equity analysis. First, Plaintiffs’ conclusory allegations that SCMSI comprised part of a “common enterprise” causing harm to Plaintiffs is unsupported in factual allegations or affidavits and, in fact, contradicted by the affidavit of Arthur Stockton. As previously discussed, SCMSI is an Arizona corporation, its principal place of business in Phoenix, Arizona, which executes large, unsolicited block trades on behalf of its only client Stockton Trust. [Doc. 26, Exhibit A, at ¶¶ 3-^4]. Moreover, Arthur Stockton declared that none of the actions taken in connection with the Lillards’ investments were performed in his capacity as President of SCMSI. Id. at ¶ 6. Second, Plaintiffs fail to identify acts that Defendant SCMSI purposefully directed toward them as Oklahoma residents or conduct on the part of SCMSI giving rise to Plaintiffs’ claims. SCMSI was listed in the CPOM for the Dymas Fund as a potential affiliate service provider, whose services were never utilized. SCMSI was also listed to disclose any potential conflict of interest in light of the institutional trading services it provided to Stockton Trust. Id. at ¶ 5. SCMSI did not maintain any individual investors accounts. Id. at ¶ 4. Third, for substantially the same reasons discussed in the Capital Equity analysis, the fact that Defendant SCMSI has filed suit against Plaintiffs in Arizona as a third-party beneficiary of a contract between Plaintiffs and TEAM wherein Plaintiffs agreed to indemnify TEAM, the Dy-mas Fund, and their “affiliates” in the event Plaintiffs made false representations or warranties in the Dymas Fund Subscription Agreement is not, in itself, sufficient to establish a relationship between SCMSI and Plaintiffs. Thus, the concluso-ry and controverted allegations proffered by Plaintiffs in an attempt to justify this Court’s exercise of specific personal jurisdiction over Defendant SCMSI are unpersuasive because they fail to establish how SCMSI, through its conduct, purposefully availed itself to the privilege of doing business in Oklahoma or engaged in actions giving rise to Plaintiffs’ claims. The undersigned finds that Plaintiffs have failed to .satisfy their burden that Defendant SCMSI is subject to specific personal jurisdiction in the Northern District of Oklahoma. Accordingly, the reasonableness and traditional notions of fair play and substantial justice analysis in exercising specific jurisdiction over Defendant SCMSI need not be conducted. For the reasons set forth above, the undersigned recommends that the District Court GRANT Defendant Capital Equity and Defendant SCMSI’s Motions to Dismiss for lack of personal jurisdiction pursuant to Fed.R.Civ.P. 12(b)(2). [Doc. Nos. 25-1, 26-1]. However, due to the nature of this Report and Recommendation, and if the District Court should choose not to adopt the undersigned’s recommendation, Defendants Capital Equity and SCMSI will be included as part of the undersigned’s analysis of the remaining Defendants’ motions to dismiss on other disposi-tive grounds. IV. OTHER DISPOSITIVE ISSUES A. Failure to State a Claim under the 1934 Act for Unlawful Misrepresentations or Omissions in Violation of Section 10(b)/Rule 10b-5 1. Overview Under Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), any person is prohibited from using or employing a “manipulative or deceptive device” in connection with the sale of a security. More specifically, Section 10(b) of the 1934 Act provides as follows: It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce or of the mails, or of any facility of any national securities exchange- To use or employ, in connection with the purchase or sale of any security ..., any manipulative or deceptive device or contrivance in contravention of such rules and regulations as the [Securities and Exchange] Commission may prescribe as necessary or appropriate in the public interest or for the protection of investors. 15 U.S.C. § 78j(b) (hereinafter “ § 10(b) of the 1934 Act” or “ § 10(b)”). Pursuant to the authority vested in it by § 10(b) of the 1934 Act, the Securities and Exchange Commission (“SEC”) has promulgated Rule 10b-5, which provides as follows: It shall be unlawful for any person, directly or indirectly, by the use of any means or instrumentality of interstate commerce, or of the mails or of any facility of any national securities exchange, (a) To employ any device, scheme, or artifice to defraud, (b) To make any untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading, or (c)To engage in any act, practice, or course of business which operates or would operate as a fraud or deceit upon any person, in connection with the purchase or sale of any security. 17 C.F.R. § 240.10b-5 (hereinafter “SEC Rule 10b-5” or “Rule 10b-5”). Elements — A plaintiff must plead and prove the following elements to recover under § 10(b) of the 1934 Act and SEC Rule 10b-5: (1) That the defendant made an untrue statement of material fact, or failed to state a material fact; (2) That the conduct occurred in connection with the purchase or sale of a security; (3) That the defendant made the statement or omission with scienter (i.e., knowingly or recklessly); and (4) That the plaintiff justifiably relied on the misrepresentation or omission and sustained damages as a proximate result of the misrepresentation or omission. Anixter v. Home-Stake Production Co., 77 F.3d 1215, 1225 (10th Cir.1996); United Int’l Holdings, Inc. v. The Wharf (Holdings) Ltd., 210 F.3d 1207, 1220 (10th Cir.2000). Plaintiffs allege that eleven (11) misrepresentations and material omissions were made by Defendants in violation of § 10(b) and Rule 10b-5. [Complaint at Count III, ¶¶ 35-37]. Defendants assert that Plaintiffs fail to identify with specificity which Defendant made the alleged misrepresentation or omission, and cite the following reasons supporting their contention that Plaintiffs’ allegations are insufficient to state a cause of action under § 10(b) and Rule 10b-5: (1) Plaintiffs fail to meet the pleading standards under Fed.R.Civ.P. 9(b) and the PSLRA; (2) Plaintiffs have failed to plead facts demonstrating that Defendants acted with the requisite state of mind (scienter); and (3) Plaintiffs fail to allege loss causation. 2. Failure to Satisfy Fed.R.Civ.P. 9(b) Standards: Failure to Plead Fraud with Particularity under Rule 9(b) and the PSLRA All claims alleging fraud must be pled with particularity pursuant to Fed.R.Civ.P. 9(b). It follows, therefore, that claims alleging a violation of Section 10(b) of the 1934 Act and SEC Rule 10b-5 must also be pled with particularity because they are based in fraud. See Seattle-First Nat’l Bank v. Carlstedt, 800 F.2d 1008, 1010 (10th Cir.1986) (the particularity requirement of Rule 9(b) is applicable in securities fraud cases); Schwartz v. Celestial Seasonings, Inc., 124 F.3d 1246, 1252 (10th Cir.1997); Farlow v. Peat, Marwick, Mitchell & Co., 956 F.2d 982, 987 (10th Cir.1992). Rule 9(b) requires a complaint to “set forth the time, place and contents of the false representation, the identity of the party making the false statements and the consequences thereof.” See Schwartz, 124 F.3d at 1252 (citing Lawrence Nat’l Bank v. Edmonds, 924 F.2d 176, 180 (10th Cir.1991)). Similarly, where fraud is alleged against multiple defendants, blanket allegations of fraud couched in language such as “by the defendants” are insufficient. Instead, the specifics of the alleged fraudulent activity of each defendant must be set forth. See Bruns v. Ledbetter, 583 F.Supp. 1050, 1052 (S.D.Cal.1984). Congress reinforced Rule 9(b)’s pleading requirements with the 1995 enactment of the Private Securities Litigation Reform Act (“PSLRA”). The PSLRA is designed to curb perceived abuses of federal securities litigation. See In re Sprint Corp. Securities Litigation, 232 F.Supp.2d 1193, 1213-14 (D.Kan.2002) (citing Philadelphia v. Fleming Cos., 264 F.3d 1245, 1258 (10th Cir.2001)). “The PSLRA thus mandates a more stringent pleading standard for securities fraud actions in general, and for scienter allegations in particular.” Id. In terms of allegations of material misrepresentations and omissions, the PSLRA requires: In any private action arising under this chapter in which the plaintiff alleges that the defendant- (A) made an untrue statement of a material fact; or (B) omitted to state a material fact necessary in order to make the statements made, in the light of the circumstances in which they were made, not misleading; the complaint shall specify each statement alleged to have been misleading, the reason or reasons why the statement is misleading, and, if an allegation regarding the statement or omissions is made on information and belief, the complaint shall state with particularity all facts on which that belief is formed. See 15 U.S.C. § 78u-4(b) (emphasis added). Defendants assert that Plaintiffs have failed to satisfy the pleading requirements under Rule 9(b) and the PSLRA in their failure to plead the alleged misrepresentations and omissions with particularity. Defendants discuss each of Plaintiffs’ allegations in turn, citing deficiencies in particularity of Plaintiffs’ allegations, which Plaintiffs submit were responsible for fraudulently inducing them to invest in the securities. Defendants also highlight the cautionary disclosures provided to Plaintiffs in the CPOM and Subscription Agreement. (i) Failure to disclose information regarding fees to be charged [sic] The Dymas Fund by Stockton affiliates [Complaint at Count III ¶ 35(a) ] Plaintiffs’ first allegation of unlawful misrepresentations or omissions centers on the fees to be charged the Dymas Fund by “Stockton affiliates.” Defendants note that Plaintiffs fail to identify what information concerning the fees was not provided. Moreover, Plaintiffs do not relate how the unidentified information is material to their cause of action under § 10(b)/Rule 10b-5. Plaintiffs fail to specify which of the Defendants omitted information on fees to be charged. It is unclear who the so-called “Stockton affiliates” encompasses. The undersigned agrees that this conclusory allegation by Plaintiffs fails to satisfy the heightened pleading requirement of particularity under Rule 9(b) and the PSLRA. Not only does it fail to “set forth the time, place and contents of the false representation, the identity of the party making the false statements and the consequences thereof,” but it also couches the alleged fraud in blanket allegations insufficient under Rule 9(b). See Schwartz, 124 F.3d at 1252 (citing Lawrence Nat’l Bank v. Edmonds, 924 F.2d 176, 180 (10th Cir.1991)); see also Bruns, 583 F.Supp. at 1052 (noting that the specifics of the alleged fraudulent activity of each defendant must be set forth). To further discount Plaintiffs’ allegation of unlawful misrepresentations or omissions, Defendants point to the disclosures provided in the CPOM and Subscription Agreement regarding administrative fees to be charged to the Dymas Fund and by whom. [Doc. No. 4, CPOM, Exhibit E at 5-6, 21-22; Partnership Agreement, Exhibit F at 6-7]. The CPOM notes that TEAM, the general partner, was entitled to a share of profits according to the formula detailed in the Dymas Fund Partnership Agreement. [Doc. No. 4, CPOM, Exhibit E at 4, 21-22, 26; Partnership Agreement, Exhibit F at 11 — 17]. Based on Plaintiffs’ failure to allege a misleading material statement or omission concerning fees to be charged to the Dy-mas Fund with particularity, and Defendants’ citation to ■ several disclosures in materials provided to Plaintiffs, the undersigned finds that Plaintiffs’ first allegation fails to satisfy the pleading standard of particularity under Rule 9(b) and the PSLRA and recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(a) of the Complaint. (ii) Failure to provide information regarding administrative fees and costs [Complaint at ¶ 35(b) ] Plaintiffs’ second, allegation involves false and misleading statements or omissions concerning information on administrative costs and fees. The undersigned finds that this general, conclusory allegation is insufficient under Rule 9(b)’s particularity requirement in that it too fails to specify the time, place and contents of the false representation, the identity of the party making the false statements, and the consequences thereof. See Schwartz, 124 F.3d at 1252 (citing Lawrence Nat’l Bank, 924 F.2d at 180); see also Bruns, 583 F.Supp. at 1052. First, this allegation fails to identify what “information” was lacking. Second, Plaintiffs do not distinguish among the Defendants in terms of which, if any, withheld or failed to provide this information. Third, no date as to the alleged omission is specified. Finally, Plaintiffs fail to identify how this omission is material or misleading. Defendants again cite to the disclosures in the CPOM and the Partnership Agreement, which provide information on administrative fees and costs. [Doc. No. 4, CPOM, Exhibit E at 5-6, 21-22; Partnership Agreement, Exhibit F at 6-7]. Therefore, the undersigned finds that this conclusory allegation is insufficient under Rule 9(b) and the PSLRA and recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(b). (iii)Failure to disclose material information regarding the general partner, TEAM, including its financial status, extent of capitalization, and capital contributions to The Dymas Fund [Complaint at ¶ 35(c) ] Plaintiffs’ third allegation of a material omission focuses on Defendants’ failure to disclose “material information” concerning TEAM, the general partner of the Dymas Fund. However, Plaintiffs’ fail to specify with particularity what information regarding TEAM and its financial status was not provided. Moreover, Plaintiffs fail to discuss why this information was material or the consequences of this omission. Again, Plaintiffs omit to distinguish among or specify which of the Defendants is responsible for this material omission, or when the omission occurred in relation to the transaction. Finally, Defendants point out that this information was provided to Plaintiffs in the CPOM and Partnership Agreement, documents which Plaintiffs signed after reviewing them. [Doc. No. 4, CPOM, Exhibit E at 2, 11, 15, 18-20; Partnership Agreement, Exhibit F at 4-6]. The undersigned finds that Plaintiffs have failed to plead this allegation with the particularity envisioned in and required by Rule 9(b) and the PSLRA, and recommends that the District Court GRANT Defendants’ motions to dismiss the allegation in Count III ¶ 35(c). (iv) Failure to disclose material information regarding the ownership, control, and management of the general partner, TEAM, the Dy-mas Fund, L.P., Stockton Trust, Inc., Stockton Capital Management Securities, Inc., Capital Equity Resources Management Company, Inc., and Dymas Partners, L.P. [Complaint at ¶ 35(d) ] Plaintiffs’ fourth allegation fails to satisfy the heightened pleading standard under Rule 9(b) and the PSLRA for substantially the same reasons discussed above. Plaintiffs do not identify what information was not disclosed by Defendants, when and where the non-disclosure occurred, or even how the information omitted was material. Defendants cite the CPOM as evidence that this information was revealed and detailed the involvement of TEAM, Capital Equity, SCMSI, Stockton Trust, and Stockton in relation to the Dymas Fund. [Doc. No. 4, CPOM, Exhibit E at 5, 11, 15, 18-20]. Accordingly, the undersigned finds that this allegation is insufficient under the pleading requirements and recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(d). (v) Failure to disclose an intent to invest in unregistered securities, namely Dymas Partners, L.P. [Complaint at ¶ 35(e) ] Plaintiffs’ fifth allegation involves a failure to disclose an intent on the part of Defendants to invest in unregistered securities, namely Dymas Partners, L.P. It is worth noting that Plaintiffs later admit that no such entity by the name of “Dymas Partners, L.P.” exists. Regardless, Plaintiffs’ allegation again falls short of the particularity and specificity required under Rule 9(b) and the PSLRA. No information is alleged as to who failed to disclose this information, when the non-disclosure occurred, or even why such an omission is material. Moreover, the CPOM and Subscription Agreement disclosed that the limited partnership interests in the Dymas Fund that Plaintiffs purchased were not registered. Defendants note that Plaintiffs represented in the Subscription Agreement their knowledge that the Dy-mas Fund was unregistered and that Plaintiffs were “accredited investors,” which imputes actual or constructive knowledge to the Plaintiffs. [Doc. No. 4, Subscription Agreement, Exhibit D at 2-4]. The undersigned finds that Plaintiffs’ fifth allegation lacks the sufficiency required under the pleading requirements, and recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(e). (vi) Failure to disclose intent to invest in securities of entities related to or affiliated with the general partner and controlling persons [Complaint at ¶ 35(f) ] Plaintiffs’ sixth allegation of a material omission fails to state with particularity which of the Defendants failed to disclose an intent to invest in securities of entities related to or affiliated with the general partner and controlling persons. No information as to the time or place of the omission is alleged; nor do Plaintiffs state why or how this information is material. Defendants note that Plaintiffs fail to identify which securities they are referring to in this allegation. Moreover, Defendants cite the CPOM as evidence of full disclosure of the relationship between the Dy-mas Fund, TEAM, and Stockton trust. [Doc. No. 4, CPOM, Exhibit E at 2,11,18-22], The undersigned finds that this general and conclusory allegation falls short of satisfying the pleading standard under Rule 9(b) and the PSLRA, and recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III 1135(f). (vii) Failure to disclose the investment structure with relation to limited partnership interests [Complaint at ¶ 35(g) ] Plaintiffs’ seventh allegation of non-disclosure lacks specificity as to which facts concerning the investment structure were not provided by Defendants, which of the Defendants failed to provide the information, and when, where, and how it is material. The CPOM and the Partnership Agreement disclose the investment into the Dymas Fund and its structure. [Doc. No. 4, CPOM, Exhibit E; Partnership Agreement, Exhibit F], Accordingly, the undersigned recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ vague allegation in Count III ¶ 35(g). (viii) Failure to disclose the true investing track record of key management personnel, namely Defendant Arthur Stockton [Complaint at ¶ 35(h) ] Plaintiffs’ eighth allegation lacks particularity as to the meaning of “true investing track record” and what information Defendants failed to provide. Again, no distinction is made in terms of which Defendant made such an omission or why this omission is material. The date and place of the omission are not alleged by Plaintiffs. Therefore, the undersigned recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(h). (ix) Misrepresentations of projected returns [Complaint at f 35(i) ] Plaintiffs’ ninth allegation focuses on “misrepresentations of projected returns.” This vague and conclusory allegation fails to plead with particularity the content of the alleged misrepresentations and the time and place they occurred. Such a broad and ambiguous allegation cannot satisfy Rule 9(b)’s particularity requirement or the PSLRA. Therefore, the undersigned recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(i). (x) Misrepresentations of investment strategies and objectives [Complaint at ¶ 350") Í Plaintiffs’ tenth allegation fails to satisfy .the pleading standards for substantially the same reasons discussed above. No identification is made of the content of the “misrepresentations” or the time, place, materiality, or identity of the Defendant who misrepresented investment strategies and objectives. The phrase “investment strategies and objectives” is ambiguous. Moreover, the CPOM states the objectives of the Dymas Fund in detail, discusses Investment strategies employed, and states that certain risks exist and no return could be guaranteed. [Doc. No. 4, CPOM, Exhibit E at 5,10-17]. Accordingly, the undersigned recommends that the District Court GRANT Defendants’ motions to dismiss Plaintiffs’ allegation in Count III ¶ 35(j) for failure to comply with the pleading requirements in Rule 9(b) and the PSLRA. (xi)As part and parcel of Defendants’ fraud upon Plaintiffs, Defendants caused to be purchased on Plaintiffs’ behalf, interest in Dymas Partners, L.P., an entity owned or controlled by Defendants over a period beginning in or about May 2000 and continuing through April 2001. Defendants failed to disclose to Plaintiffs the extent of Defendants’ ownership and control of Dymas Partners, L.P., the state of organization, the type of business, the financial condition, or any of the particulars of that entity nor did Defendants disclose that the security was unregistered and illiquid. [Complaint at Count III, ¶ 37] Plaintiffs’ eleventh, and final, allegation claims that Defendants made a material omission in failing to disclose the ext