Full opinion text
MEMORANDUM AND ORDER ON THE REPORT AND RECOMMENDATION OF MAGISTRATE JUDGE STEARNS, District Judge. After careful consideration of defendants’ eight vigorously articulated Objections to Magistrate Judge Dein’s Report and Recommendation, I will ADOPT her Report and Recommendations with one small caveat. A few comments are in order. Although one might think otherwise from a reading of the thirty-five pages of the Objections, the Report is nuanced, objective, and balanced. The Magistrate Judge recommends the allowance of defendants’ motion for summary judgment on a number of plaintiffs claims, including the claims of breach of fiduciary duty (usurpation of corporate opportunities), and all breach of contract claims other than those related to the (allegedly) promised IPO. Where differences exist between defendants and the Magistrate Judge, they focus principally on two issues: (1) defendants’ objection to evidence that the Magistrate Judge credited that they find unbelievable, uncorroborated, or unreliable, see, e.g., Objections, at 11-12; and (2) her refusal to treat certain claims of reliance on the part of plaintiff as unreasonable as a matter of law, see, e.g., id. at 16. With respect to the first issue, defendants make strong arguments about the quality and force of much of the evidence, but do not give sufficient recognition to the Magistrate Judge’s scrupulous deference to a summary judgment standard that requires her to give plaintiff, as the non-moving party, the benefit of every contested (and uncontested) factual inference. See Oliver v. Digital Equip. Corp., 846 F.2d 103, 105 (1 st Cir.1988). As to the second area, the issue is not that the Magistrate Judge did not recognize that in very limited circumstances reliance can be unreasonable as a matter of law, see Report, at 57 — 58; rather she found that the facts — again viewed in the light most favorable to plaintiff — take this case out of the exception and commit it to a resolution by the jury. Finally, the suggestion that the Magistrate Judge failed to recognize the evidentiary consequences of the various integration agreements is simply not borne out by the Report, see, e.g., id. at 44. ORDER For the reasons stated by the Magistrate Judge in her Report, defendants’ Motion for Summary Judgment is DENIED as to Counts I, V, VI, and VII; ALLOWED as to Count II; and ALLOWED in part and DENIED in part as to Counts III and IV. The Clerk will assign a date for trial of the remaining claims. Counsel will, within ten (10) days of the date of this Order, submit a joint estimate of the number of days anticipated for trial of the case, consistent with a daily jury sitting of 9:00 a.m. to 1:00 p.m. SO ORDERED. REPORT AND RECOMMENDATION ON DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT DEIN, United States Magistrate Judge. I. INTRODUCTION The plaintiff, Paul Bergeron (“Berger-on”), has brought this action on behalf of himself and the P. Bergeron Nominee Trust against Ridgewood Securities Corp., its affiliated entities and three of its officers (collectively, the “Defendants” or “Ridgewood”), claiming that the Defendants made material misrepresentations and omissions in order to induce Bergeron to invest in five separate private equity funds created and marketed by the Defendants, and that they breached certain contractual obligations and fiduciary duties owed to investors of their funds. The individual Defendants include Robert E. Swanson, the ultimate owner of the Ridge-wood companies, Robert L. Gold, an officer of Defendant Ridgewood Capital Management, LLC, and Randall D. Holmes, an officer of Defendant Ridgewood Renewable Power LLC. By his Second Amended Complaint, Bergeron has asserted claims against the Defendants for violation of the Massachusetts Uniform Securities Act, Mass. Gen. Laws ch. 110A, § 410 (Count I), breach of fiduciary duty (Count II), breach of contract (Count III), breach of the implied covenant of good faith and fair dealing (Count IV), fraud and deceit (Count V), negligent misrepresentation (Count VI) and unfair and deceptive trade practices under Mass. Gen. Laws ch. 93A (Count VII). The investments giving rise to this litigation were made in two general categories of Ridgewood funds. The first category of funds, known as the “Power Funds,” offered accredited investors an opportunity to invest in the independent power and renewable energy sector. Bergeron initially invested in Ridgewood’s Power Trust V Fund on January 23, 1998, and on December 31, 1998, he invested in Ridge-wood’s Power Growth Fund. The second category of funds, known as the “Venture Funds,” consisted of a series of venture capital funds that invested in private technology companies. Bergeron purchased shares in three of Ridgewood’s Venture Funds during the time period between April 26,1999 and January 7, 2002. Bergeron claims that the Defendants fraudulently induced him to invest in these funds by representing that Ridgewood was planning a $500 million initial public offering (“IPO”) of its power generating assets when they knew that there were no concrete plans for achieving an IPO and that no feasibility analysis had ever been conducted, and by falsely promising Bergeron a guaranteed 4% return on his investment leading up to the IPO. He further claims that the Defendants breached their fiduciary and/or contractual obligations under the Venture Fund offering documents by investing in early stage companies, and by shifting investment opportunities away from existing funds and into newly created funds. Bergeron asserts that he has lost $900,000 as a result of the Defendants’ conduct. The Defendants deny Bergeron’s claims, and contend that the plaintiff was a sophisticated investor who deliberately sought out and invested in high risk products in the hopes of achieving high returns. They assert that Bergeron’s financial loss is unrelated to any misconduct on their part, but instead is attributable to significant adverse developments in the independent power business, and to the crash of the high-tech and dot.com markets, which decimated the companies acquired through the Ridgewood funds. This matter is presently before the court on the “Defendants’ Motion for Summary Judgment” (Docket No. 79) by which the Defendants are seeking summary judgment on all of Bergeron’s claims. For all the reasons detailed below, this court recommends to the District Judge to whom this case is assigned that the motion for summary judgment be ALLOWED IN PART and DENIED IN PART. Specifically, this court recommends that the motion be DENIED as to Count I; ALLOWED as to Count II; DENIED as to the claims relating to the IPO in Counts III and IV, but otherwise ALLOWED as to Counts III and IV; and DENIED as to Counts V, VI and VII of the Second Amended Complaint. II. STATEMENT OF FACTS The following facts are undisputed unless otherwise indicated. The Parties Plaintiff Paul Bergeron is an individual who resides in Wellesley, Massachusetts. (2d Am.Compl. (“Compl.”) (Docket No. 78) ¶ 1). He is the trustee and beneficiary of the P. Bergeron Nominee Trust. (Id.). Bergeron holds a college degree in economics, and has served as the President of several companies, including Wang Canada, Interbace Software and Charter Systems. (DF ¶ 10, PR ¶ 10). Prior to his introduction to Ridgewood, Bergeron had substantial experience as an investor, and had managed his own buying and selling of stock. (DF ¶¶ 14, 19). In particular, Bergeron had previously invested in both high-tech stocks and non-stock market products. (Id. ¶ 14). The Ridgewood family of companies has been offering private equity investment opportunities to high net worth individuals since 1982. (DF ¶ 1). It consists of three core business programs, including oil and gas investments, renewable electric power investments and venture capital investments. (Id.). Defendant Ridgewood Renewable Power LLC (“Ridgewood Power”), the successor in interest to defendant Ridgewood Power Corporation, manages business trusts that own and operate renewable electric power and infrastructure projects. (DF ¶2). It has raised over $350 million, which has been invested in projects located in various states and overseas. (Id.). Between 1997 and 2001, Ridgewood Power organized and managed a series of private equity Power Funds that offered accredited investors an opportunity to invest directly in businesses operating in the independent power and renewable power sectors. (PF ¶2; DF ¶4). Certain of Bergeron’s claims in this case arise out of his investments in two of those Funds, including the Ridgewood Electric Power Trust V (“Power Trust V”) and the Ridgewood Power Growth Fund (“Power Growth Fund”). Defendant Ridgewood Capital Management, LLC (“Ridgewood Capital”) manages private equity venture capital funds that invest in a diverse portfolio of private technology companies. (DF ¶ 3). Between 1997 and 2001, Ridgewood Capital managed the Ridgewood Capital Venture Partners LLC Funds I, I-B and II. (Id. ¶ 4). Bergeron has asserted contractual and fiduciary claims arising from his investments in each of these Venture Funds. During the relevant time period, defendant Ridgewood Securities Corporation served as the placement agent for the Power and Venture Funds. (Id. ¶ 6; PR ¶ 6). Defendant Robert E. Swanson (“Swanson”) was responsible for the formation of Ridgewood Power, and is the ultimate owner of the Ridgewood companies. (PF ¶¶ 1, 13). Each of the individual Defendants, including Swanson, Robert L. Gold (“Gold”) and Randall D. Holmes (“Holmes”), serves as an officer of either Ridgewood Power or Ridgewood Capital. (DF ¶ 5). Bergeron’s Receipt of the Power Fund Offering Memorandum In late 1997, Bergeron was introduced to Paul Hess, a financial advisor with Commonwealth Equity Services, Inc. in Boston, Massachusetts, who was authorized to sell Ridgewood securities. (DF ¶ 12; PF ¶ 10). At the time, Bergeron was in his mid-fifties and had recently retired. (DF ¶ 12). Mr. Hess considered the plaintiff to be one of his most sophisticated clients. (Id. ¶ 20). Bergeron told Mr. Hess that he was looking for high return investments, and he characterized himself as an aggressive investor. (DF ¶¶ 17-18; PR ¶¶ 17-18). Mr. Hess recommended that Bergeron purchase an interest in Power Trust V, which he described as a “top-quality income program.” (PF ¶ 11). Shares of Ridgewood funds were offered only to “qualified” or “accredited” investors having a high net worth. (DF ¶ 7; PR ¶ 7). Bergeron certified to Mr. Hess that he was an accredited investor with an annual gross income of over $300,000, significant investments and holdings, and a net worth of nearly $6 million. (DF ¶ 21). Before Bergeron committed to making any investments in any of the Power Funds, Mr. Hess gave the plaintiff a Ridgewood Power Offering Memorandum that described, among other things, the nature of the investments and the potential risks of investing in the Power Funds. (DF ¶ 30; PR ¶ 30; Def. Ex. B). In particular, the Offering Memorandum described the objectives of the Power Funds as follows: The business plan of the Trust is to build a portfolio of investments in (a) non-utility generating facilities which sell electrical, motive and/or thermal power, (b) other non-utility facilities which provide power-related products or services, (c) other facilities that provide products or services for the energy or environmental industries and (d) capital facilities that have similar investment and cash flow prospects. These facilities are referred to as “Projects.” The investment objectives of the Trust are to (a) generate current cash flow for distribution to Investors from the operation of the Projects and (b) provide capital appreciation over an extended period either through the sale of all or a portion of the Projects or through the creation of a more liquid investment. This might be achieved by combining the Trust with other entities, by a public offering by the Trust, by creating a market for the Investor Shares or by a combination of these shares. There is no assurance that the Trust will be able to meet those investment objectives. (Def. Ex. B at RW000010). Thus, in the absence of a liquidity event, the purpose of investing in the Power Funds would be to receive periodic checks from the sale of electricity. (PF ¶ 3). With respect to potential risks, the Offering Memorandum contained numerous warnings to investors. For example, but without limitation, the Offering Memorandum provided: THIS INVESTMENT IS SPECULATIVE AND NON-LIQUID AND INVOLVES A HIGH DEGREE OF RISK, including severe restrictions on transferability of the Shares. Because of the Managing Shareholder’s success in offering four prior power trust programs, the Trust should be able to explore the possibility of creating a public market at some future date after its business is well established, either by combining the Trust or its assets with other programs sponsored by the Managing Shareholder so as to create an entity with marketable securities or by organizational changes necessary to allow public trading ... There may be significant legal, tax and business impediments to these alternatives and no Investor should rely upon the possible future availability of a public market for the Investor Shares.... As with most equity investments, there are many risks to the Investor. Among those that especially apply to the Trust are the illiquidity of the Investor Shares, possible insufficient diversification in Projects, possible inability to operate Projects profitably, changes in regulatory and environmental protection requirements, attempts by utilities to terminate power supply contracts that are favorable to the Trust, illiquidity of the Trust’s assets and conflicts of interest. There are many other significant risks. (Def. Ex. B at RW000001, RW000005) (emphasis in original). The Offering Memorandum further provided that potential investors could ask questions and seek additional information from Ridgewood, but it warned investors not to rely on such information unless it was put in writing and signed by Ridge-wood. Specifically, the document read in relevant part: THE PURPOSE OF THIS MEMORANDUM IS TO PROVIDE A PROSPECTIVE INVESTOR WITH THAT INFORMATION WHICH THE TRUST BELIEVES IS PERTINENT IN MAKING AN INFORMED INVESTMENT DECISION AS TO PARTICIPATION IN THE TRUST. IT IS RECOGNIZED THAT ADDITIONAL INFORMATION MAY BE DESIRED BY A PROSPECTIVE INVESTOR PRIOR TO MAKING HIS INVESTMENT DECISION. THEREFORE, EACH PROSPECTIVE PURCHASER MAY ASK QUESTIONS OF THE TRUST AND RECEIVE ANSWERS CONCERNING THE TERMS AND CONDITIONS OF THE OFFERING AND MAY OBTAIN ANY ADDITIONAL INFORMATION WHICH THE TRUST POSSESSES OR CAN ACQUIRE WITHOUT UNREASONABLE EFFORT OR EXPENSE THAT IS NECESSARY TO VERIFY THE ACCURACY OF INFORMATION CONTAINED IN THIS MEMORANDUM. REQUESTS FOR FURTHER INFORMATION SHOULD BE MADE TO THE TRUST AND SUCH INFORMATION SHOULD BE RELIED UPON ONLY WHEN FURNISHED IN WRITTEN FORM AND SIGNED ON BEHALF OF THE TRUST (Def. Ex. B at RW000007) (additional emphasis added). Bergeron read the Offering Memorandum and signed a certification confirming his receipt of the document. (DF ¶¶ 32-33; PR ¶ 32). By signing the certification, the plaintiff agreed, among other things, that “I cannot rely on any other representations than those appearing in the [Offering Memorandum].” (DF ¶ 32; PR ¶ 32; Def. Ex. F at 115-16). He also acknowledged that he had read the disclosures in the Offering Memorandum about risks and considered the investment suitable. (Id.). In January 1998, prior to making his initial investment in the Power Funds, Bergeron spoke to Swanson by telephone. (PF ¶ 13; Pl.Ex. E at 57-58). The parties dispute the substance of the statements that Swanson made to Bergeron during the course of the call. (See DF ¶ 47). When the evidence is viewed in Bergeron’s favor, it shows that during the call, Bergeron asked several questions concerning the risk and nature of the investment, as well as questions about Ridgewood’s plan for a Power Fund IPO. (Bergeron Aff. ¶ 4). Swanson told Bergeron that the investment was low risk because it involved utilities rather than the stock market. (Id.). Furthermore, Swanson said that Ridge-wood would have a Power IPO in two or three years, and he further assured the plaintiff that he would receive annual interest payments of 4% leading up to the IPO. (Id.; PF ¶ 15). According to Berger-on, Swanson summed up the call by asking, “where else could you get guaranteed 4% interest?” (PF ¶ 15; see also Pl.Ex. E at 58; Bergeron Aff. ¶ 4). It is undisputed that none of the •written offering documents made any mention of guaranteed interest payments or otherwise indicated that Ridgewood was obligated to make periodic payments to shareholders of the Power Funds other than distributions out of any cash flow generated by the operations of the power projects. Nevertheless, Bergeron claims that he relied upon Swanson’s representations regarding guaranteed payments of 4% and plans for an IPO in deciding to invest with Ridge-wood. (PF ¶¶ 16-17). Bergeron’s Investment in the Power Trust V Fund On January 23, 1998, Bergeron invested $100,000 in Ridgewood’s Power Trust V Fund. (DF ¶ 24). In connection with his investment, Bergeron signed a Subscription Agreement by which he agreed, among other things, to purchase shares in the Fund and by which he made certain representations and warranties. (DF ¶ 36; PR ¶ 36; Def. Ex. V. at RW000727-29). Significantly, the plaintiff represented and warranted that he had read the Offering Memorandum and that he was “not relying on any oral statement made to [him] or written material supplied to [him] and not otherwise contained in the [Offering] Memorandum in deciding to purchase Shares subscribed for herein.” (DF ¶ 39; PR ¶ 39; Def. Ex. V at RW000727-28). Pursuant to the Subscription Agreement, Bergeron also acknowledged that “I have been advised that the shares involve a high degree of risk and that there are no assurances that I will recover my investment or receive any return at any time.” (DF ¶ 41; PR ¶ 41; Def. Ex. V at RW000729). On February 11, 1998, Ridgewood sent a welcome letter to all of the shareholders of the Ridgewood Power Trust V, including Bergeron. (PF ¶ 18). Therein, Ridge-wood stated that “[w]hile we are getting the Fund fully invested you will receive quarterly dividend payments ... Once the Fund is fully invested we will switch over to monthly dividends for Trust V, just as we are making monthly dividends in each of the other four Ridgewood Power Trusts.” (PLEx. I at RW002668). Ridge-wood also advised its investors that the Power Trust V Fund had closed at $90 million, and that the size of the Fund, “combined with the $120 million in the earlier Trusts give us a total critical mass that will greatly enhance the potential for our planned Initial Public Offering.” (Id. at RW002669). Consistent with the letter, Bergeron did receive quarterly payments of 1% from Ridgewood. (PF ¶ 18-19). The parties dispute whether these payments were “dividends,” as Ridgewood described them in its correspondence to investors, or whether they constituted “interest.” (See DF ¶¶ 91-92; PF ¶¶ 20-21). It is undisputed that Bergeron did not have a promissory note pursuant to which interest would be payable, (DF ¶ 92; PR ¶ 92), and that Ridgewood described the payments as “dividends” rather than interest payments throughout its communications with investors. (See, e.g., PLEx. 1 at RW002668 (2/11/98 letter); RW002661 (4/28/98 letter); RW002644 (7/28/98 letter)). However, there is also evidence in the record indicating that Ridgewood treated the payments as “interest” for tax purposes. (PF ¶ 20). Bergeron continued to receive quarterly payments of 1% until January 30, 2001, when Ridgewood announced in a letter to its Power shareholders as follows: We are suspending the quarterly dividends from each of the six Ridgewood Power Funds for the entire calendar year for two independent and valid reasons. First, in preparation for a possible IPO we want to strengthen each Fund and use cash to improve the performance of the power plants. Second, the California power crisis has caused a temporary interruption in the cash flow from power plants owned by Ridgewood Power Trusts I, II and III. (PLEx. I at RW002766). Ridgewood further stated in its letter that “many Ridgewood Power investors are primarily interested in reliable, stable dividends, as opposed to potential capital appreciation,” and assured its investors that “[i]f for any reason we are not able to effectuate our IPO we would make a catch up dividend a year from now.” (PLEx. I at RW002767-69; see also PF ¶¶ 24-25). Nevertheless, no Ridgewood Power IPO has occurred, and no catch-up payments were ever made to Ridgewood’s Power Fund investors. (PF ¶ 26). Bergeron’s Investment in the Power Growth Fund On February 17, 1998, Ridgewood sent a letter to its Power investors in which it announced the formation of the Power Growth Fund. (PF ¶48; PLEx. I at RW002662). Ridgewood described the Fund as “extremely similar to the five Ridgewood Power Trusts.” (PF ¶ 48). However, Ridgewood informed investors that the Power Growth Fund would not be part of the Power IPO, stating: Under our current plan The Ridgewood Power Growth Fund will not be part of the IPO. The Ridgewood Power Growth Fund is expected to close about a year after Power Trust V. Consequently, we anticipate that The Ridgewood Power Growth Fund will have its assets fully invested and showing stable or growing earnings probably about a year after we have the IPO for the first five Power Trusts. Once The Ridgewood Power Growth Fund matures, we anticipate exchanging The Ridgewood Power Growth Fund assets for shares of the Ridge-wood Power IPO. We believe that the potential for built-in acquisitions by the IPO of The Growth Fund assets will substantially enhance the attractiveness of the IPO. We believe that the potential anticipated liquidity by merging with the IPO will substantially enhance the attractiveness of The Ridgewood Power Growth Fund. It is all part of the same business plan. We are just doing it in stages. (Pl.Ex. I at RW002665). In a letter dated October 22, 1998, Ridgewood indicated that it intended to achieve the Power IPO in about 18 months, or by late April 1999. (Pl.Ex. I at RW002635). Bergeron invested $100,000 in the Power Growth Fund on December 31, 1998. (DF ¶ 24). He claims that his decision to do so was based upon Ridgewood’s representations regarding the IPO and Swanson’s earlier promise of guaranteed interest payments. (PF ¶ 53). In connection with his investment in the Power Growth Fund, Bergeron certified that he had read the Power Fund Offering Memorandum. (DF ¶ 35). He also signed a Subscription Agreement containing the same representations and warranties that he had made in connection with his investment in the Power Trust V Fund. (DF ¶ 44; PR ¶ 44; Def. Ex. I at 152-53). Ridgewood’s Efforts to Achieve an IPO Between February 1997 and July 2002, Swanson sent twenty-three letters to Ridgewood’s investors in which he discussed the Power IPO. (PF ¶ 29). Berger-on read each of the letters he received and trusted the information contained therein. (Bergeron Aff. ¶ 13). The parties dispute whether Ridgewood misled investors about the prospects for achieving an IPO. The Defendants assert that Ridgewood had every intention of accomplishing a public offering, but that “deteriorating market conditions impacted the ability of the projects owned through the Power Funds to operate at a profit and derailed plans for an IPO....” (Def. Mem. (Docket No. 83) at 10). The plaintiff contends that Ridgewood “did nothing whatsoever to bring about an IPO” and that it “hid the fact that it lacked a plan, personnel, experience or even the earnings required to effectuate the IPO, and instead used the prospect of the Power IPO to supercharge its marketing for the Power funds and launch the Venture funds.” (PI. Mem. (Docket No. 105) at 8, 20-21). As detailed below, Bergeron has presented evidence to support his position. Therefore, the issue should be resolved by a jury. Ridgewood first seriously considered taking the Power Funds public in 1997, after two larger competitors in the power business, AES and Calpine, went public with great success. (DF ¶ 66). However, in 1997, when Ridgewood announced its intention to achieve a Power IPO to its shareholders, Ridgewood had not engaged an investment bank or financial advisor, and no one on Ridgewood’s senior management team had ever taken a company public. (PF ¶¶ 37-39; Pl.Ex. A at 50-51, 83). Moreover, although Gold explained that bringing a company public would have required “at least five people’s almost full time job for months and months and months, right, the financial people, the management, CFO[,]” as of May 2000, Swanson had not assigned any staff to work exclusively on the Power IPO, and none of the individual Defendants had taken responsibility for effectuating an IPO. (See PF ¶¶ 36, 40-42, 44; Pl.Ex. A at 83-84). Additionally, Ridgewood had no written plan for achieving an IPO. (PF ¶¶ 46-47). In January 1999, Ridgewood did retain Donaldson, Lufkin & Jenrette (“DLJ”), a leading investment bank in the independent power industry, to advise the company on the IPO process and to determine whether an IPO was feasible. (PF 1154; DF ¶ 67; PR ¶ 67). On January 13, 1999, Swanson notified shareholders of this development, announcing that the Power Funds had retained DLJ “to advise us on how to maximize shareholder value at our planned IPO.” (PLEx. I at RW002594). Swanson also informed investors that “Ridgewood Power, DLJ, and our lawyers will go through an exercise as if we were preparing for the IPO immediately. We want to identify issues today so that when we do bring out the IPO we will attract a higher price/earnings ratio.” (Id.). However, DLJ was never engaged to be the underwriter for the offering. (PF ¶ 54). Several months later, in April 1999, Ridgewood further informed its shareholders that it was relying on DLJ “to guide us in preparation for an IPO of the Ridge-wood Power Trusts” and that “DLJ’s advice about the IPO is very encouraging.” (PLEx. I at RW002576). Ridgewood also advised its shareholders that the IPO would be delayed for about another two years, until 2001.(7d). Specifically, Ridge-wood stated that it would follow DLJ’s advice to include the Power Growth Fund in the IPO, and that while the inclusion of that Fund would “add about 50% to the size of the IPO[,]” it would also “delay the IPO to 2001 due to the time needed to get the funds invested.” (Id.). Nevertheless, Ridgewood maintained that it was “extremely encouraged about the prospects for the Ridgewood Power IPO. DLJ is the leading investment bank in the Independent Power industry and we are receiving significant value by retaining them as our advisors.” (Id. at RW002578). Despite Ridgewood’s representations about DLJ’s role in the IPO process, DLJ was not vigorous in advising Ridgewood. (PF ¶ 57). Ridgewood and DLJ did not conduct any exercises as if they were preparing for the IPO immediately, and DLJ did not provide Ridgewood with any written analysis regarding the feasibility of an IPO. (Id. ¶¶ 57-58). In fact, the record indicates that DLJ generated no written work product at all during the time of its engagement by Ridgewood. (See Nystrom Aff. ¶¶ 2-5). Furthermore, by July 1, 1999, about six months after Ridgewood had retained DLJ, the parties’ relationship had come to an end. (PLEx. A at 122-24). Due to DLJ’s failure to perform the services Ridgewood had expected, Ridgewood decided not to pay it the second $100,000 of its $200,000 retainer. (Id.). Ridgewood did not advise investors of these developments. (PF ¶ 63). Although Ridgewood ultimately hired a law firm to advise it on taking the Power Funds public, it did not retain another investment bank or financial firm to assist it. (Id. ¶ 68; PLEx. A at 124-25). The Feasibility of an IPO As of 1999, Swanson understood that based on market conditions existing at the time, Ridgewood would need a market capitalization of $500 million (at a 15x or 16x multiple) in order to achieve a successful IPO, and that this would require earnings of over $30 million from the Ridge-wood Power Fund projects. (PF ¶ 87; Pl. Ex. A at 136-45). Ridgewood had no positive earnings at that time. (PF ¶ 88; Pl. Ex. A at 142-43). Furthermore, as of 2001, the net operating cash flow for all of the Ridgewood Power Fund companies was $1.1 million, which would not have supported a $500 million IPO at any capitalization rate. (PF ¶ 91). Thus, it is undisputed that Ridgewood never had the profitability necessary to achieve an IPO. (See DF ¶ 86). Nevertheless, Ridgewood continued to tell its shareholders that it intended to accomplish an IPO in 2001. For example, in August 1999 and December 2000, Ridge-wood sent letters to its Power Fund investors in which it confirmed that it was planning an IPO by the end of 2001. (PF ¶¶ 71-72). Additionally, in a letter dated February 15, 2001, Ridgewood informed investors that it had entered a quiet period under the securities laws, stating, “[w]e must be very careful about what we say because we are contemplating an IPO at the end of this year.” (PF ¶ 76). In order for Ridgewood to complete an IPO, it was first necessary to have the Power Funds fully invested and experience a full year of earnings. (PF ¶ 78). It was also necessary to complete the merger of the Power Trusts, retain an investment bank, hire a public company CEO to run Ridgewood, file a registration statement and prospectus with the SEC, and conduct a road show. (Id.). However, as of early 2001, the only step Ridgewood had taken was to retain a law firm to assist it with the merger of the Power Trusts. (PF ¶ 79). On March 30, 2001, Ridgewood sent a letter to investors in which it noted that “the IPO market is exceedingly gloomy” and “has already been moribund for about one year (since May, 2000)____” (PLEx. I at RW002751). Still, Ridgewood continued to tell investors that it was taking steps necessary to accomplish the IPO. Thus, on September 27, 2001, Ridgewood sent investors a status report in which it stated that “Ridgewood Power is continuing to prepare for the merger of the various Ridge-wood Power Trusts and related entities” and represented that it would “work towards our goal of a consolidation of the funds which we firmly believe will maximize the value of your Ridgewood investment.” (PLEx. I at RW002703). About five months later, in February 2002, Ridgewood notified its Power Fund shareholders that it would not be seeking approval to merge the Power Trusts that year, but that it would do so as soon as conditions with respect to the Trusts and the general market would permit. (PLEx. I at RW002958). Ridgewood stated that the primary problem for the IPO market in the independent power sector, and the reason for the delay of the merger, was Enron and the fall-out from Enron on companies like Calpine. (Id. at RW002961). It also noted that “AES fell earlier in 2001 for issues unrelated to Enron” and that the entire sector was in disfavor. (Id.). However, Ridgewood confirmed its goals of increasing the value of shareholder assets, increasing or recommencing dividends, and providing liquidity. (Id. at RW002961-62). On April 4, 2003, Ridgewood sent a letter to its investors in which it stated that “[t]he Power and Energy Funds are designed to generate high yielding, tax-deferred cash flow[,]” and that “because they are structured to generate high, current cash flow, they are not subject to stock market risk.” (PLEx. I at B 001624) (emphasis omitted). Bergeron asserts that the language used in this letter contrasted sharply with the Defendants’ earlier statement that Ridgewood’s “objective is to provide our Shareholders with liquidity at a maximum gain,” and amounted to an admission that there would be no Power Fund IPO. (PF ¶¶ 83-84). He claims that at some point after he received the April 2003 letter, he realized that the Defendants had strung him along, and that no Power IPO was going to take place. (PF ¶ 85). Eventually, Ridgewood confirmed Bergeron’s assessment. In a letter dated July 9, 2004, Ridgewood informed investors that: The macro-economic events of September 11, 2001, the collapse of the IPO market, and the California Energy Crisis put an immediate halt to our plans for an IPO. The subsequent financial blood bath in the Independent Power Generation sector makes a near term IPO highly unlikely, even though Ridge-wood is determinedly increasing our cash flow, asset by asset. The collective Ridgewood Renewable Power Funds’ cash flow has improved dramatically since early 2003, and should improve dramatically by the end of next year. Despite the improved cash flow that Ridgewood reasonably projects, an IPO appears unlikely at least for several years.... (PLEx. I at RW003087). The Venture Funds On December 9, 1998, Ridgewood distributed a letter to its Power Fund investors announcing the launch of Venture Fund I, which would aim to maximize capital gain by investing in a portfolio of companies that would be taken public or sold within two to four years. (PF ¶ 95; Pl.Ex. J at RW001002, RW001004). In its letter, Ridgewood also stated in relevant part that: [t]he primary focus of the Venture Fund will be on late stage, prelPO companies which already have developed a superior technology or product and which now need immediate capital to expand manufacturing and marketing. We are not interested in finding people with brilliant ideas and financing the development of those ideas. We are interested in nurturing brilliant ideas which have already been developed. (PLEx. J at RW001003) (emphasis omitted). This was consistent with representations that were made by Gold, the manager of the Venture Funds, during an investor conference call that Bergeron participated in prior to making any investments in the Funds. (See PLEx. F at 109-11). According to Bergeron, Gold said that Venture I would only invest in portfolio companies with developed products, revenue streams and distributions channels rather than in seed stage or dot-com companies. (Bergeron Aff. ¶ 18). Bergeron claims that despite these representations, the Venture Funds invested in seed companies and internet-based companies in early stages of development, including such companies as Medibuy, Horsepower.com, Myrio, Feedroom and NovaCrystals. (PF ¶ 121). Ridgewood further told investors that “[w]e have the skills and have developed the infrastructure to evaluate and manage investments in their pre-IPO stage. The work that we have been doing to prepare the Ridgewood Power Trusts for an IPO has focused our attention on the requirements and extraordinary opportunities of pre-IPO companies.” (PLEx. J. (12/9/98 letter) at RW001002). Bergeron claims that he ultimately decided to invest in the Venture Funds because of Gold’s assurances about the nature of the investments and the Defendants’ representations regarding their expertise in the venture marketplace and their experience in preparing for the Power Fund IPO. (Bergeron Aff. ¶ 18; PF ¶ 105). Between April 26, 1999 and January 7, 2002, Bergeron invested a total of $700,000 in three separate Venture Funds, including Venture Fund I, Venture Fund II, and Venture .Fund I-B. (DF ¶¶ 122,126). Bergeron’s Receipt of the Venture Fund Offering Memoranda Prior to making investments in each of the Venture Funds, Bergeron received an Offering Memorandum that provided information about the nature of the investment and the risks involved. Therein, Ridge-wood warned prospective shareholders that the investments were speculative and involved “a very high level of risk for the Investor.” (DF ¶¶ 110-12; PR ¶¶ 110-12). As was the case with the Power Funds, the Offering Memoranda for the Venture Funds also authorized potential investors to ask questions and receive information from the Fund, but cautioned that “[t]he Investor should rely on that additional information only if it is given in writing and signed on behalf of the Fund.” (DF ¶ 112; PR ¶ 112). With respect to the nature of the Venture Fund investments, the Offering Memoranda provided, among other things, that “[t]he Fund will prefer making investments in companies with existing products that need capital to bring products to market or to expand, rather than in ‘seed-stage’ companies that are developing products, but the Fund may invest in either type of company.” (Def. Ex. C at RW000337). Additionally, in a section entitled “Diversification Considerations,” the Memoranda read as follows: The Funds will attempt to reduce the high risks of venture capital programs by investing in a number of companies serving different markets and at different stages of maturity, (ii) limiting the Funds’ investments in very early-stage companies, and (iii) investing in Portfolio Companies with other investment programs sponsored by the Manager or its affiliates and [possibly] with other professional venture capital investors ... THERE IS NO ASSURANCE THAT THE FUNDS WILL RECEIVE SUFFICIENT CAPITAL TO CARRY OUT THEIR INVESTMENT AND RISK-REDUCTION OBJECTIVES OR THAT THEY WILL BE ABLE TO INVEST SUCCESSFULLY. Actual portfolio composition may be dictated by market conditions and funding opportunities that are beyond the Manager’s control. Consequently, there can be no assurance that these portfolio management objectives can be met. (DF ¶ 112; PR ¶ 112) (emphasis in original). Among the risks described in the offering documents was the risk that there were material, potential conflicts of interest involved in the operation of the Fund, including, among others, potential conflicts created by “competing demands for allocating investment or divestiture opportunities among programs,” and conflicts arising between the interests of the particular Venture Fund “and other programs sponsored by [Ridgewood Capital] and its Affiliates if those programs are co-owners of Portfolio Companies with the Fund[J” (Def. Ex. C at RW000375). More specifically, the Offering Memoranda provided: Co-Investment and Similar Conflicts. A conflict of interest might arise if at any given time an opportunity to invest in a Portfolio Company would be suitable for more than one Investment Program, thus requiring the Manager to choose among the suitable Programs. The Manager may also determine that more than one Investment Program should invest in a Portfolio Company, in which case those Programs will be co-owners. The Fund expects that most of its investments will be made concurrently with investments by the Institutional Fund on similar terms and conditions and that the conflicts of interest described here may occur in most cases. (DF ¶ 134; PR ¶134; Def. Ex. C at RW000403) (emphasis in original). The Co-Investment provisions described two set of policies for the Fund Manager to follow in resolving such conflicts. (DF ¶ 135; PR ¶ 135; Def. Ex. C at RW000403). The first policy, which is relevant to the instant case, was to apply in instances where more than one Venture Fund had money available to invest at about the same time and under similar terms. (Id.). It provided that Ridgewood would determine how much each Fund would invest based on a variety of factors, including but not limited to, “the effects of the investment on the diversification of each [Fund’s] portfolio, potential alternative investments, the effects an investment by either [Fund] would have on the [Fund’s] risk-return profile, the estimated tax effects of the investment on each [Fund], the amount of funds available and the length of time those funds have been available for investment.” (Def. Ex. C at RW000403). Significantly, the OfferingMemoranda went on to state: If more than one [Fund] has funds available for investment and the factors discussed above and other considerations indicate that the Portfolio Company has approximately equal benefit for each [Fund], the Manager will generally allocate the opportunity first to the [Fund] that was first organized, to the extent of its funds that can be prudently invested in that opportunity. In general the Manager will seek to apply all uninvested funds of that [Fund] to the opportunity, unless doing so would cause the [Fund] to be significantly overcommitted to a Portfolio Company. Any remaining investment opportunity would then be offered successively to later-organized [Funds] on the same basis. (Id. at RW000403-04; see also DF ¶ 136; PF ¶ 127). In addition to receiving and reviewing the Offering Memoranda, Bergeron signed a Subscription Agreement before investing in each Fund. (DF ¶ 116; PR ¶ 116). Therein, Bergeron made various representations and warranties, including that he had read and understood the Offering Memorandum and was “not relying on any oral statement made to me or written material supplied to me and not otherwise contained in the Memorandum in deciding to purchase Shares subscribed for herein.” (Def. Ex. EE at RW000756-57; Def. Ex. FF at RW000783) (emphasis in original). He further agreed that “I have been advised that the Shares involve a high degree of risk and that there are no assurances that I will recover my investment or receive any return at any time.” (Def. Ex. EE at RW000758; Def. Ex. FF at RW000784). Bergeron’s Investment in Venture I Unlike his investments in the Power Funds, Bergeron’s investments in the Venture Funds were made through an initial downpayment and several follow-on capital calls, which occurred as the Venture Fund identified specific investments. (DF ¶ 123; PF ¶ 109). Thus, on April 26, 1999, Bergeron committed to invest $250,000 in the Venture I Fund. (DF ¶ 122; PF ¶ 108). On that same day, he made an initial downpayment of $85,000, but the remaining amount was invested pursuant to four separate capital calls between June 2, 1999 and October 20, 1999. (DF ¶ 126; PF ¶ 109). Ridgewood provided Bergeron with information regarding the Portfolio Companies in which the Fund was investing before Bergeron made the initial investment, and prior to each capital call. (DF ¶ 124; PR ¶ 124). Although Bergeron had the option of making or declining to make each of the capital calls, any refusal to participate in a capital call would have resulted in the loss of a portion of his deposit and the forfeiture of the right to participate in future capital calls for the Fund. (PF ¶ 110). The lead investment of the Venture I portfolio was a company known as Medibuy. (DF ¶ 214). Venture I invested $3 million in Medibuy in exchange for 20% ownership. (Def. Ex. D at 66). Although Gold told investors that Medibuy alone ought to have achieved fabulous returns and made the Fund’s model, the company-failed to achieve an IPO, was ultimately sold off, and returned only 13 cents on the dollar to investors of Venture I. (PF ¶¶ 117, 119-20; DF ¶ 159). The parties dispute whether Medibuy was a good investment that was adversely affected by the collapse of the high technology market in the 2001-02 time frame or whether it was a more risky investment than Ridge-wood led investors to believe. (See DF ¶¶ 214-21; PR ¶¶ 214-21; PF ¶¶ 115-21). In any event, it is undisputed that Venture I was a total loss. (PF ¶ 122; Pl.Ex. C at 79). Bergeron’s Investment in Venture II On October 22, 1999, Ridgewood sent a letter to its Venture Fund shareholders announcing the formation of the Venture II Fund. (Pl.Ex. J at RW001103). Ridge-wood told its shareholders that it was offering Fund II because Fund I was fully invested. (Id.). Ridgewood also stated that Venture II would be making an early stage equity investment in an internet commerce company called Horsepower.com by investing, along with Venture Fund I, in the first round, or “A Round,” of financing. (Id. at RW001104). Ridge-wood explained that while each of Venture I and Venture II would invest in the “A Round” of financing, only Venture II was expected to make follow-on investments in subsequent pre-IPO financing rounds of Horsepower.com. (Id. at RWOO 1104-05). It further told its investors that “Venture Fund I is not in the position to invest millions of dollars more in Horsepower.com because we are doing the investment out of cash reserves from the various capital calls.” (Id. at RW001105). Therefore, Ridgewood informed investors, “[i]f you would like a larger position in Horsepower.com, you will have to join Fund II.” (Id.). Bergeron claims that Ridgewood offered further investment opportunities in Horsepower.com only through Venture II “[a]s part of its hook to get investors in Venture I to chase their investments to Venture II[J” (PF ¶ 125). On November 11, 1999, Bergeron purchased one share in Venture II for $250,000, and on March 17, 2000, he purchased another one-half share in the Fund for $125,000. (DF ¶ 122). Bergeron made an initial deposit and then a series of payments and capital calls between March 6, 2000 and December 14, 2000. (Id. ¶ 126). Like Venture I, Venture II was a total loss. (PF ¶ 130). Alleged Transfer of Investment Opportunities to Later Funds Bergeron claims that, as illustrated in the case of Horsepower.com, Ridgewood consistently gave away investment opportunities to new funds, thereby forcing investors to participate in the newly created Fund. (See PF ¶¶ 132-36). It is undisputed that Funds which participated in initial or “A Round” financing for portfolio companies obtained the right to participate in subsequent, follow-on financing, and that in many cases, Ridgewood transferred the follow-on financing rights of earlier established Funds to later established Funds without providing any payment or other consideration to the earlier Fund. (PF ¶ 131-33; Pl.Ex. C at 83-96; 137-39). Accordingly, shareholders who wanted further investment opportunities with those portfolio companies would need to invest in newly created Funds. Ridgewood offered its existing investors a 10% discount for investing in a subsequent Fund. (PF ¶ 138; PLEx. D at 320-21). Bergeron contends that Ridgewood was motivated to lure its shareholders into new Venture Funds by the fact that new funds generated substantial investment fees. (See PF ¶¶ 154-57). Over 90% of Ridge-wood Capital’s revenue came from investment fees, and Ridgewood received 5.6 cents for every dollar invested in the Funds. (Id. ¶¶ 154-55). Furthermore, Ridgewood charged an annual management fee of 1.5% of each Fund’s capital contributions. (Id. ¶ 156). Thus, when Ridgewood was not generating profit participation, it made money by opening new funds. (Id. ¶ 157). Gold denied that fees ever drove Ridge-wood’s decisions to create new funds or to allocate capital. (Def. Ex. D at 102-03). Moreover, Gold explained that Ridgewood gave follow-on financing opportunities to new funds in instances when it believed that the earlier established fund had enough of an investment in the portfolio company and Ridgewood determined that it was not prudent to make an additional investment, or when the earlier established fund was fully invested. (See Pl.Ex. C. at 85-90). The record demonstrates that Ridgewood informed its shareholders of its decisions to allocate such investment opportunities to new funds, and explained the basis for those decisions. For example, as described above, Ridgewood explained that it was giving the rights to follow-on financing in Horsepower.com to Venture II and not Venture I because Venture I was not in a position to invest millions of dollars more in the company. (Pl.Ex. J at RW001105 (10/22/99 letter)). Additionally, as described below, Ridgewood explained to investors, when it created the Venture I-B Fund, that it was not taking opportunities away from existing funds because those funds either were fully invested and unable to participate in additional financing, or were already investing to the extent that had been planned earlier. Bergeron has presented no facts to indicate that Ridgewood’s explanations were untrue or were otherwise made without consideration of the factors set forth in the co-investment provisions of the Venture Fund Offering Memoranda. Bergeron’s Investment in Venture I-B On November 8, 2001, Ridgewood sent a letter to its Venture I investors notifying them of the formation of the Venture I-B Fund. (PF ¶ 146; Pl.Ex. J at RW001431). Ridgewood told its investors that the new Fund would “invest in a very small number of what we believe are the very best companies with which Ridgewood Capital is involved!,]” including “four or five Portfolio Companies which are investments of Fund I” and “investments of Fund II or Fund III....” (Pl.Ex. J at RW001431). Ridgewood also said that it was forming the Venture I-B Fund “because we want to improve your overall investment return and we want to improve our track record.” (Id. at RW001432). Ridgewood represented that although the Venture I-B Fund would participate in investments of other Venture Funds, it would not be taking opportunities away from those Funds. (Id. at RW001431-32). In particular, Ridgewood stated that the Venture I Fund was fully invested and unable to participate in the available investment rounds. (Id. at RW001432). It also explained that the investment by Venture I-B in Nova Crystals, a company in which Venture Funds II and III had stakes, would be an additional investment that would not limit the amounts that the earlier established Funds had already planned to invest. (Id.). Bergeron invested $75,000 in Venture IB by making a single payment on January 7, 2002. (DF ¶¶ 122, 126). He claims that his decision to invest in the Fund was based on representations made by Swanson and Gold that Venture I-B presented a chance for him to recover some of the losses he had sustained in connection with Venture I, and that the new Fund was going to invest in the best companies in the Venture Fund portfolios. (PF ¶ 150). Bergeron’s investment in Venture I-B was a total loss. (Id. ¶ 153; DF ¶ 226; PR ¶ 226). Additional factual details relevant to this court’s analysis are provided below. III. ANALYSIS A. Summary Judgment Standard of Review Summary judgment is appropriate when “the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). “A dispute is ‘genuine’ if the evidence about the fact is such that a reasonable jury could resolve the point in the favor of the non-moving party.” Sanchez v. Alvarado, 101 F.3d 223, 227 (1st Cir.1996) (quotations and citations omitted). A material fact is one which has “the potential to affect the outcome of the suit under the applicable law.” Id. (quotations and citations omitted). The moving party bears the initial burden of establishing that there is no genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986). If that burden is met, the opposing party can avoid summary judgment only by providing properly supported evidence of disputed material facts that would require trial. See id. at 324, 106 S.Ct. at 2553. “[T]he nonmoving party ‘may not rest upon mere allegation or denials of his pleading,’ ” but must set forth specific facts showing that there is a genuine issue for trial. LeBlanc v. Great Am. Ins. Co., 6 F.3d 836, 841 (1st Cir.1993) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S.Ct. 2505, 2514, 91 L.Ed.2d 202 (1986)). The court must view the record in the light most favorable to the non-moving party and indulge all reasonable inferences in that party’s favor. See O’Connor v. Steeves, 994 F.2d 905, 907 (1st Cir.1993). “If, after viewing the record in the non-moving party’s favor, the Court determines that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law, summary judgment is appropriate.” Walsh v. Town of Lakeville, 431 F.Supp.2d 134, 143 (D.Mass.2006). B. Count I: Alleged Violation of Massachusetts Uniform Securities Act In Count I of his Second Amended Complaint, Bergeron alleges that the Defendants are liable under the Massachusetts Uniform Securities Act, Mass. Gen. Laws ch. 110A, § 410 (“Securities Act”). In order to establish a violation of the Securities Act, Bergeron must prove that “(1) the defendant ‘offers or sells a security’; (2) in Massachusetts; (3) by making ‘any untrue statement of a material fact’ or by omitting to state a material fact; (4) the plaintiff did not know of the untruth or omission; and (5) the defendant knew or ‘in the exercise of reasonable care [would] have known,’ of the untruth or omission.” Marram v. Kobrick Offshore Fund, Ltd., 442 Mass. 43, 52, 809 N.E.2d 1017, 1026 (2004) (quoting Mass. Gen. Laws ch. 110A, § 410(a)(2)) (alteration in original). Bergeron claims that in connection with the sale of shares in the Funds, the Defendants made misrepresentations, which they knew or should have known were false at the time they were made, regarding guaranteed interest payments, Ridge-wood’s plan for an IPO, DLJ’s role in the IPO, the timing of and fiscal reality concerning the IPO, and Ridgewood’s experience with the Power IPO and venture investing. (Pl. Opp. Mem. at 22). The Defendants contend that the plaintiffs claims under the Act must fail because Bergeron cannot establish that any of the Defendants’ statements were false or that any alleged misrepresentations concerned material facts as opposed to “non-actionable opinions, projections, expectations, beliefs, hopes, statements of potential, promises, and ‘puffery.’ ” (Def. Mem. at 94). This court finds that there are genuine issues of material fact that preclude summary judgment for the Defendants on these grounds. Accordingly, this court recommends that the motion be denied with respect to Count I. As an initial matter, the Defendants argue that Bergeron has not presented evidence showing that he actually read or heard the alleged misrepresentations before making his various investment decisions. (Id.). However, the plaintiff does not need to prove that he relied on the untrue statements or omissions in order to prevail on a claim under the Securities Act. See Marram, 442 Mass. at 53, 809 N.E.2d at 1026-27 (“because G.L. c. 110A, § 410(a)(2), holds the seller liable for inaccurate disclosure or nondisclosure of material information, foremost among the elements that the buyer does not have to prove is reliance.”) (quotations and citation omitted). Rather “[a]ll that is required is ignorance of the untruth or omission.” Id. at 54, 809 N.E.2d at 1027. Falsity of Alleged Statements With respect to the issue of falsity, Bergeron has presented facts supporting an inference that the Defendants made statements which they knew or should have known were false when made. In particular, the record shows that beginning in 1997, the Defendants repeatedly made statements to the effect that they were planning for an IPO, even though Ridge-wood had not retained an investment bank or financial advisor, had no team in place to plan or otherwise effectuate an IPO, had no written plan for achieving an IPO and had no senior management employees who had taken a company public. (See PF ¶¶ 29, 36^2, 44, 46-47; Pl.Ex. A at 83-84). Additionally, when the record is viewed in the light most solicitous to the plaintiff, it reveals that Ridgewood never even performed an evaluation as to the feasibility of an IPO. (See PF ¶ 58; Nystrom Aff. ¶¶ 2-5). These facts support an inference that the Defendants made representations concerning its plans for an IPO knowing that the representations were false, and intentionally misled their investors into believing there was a realistic prospect for an IPO, even though they had not done anything to achieve that goal or even to determine whether an IPO would be viable. The record further supports a conclusion that at least as of 1999, the Defendants knew that Ridgewood’s earnings did not come close to supporting an IPO. (PF ¶¶ 87-88, 91; Pl.Ex. A at 135-43). However, they did not disclose that information to their investors. Instead, the Defendants continued to tell investors that Ridgewood was planning to accomplish an IPO in 2001. (See PF ¶¶ 71-72). A jury could find, based on these facts, that Ridgewood knew or should have known that there was never any likelihood of an IPO, but wanted, its shareholders to think otherwise. Similarly, a jury could find that Swanson’s representation that Bergeron would receive guaranteed payments of 4% was knowingly false when made. It is undisputed that nothing in the Power Fund offering documents guaranteed shareholders a return on their investments. (See Def. Ex. B at RW000010 (warning that there was no assurance that Ridgewood would be capable of meeting its objective of generating cash flow for distribution to investors)). Furthermore, the Subscription Agreement that Ridgewood provided to Bergeron required him to acknowledge that “there are no assurances that I will ... receive any return at any time.” (Def. Ex. V at RW000729). Given the inconsistencies between the offering materials and Swanson’s statement, a jury could reasonably conclude that Swanson’s representation was false. Additionally, in light of Swanson’s status at Ridgewood and his role in answering investor questions about the Fund, a jury could also determine that Swanson “knew or in the exercise of reasonable care [would] have known,” that his representation concerning guaranteed payments was false. Marram, 442 Mass, at 52, 809 N.E.2d at 1026 (quotations and citation omitted; alteration in original). Nature of Alleged Misrepresentations This court also disagrees with the Defendants’ characterization of the challenged statements as non-actionable predictions, opinions or puffery. Certain of those representations and omissions, including but without limitation the alleged promise of guaranteed interest payments, Ridgewood’s failure to inform investors that its relationship with DLJ had ended, its failure to tell investors that it had not evaluated the feasibility of an IPO and the Defendants’ representation to prospective Venture Fund investors that they had gained experience preparing for the Power IPO, are “susceptible of knowledge” and can therefore be understood as factual statements or omissions rather than opinions or forecasts. Stolzoff v. Waste Sys. Int’l, Inc., 58 Mass.App.Ct. 747, 760, 792 N.E.2d 1031, 1041 (2003) (quotations and citation omitted). Furthermore, “[i]n general, the [challenged] statement or omission must concern a fact, and not an opinion or belief, unless such an opinion is inconsistent with facts known at the time they are made.” Marram, 442 Mass. at 57 n. 24, 809 N.E.2d 1017. See also Glassman v. Computervision Corp., 90 F.3d 617, 627 (1st Cir.1996) (“While forecasts are not actionable merely because they do not come true, they may be actionable to the extent they are not reasonably based on, or are inconsistent with, the facts at the time the forecast is made.”). To the extent the Defendants’ statements about the Power IPO could be viewed merely as forecasts of a possible future event, those statements remain actionable if they are undermined by inconsistent facts that were known to the Defendants at the time. That is the case here. When viewed in Bergeron’s favor, the record shows that Ridgewood repeatedly led investors to believe that an IPO was possible and that it was actively pursuing that goal despite having no factual basis for concluding that a public offering was financially achievable and despite having knowledge of facts, such as the lack of any plan or team in place for effectuating an IPO, that undermined such representations. Additionally, “[w]hat might be innocuous ‘puffery’ or mere statement of opinion standing alone may be actionable as an integral part of a representa