Securities & Exchange Commission v. Goldstone (233 F. Supp. 3d 1169, 2017)

United States District Court for the District of New Mexico 2017-01-26

Commerce and Trade

Citations

Full opinion text

MEMORANDUM OPINION AND ORDER

James 0. Browning, UNITED STATES DISTRICT JUDGE '

i'HIS MATTER comes before the Court on the Defendants’ Renewed Motion for Judgment as a Matter of Law, filed July 27, 2016 (Doc. 594)(“Renewed Motion for Judgment”). The Court held a hearing on December 1, 2016. The primary issues are: (i) whether specific factual findings the jury made that Defendant Larry A. Gold-stone and Defendant Clarence G. Simmons III did not falsify books or records, and that Thornburg Mortgage did not fail to keep accurate books or records, require dismissal of Plaintiff Securities and Exchange Commission’s claim .that Goldstone and Simmons made false statements or omissions to Thornburg’s accountant, KPMG, LLP; and (ii) whether the SEC presented legally sufficient evidence at trial for a reasonable jury to conclude that Goldstone committed securities fraud on February 28, 2008, either by making statements on the. Consumer News and Business Channel (“CNBC”) or in an email to Thornburg Mortgage’s Investor Relations group. Because the jury’s factual findings do not necessarily imply that Goldstone or Simmons did not make a misleading statement or omission to KPMG, the jury’s verdict does not require dismissal of the SEC’s rule 13b2-2(a) claim. Further, when viewed in the light most favorable to the SEC, the SEC presented evidence by which a reasonable jury could find that Goldstone knowingly or recklessly made a false or misleading statement on February 28, 2008, amounting to securities fraud. Accordingly, the Court grants in part and denies in part the Defendants’ Renewed Motion for Judgment. The Court grants the Defendants’ Renewed Motion for Judgment regarding Claims 2, 3, and 6. The Court denies the Defendants’ Renewed' Motion for Judgment regarding Claims 1 and 8.

FACTUAL BACKGROUND

-The Court takes its facts from the Complaint, filed March 13, 2012 (Doc. 1). The Court presents the facts solely to provide context for the Renewed Motion for Judgment. It continues to adhere to the decisions on the facts that it reached in SEC v. Goldstone, No. CIV. 12-0257 JB/GBW, 2015 WL 5138242 (D.N.M. August 22, 2015)(Browning, J.)(“Summary Judgment Opinion”).

The Defendants are former officers of Thornburg Mortgage: Goldstone was the chief executive officer, Simmons was the chief financial officer, and Jane E. Starrett was the chief accounting officer. See Gom-plaint 111, at 1. The SEC alleges that the Defendants were involved in fraudulent misrepresentations and omissions made in connection with the 2007 Form 10-K. Complaint ¶¶ 1-3, at 1-2. The SEC asserts that the Defendants misled and withheld important financial information from Thornburg Mortgage’s outside auditor, KPMG LLP, such as the impending collapse of a large European hedge fund that held mortgage-backed securities (“MBS”) similar to the Thornburg Mortgage’s adjustable rate mortgage (“ARM”) securities. See Complaint ¶¶ 76-79, at 22.

Thornburg Mortgage was a publicly traded single-family mortgage lender and real estate investment trust, founded in 1993, headquartered in Santa Fe, New Mexico, and was once the second-largest independent mortgage company in the United States of America after Countrywide Financial Corporation. See Complaint ¶ 2, at 1; id. ¶ 20, at 7. During the time relevant to the Complaint’s allegations, Thornburg Mortgage’s shares were traded on the New York Stock Exchange. See Complaint ¶20, at 7. Thornburg Mortgage’s lending operations focused on “jumbo” and “super-jumbo” ARM securities; Thornburg Mortgage also purchased ARM securities that third parties originated. Complaint ¶ 21, at 7. Thornburg Mortgage used most of its earnings to pay dividends, and obtained financing for its mortgage and investment business through reverse repurchase agreements backed by ARM securities. See Complaint ¶ 3, at 2. Thorn-burg Mortgage’s reverse repurchase agreements “typically consisted of a simultaneous sale of pledged securities to a lender at an agreed price in return for Thornburg Mortgage’s agreement to repurchase the same securities at a future date (the maturity date) at a higher price.” Complaint ¶ 22, at 7-8. The reverse repurchase agreements required Thornburg Mortgage to maintain a certain degree of liquidity and subjected Thornburg Mortgage to margin calls if the value of the ARM securities serving as collateral on the agreements fell below a specified level. See Complaint ¶ 22, at 8. A margin call would generally require Thornburg Mortgage to pay cash to reduce its loan amount or to pledge additional collateral to the lender, either on the same day that Thornburg Mortgage received the margin call or on the following day, unless the parties agreed otherwise. See Citigroup Global Markets, Inc. as Intermediating Agent for Citigroup Global Markets Limited and [Counterparty] Thornburg Mortgage, Inc., International Securities Lenders Association ISLA Global Master Securities Lending Agreement § 5.8, at 11, filed May 21, 2012 (Doc. 37-6)(brackets in original); Master Repurchase Agreement Between Greenwich Capital Markets, Inc., and Thornburg Mortgage, Inc. § 4(c) at 5, filed July 20, 2012 (Doc. 60-2); id. at § 11(a), at 7-8; Master Repurchase Agreement Between Credit Suisse First Boston Corporation and Thornburg Mortgage Asset Corporation § 4(c), at 4, filed July 20, 2012 (Doc, 60-3); id. at § 11(a), at 7; Complaint ¶ 23, at 8. Thornburg Mortgage’s failure to timely meet a margin call would be an event of default and would allow a lender to declare Thornburg Mortgage in default, which would trigger cross-defaults on Thornburg Mortgage’s other reverse repurchase agreements, and all lenders with whom Thornburg Mortgage had defaulted would then be allowed to seize and to sell the ARM securities collateralizing Thorn-burg Mortgage’s loans. See Complaint ¶ 24, at 8. Receiving margin calls was part of Thornburg Mortgage’s normal course of business, as the value of its ARM securities often fluctuated. See Complaint ¶ 25, at 8.

Citigroup Global Markets, Inc.’s margin call on February 21, 2008, was the largest of the three margin calls that Thornburg Mortgage could not immediately meet— $196 million. See Complaint ¶ 33, at 10. In response to Thornburg Mortgage’s inability to meet the Citigroup Global margin call on February 21, 2008, Citigroup Global sent a letter to Goldstone and Simmons, stating that Thornburg Mortgage had breached the parties’ reverse repurchase agreement and reserving Citigroup Global’s right to declare Thornburg Mortgage in default. See Complaint ¶3, at 2; id. ¶ 34, at 10-11 (citing Letter from Stephen G. Malekian to Thornburg Mortgage, Inc., Re: The Global Master Securities Lending Agreement dated as of September-20, 2007 Between Citigroup Global Markets, Inc. as Intermediating Agent for Citigroup Global Markets Limited and Together with Citigroup Global Markets, Inc. and Thornburg Mortgage (dated Feb. 21, 2008), filed May 21,2012 (Doc. 37-7)(“Citigroup Global Letter”)). Citigroup Global made clear that, although Citigroup Global was not exercising its rights under the reverse repurchase agreement, it was not waiving its right to declare Thornburg Mortgage in default or to amend the underlying reverse repurchase agreement. See Complaint ¶ 34, at 11. In an email from Goldstone to Simmons, Starrett, and others, dated February 21, 2008, Goldstone stated that he had negotiated a “payment plan with Citigroup Global in order to satisfy the call by the end of [the following] week[.]” Complaint ¶ 61, at 18 (alterations in original)(quoting Email from Clay Simmons to Nyira Gita-na, Subject: FW: TMA Update at 2, sent February 21, 2008, at 9:30 a.m., filed May 21, 2012 (Doc. 37-10)). Thornburg Mortgage paid the Citigroup Global margin call over seven days and made the final payment of seventy-five million dollars on February 27, 2008. See Complaint ¶ 35, at 11.

In the last week of February 2008, Thornburg Mortgage had to sell the interest-only portions of its ARM loans (“I/O Strip Transactions”) to generate sufficient cash to meet the margin calls it received in the second half of the month. See Complaint ¶ 36, at 11. The I/O Strip Transactions further depleted Thornburg Mortgage’s liquidity to meet margin calls. See Complaint ¶36, at 11. In an email from Goldstone to Simmons and Starrett on February 22, 2008, Goldstone informed them of some of Thornburg Mortgage’s plans to raise liquidity to meet margin calls: “ ‘Citi sold two of [Thornburg Mortgage’s] IO securities[] as well for a gain of approximately $25 million and net proceeds to Citi of $10 million.’” Complaint ¶ 67, at 19-20 (alteration in original)(quoting Email from Larry Goldstone to Garret Thornburg, Anne Anderson, David Ater, Eliot Cutler, Francis Mullin III, Ike Ka-langis, Michael Jeffers, Owen Lopez, and Stuart Sherman, Subject: TMA Update— Friday Morning, February 22 at 2, sent February 22, 2008 at 8:42 a.m., filed May 21, 2012 (Doc. 37-8 at 2)(“Feb. 22, 2008, Email”)). In an email sent February 25, 2008, Goldstone informed Simmons and Starrett that Thornburg Mortgage was ‘“moving towards resolving [its] margin issues’” through, among other strategies, having “‘sold some additional IO securities[.]’ ” Complaint ¶ 68, at 20 (quoting Email from Larry Goldstone to the Thorn-burg Mortgage Board of Directors, sent February 25, 2008, at 5:03 p.m., filed May 21, 2012 (Doc. 37-9)(“Feb. 25, 2008, Email”)).

The Defendants planned to quickly raise cash to satisfy Thornburg Mortgage’s future margin calls after filing the 2007 Form 10-K. See Complaint ¶ 32, at 10. The Defendants did not plan to disclose that Thornburg Mortgage was late in meeting margin calls. See Complaint ¶ 32, at 10. In an email, from Goldstone to Simmons and Starrett, on February 22, 2008, Goldstone stated that Thornburg Mortgage was “ ‘planning to sell two of [its] TMA securities’ ” to meet margin calls and that this sale would “ ‘allow[ ] us to keep our current situation quiet while we deal with it.’ ” Complaint ¶ 67, at 20 (alterations in original)(quoting Feb. 22, 2008, Email at 2).

The Defendants “scrambled” to meet Thornburg Mortgage’s margin calls before filing the 2007 Form 10-K. Complaint ¶ 30, at 9-10. In an email from Goldstone dated February 22, 2008, which Simmons and Starrett received, Goldstone stated:

We don’t want to disclose our current circumstance until it is resolved. Our goal for resolution i[s] the filing of our 10-K. How we disclose this issue and what we say will depend on where we are next week when we need to file. But, our plan is to say that we had margin calls and all have been met.

Complaint ¶ 30, at 10 (alteration in original)(quoting Feb. 22, 2008 Email at 2). Goldstone also discussed strategies that would allow Thornburg Mortgage “ ‘to keep [its] current situation quiet while we deal with it’ ” in the same email. Complaint ¶ 31, at 10 (alteration in originalXquoting Feb. 22, 2008 Email at 2). Goldstone also stated: “ ‘Hopefully our disclosure will be a simple one, meaning all margin calls have been met.’” Complaint ¶31, at 10 (quoting Feb. 22, 2008 Email at 3).

Goldstone and Simmons also learned, on February 27, 2008, that a large European hedge fund with substantial MBS holdings, similar to those Thornburg Mortgage held, was collapsing. See Complaint ¶ 38, at 12. Goldstone anticipated that the European hedge fund’s collapse would negatively affect Thornburg Mortgage’s ARM securities and sent an email to Simmons on February 27, 2008, in which he said:

Also, you should know that a large Alt-A hedge fund in Europe is blowing up this afternoon. UBS credit just mentioned it to me. They got hit with 20 point haircuts on Alt-A and AAA’s overnight. I think we will get this a little more gradually, but we should be ready for it.

Complaint ¶ 38, at 12 (quoting Email from Larry Goldstone to Clay Simmons at 2, sent February 27, 2008, at 3:48 p.m., filed May 21, 2012 (Doc. 37-21)(“Feb. 27, 2008 Goldstone/Simmohs Email”)). Simmons sent an email to Goldstone and others regarding the potential collapse of the European hedge fund, stating: “ ‘This makes it even more critical to be done with Citi today so we can get the K filed,’ ” Complaint ¶ 39, at 12 (quoting Email from Clay Simmons to Thornburg Mortgage Employee Patrick Feldman and Larry Goldstone at 2, sent February 27, 2008, at 8:08 a.m., filed May 21, 2012 (Doc. 37-20)(“Feb. 27, 2008, Simmons/Feldman Email”)). Later on February 27, 2008, Simmons sent an email to Starrett, in which he stated: “ T gave [Thornburg’s SEC Reporting manager] a 6:00 AM Thursday deadline to file the K. I do not want there to be any issues based on Thursday activity.’” Complaint ¶40, at 12 (alteration in original)(quoting Email from Clay Simmons to Jane Starrett at 2, sent February 27, 2008, at 10:35 a.m., filed May 21, 2012 (Doc. 37-38)(“Feb. 27, 2008 Simmons/Starrett Email”)).

Thornburg Mortgage filed its 2007 Form 10-K on February 28, 2008, approximately twelve hours after sending its last payment to Citigroup Global and meeting its outstanding margin calls. See Complaint ¶ 3, at 6; id. ¶ 41, at 12. Goldstone, Simmons, and Starrett drafted and reviewed Thornburg Mortgage’s 2007 Form 10-K before filing it, and Goldstone and Simmons signed the Form 10-K. See Complaint ¶ 7, at 3. In the 2007 Form 10-K, Goldstone and Simmons represented that Thornburg Mortgage had successfully met its margin calls without selling any assets. See Complaint ¶ 7, at 3; 2007 Form 10-K at 35 (“[DJespite these challenges, we successfully continue to meet all margin calls, we maintain existing short-term financing facilities with our existing finance counter-parties and we have successfully added new financing capacity since year end.”); id. at 39 (“In the event that we cannot meet future margin calls from our available cash position, we might need to selectively sell assets in order to raise cash. To date, no such sales have been required ....”). Thornburg Mortgage’s 2007 Form 10-K accounted for the I/O Strip Transactions as the issuance of secured debt. See Complaint ¶ 37, at 11. The 2007 Form 10-K also stated that Thornburg Mortgage had the “ ‘intent and. ability to hold its ARM Securities until their value recovered in the market,’ ” notwithstanding that the lenders which declared Thornburg Mortgage in default of reverse repurchase agreements could have seized Thornburg Mortgage’s ARM securities pledged as collateral. Complaint ¶ 8, at 3 (quoting 2007 Form 10-K at 41). In accordance with the statement that Thornburg Mortgage had the intent and ability.;to hold its ARM securities until their value, recovered, Thornburg Mortgage did not recognize $427.8 million in losses associated with its ARM securities that served as collateral on its reverse, repur chase agreements.. See Complaint ¶ 8, at 4. Thornburg Mortgage also reported a fourth-quarter 2007 profit. See Complaint II11, at 4. “Thornburg’s . Form 10-K and accompanying financial statements were also incorporated into the company’s active Form S-3 ASR registration statement, relating to Thornburg Mortgage’s dividend reinvestment and stock purchase plan, which was signed by Goldstone and Simmons and had been filed with the Commission on December 10, 2007.” Complaint ¶ 89, at 26.

Thornburg Mortgage began receiving margin calls at 6:00 a.m. on February 28, 2008. See Complaint ¶ 41, at 12-13. Thorn-burg Mortgage’s stock prices fell after it filed the 2007 Form 10-K. See Complaint ¶ 10, at 4; Thornburg Hit with Margin Calls; Shares Slide, Dow Jones New-swires, Feb. 28, 2008, filed May 21, 2012 (Doc. 37-29)(“Feb. 28 Dow Jones New-swire”); Thornburg, MF Global Send Financial Stocks Lower, Dow Jones Market-Watch, Feb. 28, 2008, filed May 21, 2012 (Doc. 37-30). Simmons commented to Goldstone, in an early-morning email regarding Thornburg Mortgage’s falling stock prices: “I guess the recent development section did not go over well. If they only knew.” Complaint ¶ 10, at 4 (quoting Email from Clay Simmons to Larry Gold-stone at 2, (sent February 28, 2008, at 6:33 a.m.), filed May 21, 2012 (Doc. 37-24)(“Feb. 28, 2008, Simmons/Goldstone Email”)). In an email from Goldstone to Thornburg Mortgage’s Investor Relations department on February 28, 2008, at 5:29 a.m., Goldstone instructed the group to “ ‘try to calm the panic,’ ” and to inform investors that “ ‘[a]ll margin calls met,’ ‘[l]enders are fine,’ and ‘[w]e have sufficient operating cash[.]’ ” Complaint 1194, at 27 (alterations in original). See Email from Larry Goldstone to Thornburg Mortgage IR Department Employees Amy Pell, Suzanne O’Leary Lopez, and Allison Yates at 2, (sent February 28, 2008, at 5:29 a.m.), filed May 21, 2012 (Doc. 37-27). At 6:56 a.m., Goldstone informed Thornburg Mortgage’s Board of Directors in an email that he estimated Thornburg Mortgage had approximately forty million dollars available in cash at that time. See Complaint ¶ 95, at 28; Email from Larry Goldstone to Thorn-burg Mortgage Board of Directors at 2, (sent February 28, 2008, at 6:56 a.m.), filed May 21, 2012 (Doc. 37-ll)(“Feb. 28, 2008 Email”). As of 7:30 a.m. on February 28, 2008, Thornburg Mortgage had received over $100 million in margin calls. See Complaint ¶ 9, at 4; id. ¶ 41, at 13.

In the afternoon of February 28, 2008, Goldstone appeared on CNBC’s Street Signs. See Complaint ¶ 98, at 28. On Street Signs, Goldstone stated that: (i) he did not believe Thornburg Mortgage would need to sell assets; (ii) Thornburg Mortgage had “‘met all of [its] lending requirements’”; and (iii) Thornburg Mortgage had “ ‘liquidity and cash available to continue to support the portfolio.’ ” Complaint ¶ 98, at 28 (alterations in original)(quoting Street Signs: Interview with Larry Gold-stone at 3:54-4:09, CNBC television broadcast February 28, 2008, filed May 21, 2012 (Doc. 37-1)).

On the evening of February 28, 2008, Thornburg Mortgage received a default notice from J.P. Morgan Chase Bank, N.A. for an unpaid margin call that J.P. Morgan had issued to Thornburg Mortgage earlier that day. See Complaint ¶ 41, at 13. At the end of the day on February 28, 2008, Gold-stone, Simmons, and Starrett confirmed, via email, that the “ ‘top messages [they] reinforced in the market’ ” were: “ ‘We have met all margin calls to date, and we expect to continue to do so. We have sufficient operating cash, and we don’t expect to sell assets to meet margin calls. We returned to profitability during the fourth quarter despite a tough market.’ ” Complaint ¶ 96, at 28 (alterations in original).

As part of Thornburg Mortgage’s auditing process in 2007, Thornburg Mortgage had to assess whether it had the intent and ability to hold its ARM securities until maturity, or when they recovered their value on the market—referred to as an “other-than-temporary impairment ... analysis” (“OTTI analysis”). Complaint ¶¶ 49-50, at 50-51. As part of Thornburg Mortgage’s 2007 audit, KPMG assessed whether Thornburg Mortgage’s OTTI analysis was accurate. See Complaint ¶ 49, at 14-15. The Defendants did not disclose to KPMG: (i) Thornburg Mortgage’s “precarious” financial condition, Complaint ¶ 51, at 15; (ii) that Thornburg Mortgage was in violation of its repurchase agreements and relying on lender forbearance to meet its margin calls, see Complaint ¶ 51, at 15; (iii) that Thornburg Mortgage had used I/O Strip Transactions to meet margin calls in the last two weeks of February, 2008, see Complaint ¶ 99, at 29; (iv) that Thornburg Mortgage had received the Citigroup Letter, see Complaint ¶ 99, at 29; or (v) that the European hedge fund was on the verge of collapse, see Complaint ¶ 76, at 22.

The Defendants each signed Thornburg Mortgage’s February 27, 2008, management representation letter to KPMG, in which they represented that: (i) Thorn-burg Mortgage was in compliance with all aspects of its contractual obligations that would have a material effect on its consolidated financial statements in the event of a noncompliance; (ii) Thornburg Mortgage had the intent and ability to hold its impaired securities for a sufficient period of time to allow for them to recover their value in the market; (iii) Thornburg Mortgage had experienced no subsequent events requiring it to adjust or disclose its financial statements; and (iv) Thornburg Mortgage’s financial statements disclosed all matters of which the Defendants were aware that were' relevant regarding Thorn-burg Mortgage’s ability to continue as a going-concern. See Complaint ¶57, at 17. Goldstone and Simmons did not inform the auditor of the possible collapse of a large European hedge fund, which held ARM securities similar to Thornburg Mortgage’s. See Complaint ¶ 76, at 22. “[A]t or about the time” that Simmons learned of the possible collapse of the European hedge fund, he had “just advised ... Thornburg’s outside auditor that he believed the MBS market had reached its lowest point and MBS prices were not likely to deteriorate further.” Complaint ¶ 77, at 22-23.

On March 3, 2008, KPMG requested from the Defendants evidence “that the events subsequent to filing were unforeseeable catastrophic events.” Email from KPMG Senior Manager Jennifer Hall to Larry Goldstone, Jane Starrett, Clay Simmons, and Shawn Buniel at 2, (sent March 3, 2008 11:44 p.m.), filed May 21, 2013 (Doc. 37-28)(“March 3, 2008 Hall Email”). The requested evidence included “correspondence -with lenders/attorneys/shareholders, emails.” Request for Correspondence, attached to March 3, 2008 Hall Email at 3-4, filed May 21, 2012 (Doc. 37-28)(“Request for Correspondence”). See Complaint ¶ 100, at 29. KPMG also requested a “position paper,” which “provides the Company’s assessment of the ability to. hold securities for the foreseeable-future as of August 27, 2008, including but-not'limited to ... [correspondence with5 counter parties for the two weeks prior to filing, along with supporting evidence.” Request for Correspondence at 4. At the time, KPMG, as auditor, was considering whether to restate Thornburg Mortgage’s financial statements and was reevaluating its audit opinion’s validity. See Complaint ¶ 99, at 29. Goldstone and Simmons were aware of the Citi Letter, but did not provide it to the auditor. See Complaint ¶ 101, at 29. KPMG did not become aware of the Citi Letter while preparing its Restatement. See Complaint ¶ 101, at 29. Simmons reviewed and approved an analysis for the auditor which explained that Thornburg Mortgage’s margin calls on February 28, 2008, and the correspondingv collapse in. the mortgage market, were part of ‘“an unforeseeable catastrophic decline in mortgage market valuations-.’ ” Complaint ¶ 102, at 29 (quoting ABX Index Moves Late February at 2-3, fíied May 21, 2012 (Doc. 37-25)(“Posi-tion Paper”)). The analysis states: “ ‘Due to a number of factors including the unexpected collapse of a major hedge fund in Europe the mortgage market gapped significantly wider... [.] No one in the market could have foreseen the sudden decline in mortgage valuations.’ ” Complaint ¶ 103, at 30 (quoting Position Paper at 2)(empha-sis in Complaint).

PROCEDURAL BACKGROUND

The SEC filed this enforcement action on March 13, 2012. See Complaint at 1. The SEC alleges eleven claims for relief: (i) fraud in violation' of § 10(b) of the Exchange Act of 1934, 15 U.S.C. §§ 781(b)p and rule 10b-5,17 C.F.R. § 240.10b-5; (ii) controlling person liability for fraud under § 20(a) of the Exchange Act, 15 U.S.C. § 78t;‘ (iii) aiding and abetting in fraud in violation of § 10(b) of the Exchange Act and rule 10(b)-5; (iv) fraud in violation of § 17(a) of the Securities Act, 15 U.S.C. § 78a(b); (v) falsifying books, records, or accounts in violation of § 13(b)(5) of the Exchange Act, 15 U.S.C. § 78m(b)(5), and rule 13b2—1; (vi) false certification in violation of rule 13a-l4 of the Exchange Act; (vii) deceit of auditors in violation of rule 13b2-2 of the Exchange Act, 17 C.F.R. § 240.13b2-2; (viii) aiding and . abetting in false SEC filings in violation of § 13(a) of the Exchange Act, 15 U.S.C. § 78m(a), and rules 12b-20, 17 C.F.R.’ § 240,12b-20, and 13a-l, 17 C.F.R. § 240.13a-U; (ix) control person liability for false SEC filings under § 20(a) of the Exchange Act and rules 12b-20 and 13a-l; (x) aiding and abetting in keeping false books and records in violation of § 13(b)(2) of the Exchange Act, 15 U.S.C. § 78m(b)(2); and (xi) control-person violation for keeping false books and records under § 20(a) of the Exchange Act. See Complaint ¶¶ 106-43, at 31-39.

The Court granted in part and denied in part the SEC’s and the Defendants’ motions to dismiss on July 8, 2013. See SEC v. Goldstone, 952 F.Supp.2d 1060 (D.N.M. 2013)(Browning, J.). The Motion to Dismiss Opinion dismissed the SEC’s. claims: (i) “based upon the statement in the 2007 Form 10-K and to Thornburg Mortgage’s outside auditor that Thornburg Mortgage successfully met its margin calls without violating its lending agreements, and did not sell assets to meet margin calls”; and (ii) “that the Defendants schemed to defraud Thornburg Mortgage’s outside auditor in connection with the 2007 Form 10-K” SEC v. Goldstone, 952 F.Supp.2d at 1076. It declined to dismiss the SEC’s claim that “the representation that Thorn-burg Mortgage had the intent and ability to hold its impaired assets to maturity or their value recovered in the market at the time it filed the 2007 Form 10-K was materially false or misleading.” SEC v. Goldstone, 952 F.Supp.2d at 1076-77. The Court continued:

The’ Court will not dismiss the SEC’s allegation that Goldstone and Simmons are primarily liable or liable as control persons for that misrepresentation in the 10-K, and the Court will not dismiss the SEC’s allegations that the Defendants aided and abetted the misrepresentation, as the Court has determined that the SEC sufficiently alleged that Goldstone and Simmons made, and the Defendants provided substantial assistance to, the misrepresentation with knowledge of or recklessness to its falsity. Similarly, the Court will not dismiss the SEC’s allegations that the .Defendants misled Thornburg Mortgage’s auditor before the 2007 Form 10-K was filed through the statement that Thorn-burg Mortgage had the intent and abili- ' ty to hold its impaired assets to maturity or their value recovered in the market.

SEC v. Goldstone, 952 F.Supp.2d at 1077. The Court also allowed certain claims against Goldstone and Simmons to proceed. See SEC v. Goldstone, 952 F.Supp.2d at 1077. These claims include the SEC’s allegations that: (i) the Defendants failed to disclose to KPMG before they filed the 2007 Form 10-K that a European hedge fund’s collapse would negatively affect Thornburg Mortgage’s financial condition; (ii) Goldstone materially misrepresented Thornburg Mortgage’s financial condition after filing the 2007 Form 10-K; (iii) the Defendants materially misled KPMG by not providing correspondence showing that Thornburg Mortgage experienced an event of default in the two weeks before the 2Ó07 Form 10-K filing; and (iv) Simmons misrepresented that unexpected events had an unexpected financial impact on Thornburg Mortgage after the 2007 Form 10-K filing. See SEC v. Goldstone, 952 F.Supp.2d at 1077.

The Court later denied the Defendants’ and the SEC’s motions for summary judgment. See SEC v. Goldstone, No. Civ. 12-0257 JB/GBW, 2015 WL 5138242, at *1 (D.N.M. Aug. 22, 2015)(Browning, J.). The Court first explained that it would apply an “actual-disbelief’ standard to determine “whether a person subjectively disbelieved the truth of an opinion statement.” SEC v. Goldstone, 2015 WL 5138242, at *1. The Court then concluded that genuine issues of material fact for the jury existed on the SEC’s claims that: (i) the Defendants made objectively false statements; (ii) the statements were material; (iii) the Defendants believed .that their statements were false when they made them; and (iv) the Defendants made statements .that were false or misleading because of omitted information. See SEC v. Goldstone, 2015 WL 5138242, at *1. The Court thus declined to grant summary judgment for any party on any issue. See SEC v. Goldstone, 2015 WL 5138242, at *1.

Starrett reached a settlement with the SEC on May 20, 2016. See Consent of Defendant Jane E. Starrett at 1 (dated May 20, 2016), filed May 26, 2016 (Doc. 472-l)(“Starrett Consent”). The Starrett Consent neither admits nor denies the Complaint’s allegations, and does not include a requirement that Starrett testify for any of the remaining parties. Starrett Consent at 1.

Ten claims were tried to a jury. These included the claims that the SEC alleged in its Complaint, see Complaint ¶¶ 106-43, at 31-39, excepting the SEC’s claim for fraud in violation of § 17(a) of the Securities Act, 16 U.S.C. § 78a(b). See Pretrial Order at 3-4, filed May 11, 2016 (Doc. 448). The trial commenced on June 6, 2016. See Transcript of Trial Proceeding at 1:13 (taken June 6, 2016)(Court)(“Trial Tr.”)

On June 17, 2016, Goldstone and Simmons moved in open court under rule 60(a) of the Federal Rules of Civil Procedure for judgment as a matter of law and dismissal of the SEC’s claims. See Trial Tr. at 2862:10-12 (Lee). The Court heard argument on the Defendants’ rule 50(a) motion. See Trial Tr. at 2862-2911. The Court also invited further argument by the parties on the Defendant’s rule 60(a) motion. See Trial Tr. at 2911:16-24 (Court). Goldstone and Simmons filed a notice of supporting argument. See Defendants’ Letter Supplementing Rule 50(a) Arguments, filed June 21, 2016 (Doc. 535); Defendants’ Letter in Further Support of Rule 50(a) Motion for a Judgment As a Matter of Law, filed June 21, 2016, (Doc. 546); SEC’s Response to Defendants’ Supplemental Rule 50(a) Arguments, filed June 21, 2016 (Doc. 548); SEC’s Response to Defendants’ Supplemental Rule 50(a) Arguments, filed June 22, 2016 (Doc. 551). The Court did not grant the Defendants’ rule 50(a) motion and submitted the ten claims to the jury. See The Court’s Final Verdict Form at 1-22, filed June 29, 2016 (Doc. 585)(“Final Verdict Form”).

The jury returned a partial verdict on June 29, 2016. See Trial Tr. at 4470:5-10 (Court, Valdez); Final Verdict Form at 1-22. The jury reached a unanimous verdict in favor of Goldstone. and Simmons on five of the ten claims that were tried: (i) falsifying books, records, or accounts in violation of § 13(b)(5) of the Exchange Act, 15 U.S.C. § 78m(b)(5), and rule 13b2-l (“Claim 4”); (ii) control-person violation for keeping false books and records under § 20(a) of the Exchange Act (“Claim 5”); (iii) false certification in violation of rule 13a-14 of the Exchange Act (“Claim 7”); (iv) control person liability for false SEC filings under §§ 13(a) and 20(a) of the Exchange Act and rules 12b-20 and 13a-l (“Claim 9”); and (v) aiding and abetting in false SEC filings in violation of § 13(a) of the Exchange Act, 15 U.S.C. § 78m(a), and rules 12b-20, 17 C.F.R. § 240.12b-20, and 13a-l, 17 C.F.R. § 240.13a-l (“Claim 10”). See Final Verdict Form at 8-11, 14-15 & 18-21. The jury, however, failed to reach a unanimous verdict on the five remaining claims against Goldstone and Simmons: (i) fraud in violation of § 10(b) of the Exchange Act of 1934, 15 U.S.C. §§ 781(b)p and rule 10b-5, 17 C.F.R. § 240.10b-5 (“Claim 1”); (ii) controlling person liability for fraud under § 20(a) of the Exchange Act, 15 U.S.C. § 78t (“Claim 2”); (iii) aiding and abetting in fraud in violation of § 10(b) of the Exchange Act and rule 10(b)—5 (“Claim 3”); (iv) aiding and abetting in keeping false books and records in violation of § 13(b)(2) of the Exchange Act, 15 U.S.C. § 78m(b)(2)(“Claim 6”); and (v) deceit of auditors in violation of rule 13b2-2 of the Exchange Act, 17 C.F.R. § 240.13b2-2 (“Claim 8”). Final Verdict Form at 1-7,12-13 & 16-17.

The jury made specific findings of fact in reaching a verdict in favor of Goldstone and Simmons on Claim 4, Claim 5, and Claim 7. See Final Verdict Form at 8-11, 14-15. In reaching a verdict on Claim 4, the jury found that the SEC did not prove, by a preponderance of the evidence, “[tjhat Mr. Goldstone falsified a book, record, or account, which, in reasonable detail, did not accurately and fairly reflect the transactions and dispositions of the assets of Thornburg,” Final Verdict Form at 8; “[tjhat Mr. Goldstone directly or indirectly falsified or caused to be falsified any book, record, or account of a public company,” Final Verdict Form at 8; “[tjhat Mr. Simmons falsified a book, record, or account, which, in reasonable detail, did not accurately and fairly reflect the transactions and dispositions of the assets of Thorn-burg,” Final Verdict Form at 9; or “[tjhat Mr. Simmons directly or indirectly falsified or caused to be falsified any book, record, or account of a public company,” Final Verdict Form at 9. In reaching a verdict on Claim 5, the jury found that the SEC did not prove, by a preponderance of the evidence, that Thornburg Mortgage either “fail[edj to make and keep books, records, and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Thornburg [Mortgage],” Final Verdict Form at 10-11, or “fail[edj to devise and maintain a system of internal accounting controls sufficient to provide reasonable assurance that transactions were recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles,” Final Verdict Form at 10-11. With respect to its verdict on Claim 5, the jury also specifically found that both Goldstone and Simmons “acted in good faith and did not directly or indirectly induce the act or acts constituting a violation of Section 13(b)(2).” Final Verdict Form at 10-11. Finally, in reaching a verdict on Claim 7, the jury specifically found that the SEC did not prove, by a preponderance of the evidence, that Goldstone or Simmons filed or caused to be filed a false certification that Thorn-burg Mortgage’s 2007 Form 10-K did not contain any untrue statement or omit a fact necessary to make the statements made, in light of the circumstance under which the statement was made. See Final Verdict Form at 14-15; Court’s Final Jury Instructions at 55, filed June 24, 2016 (Doc. 573)(“Jury Instructions”). The jury did not make any specific findings of fact in reaching its verdict in favor of Gold-stone and Simmons on Claim 9 and Claim 10. See Final Verdict Form at 19-21.

Further, the jury made specific factual findings on the Final Verdict Form with respect to Claim 6, despite not returning a verdict regarding that claim. See Final Verdict Form at 12. The jury unanimously found that Thornburg Mortgage did not violate Section 13(b)(2) of the Exchange Act by “failing to make and keep books, records, and accounts, which in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Thornburg.” Final Verdict Form at 12-13. The jury also unanimously found that, in providing substantial assistance to Thornburg Mortgage, Simmons did not act knowingly or recklessly. See Final Verdict Form at 13. After the jury handed the verdict form to the Court, the Court reviewed the verdict form before reading it; the Court noticed that the jury had been able to agree on some factual questions but not on liability. The Court summoned the trial lawyers to the bench for a sidebar before reading the verdict form. The Court asked the parties whether they preferred the Court to read the entire verdict form regarding Claim 6, including the jury’s specific factual findings, or to state that the jury had been unable to reach a verdict and declare a mistrial on Claim 6. See Trial Tr. at 4493:11-15 (Court). The parties indicated their preference that the Court simply declare a mistrial without reading the entire verdict form as to Claim 6—in other words, to not read the factual findings—and further represented to the Court that they had reached an agreement that the jury’s specific factual findings on a claim would not be binding where the jury had not returned a verdict on that claim. See Trial Tr. at 4493:16-23 (McKenna, Lee).

The jury also made specific factual findings on the Final Verdict Form with respect to Claim 8, despite not returning a verdict on that claim. See Final Verdict Form at 16. After declaring a mistrial on Claim 8, the Court read the jury’s answers to two subsidiary questions that the jury had unanimously answered on the verdict form. See Trial Tr. at 4484:3-18 (Court). Regarding Claim 8, the jury found that Goldstone did not make or cause to be made “a materially false statement to an account.” Final Verdict Form at 16. The jury also found, however, that Goldstone “omitted to state or caused another person to omit to state any material fact necessary in order to make the statements made, in light of the circumstances under which such statements were made, not misleading, to an accountant.” Final Verdict Form at 16.

On June 29, 2016, the Court discharged the jury. See Trial Tr. at 4496:7-8 (Court). On July 27, 2016, twenty-eight days after the Court discharged the jury, Goldstone and Simmons timely filed the Renewed Motion for Judgment, seeking judgment on those claims the jury’s verdict did not decide. See Renewed Motion for Judgment. On August 11, 2016, the Court entered judgment in favor of Goldstone and Simmons against the SEC on Claims 4, 5, 7, 9, and 10. See Judgment at 1 (dated July 17, 2016), filed August 11, 2016 (Doc. 597).

1. The Defendants’ Renewed Motion for Judgment as a Matter of Law.

In their Renewed Motion for Judgment, the Defendants assert two principal arguments that the Court should enter judgment in their favor on the remaining five claims. See Renewed Motion for Judgment at 1-11. First, the Defendants argue that the jury’s verdict on Claims 4, 5, 7, 9, and 10, together with the specific factual findings which the jury made in reaching its verdict on Claims 4, 5, and 7, requires dismissal of the majority of the SEC’s remaining claims under the doctrines of collateral estoppel and law of the case. See Renewed Motion for Judgment at 1-11. Specifically, the Defendants argued that the jury’s verdict and specific factual findings preclude and require dismissal of Claim 1, but only as it relates to fraud in the Form 10-K, and Claims 2, 3, 6, and 8. See Renewed Motion for Judgment at 10-11. Second, in their Renewed Motion for Judgment, the Defendants argue that the Court should enter judgment as a matter of law in their favor, because the SEC failed to introduce legally sufficient evidence at trial to support Claims 1,2, 3, and 6. See Renewed Motion for Judgment at 1-2,11-25.

2, The SEC’s Notice of Withdrawal.

On September 23,2016,' the SEC noticed a withdrawal of Claims 2, 3, and 6. See Notice of Withdrawal of Certain Claims at 1, filed September 23, 2016 (Doc. 602)(“No-tice of Withdrawal”). The SEC also noticed that it would no longer pursue Claim 1 as that claim related to Thornburg Mortgage’s 2007 Form 10-K. See Notice of Withdrawal at 1. Consequently, the SEC informed the Court that it would seek to prove at retrial only Claim 1, on the theory that Goldstone’s statements on February 28, 2008, violated Section 10(b) of the Exchange Act of 1934 and Rule 10b-5 thereunder, and Claim 8, on the theory that Goldstone and Simmons made misrepresentations and omissions to KPMG in violation of rule 13b2-2. See Notice of Withdrawal at 1.

3. Two of the Defendants’ • Arguments for Judgment as a Matter of Law Remain Ripe for Decision.

The SEC’s Notice of Withdrawal rendered moot many of the Defendants’ arguments for judgment as a matter of law on Claims 1, 2, 3, and 6. Two of the Defendants’ arguments, however, remain ripe for decision: (i) that the jury’s verdict and specific factual findings preclude and require dismissal of Claim 8; and (ii) that the SEC did not introduce legally sufficient evidence for a reasonable jury to find that Goldstone committed securities fraud by making statements on CNBC the morning of February 28, 2008, or in an email to Thornburg Mortgage’s Investor Relations group regarding “[k]ey message points” to convey. See- Renewed Motion for Judgment at 1, 7-11 & 16-20. ■ -

Regarding the Defendants’ argument that the jury’s findings preclude Claim 8, the Defendants assert that the' SEC must prove that the Defendants made a¡ material false statement to KPMG, either orally or in writing, or declined to state a material fact to KPMG that was necessary to render other statements made to KPMG not misleading. See Renewed Motion for Judgment at 7-9,11. The Defendants then contend that, by necessary implication, the jury found that the Defendants did hot make any such material false statement or omissions. See Renewed Motion for Judgment at 7-9,11. In support of their contention, the Defendants point to the. jury’s specific factual findings regarding Claims 4 and 5 that the Defendants did not . falsify or act unreasonably with any of Thornburg Mortgage’s books and records, that the Defendants did not fail to make" and keep accurate records, and that the Defendants acted in good faith in keeping Thornburg Mortgage’s books and records. See Renewed Motion for Judgment at 7-9, 11.

With respect to the Defendants’ suffi-cieney-of-the-evidence argument,' the Defendants assert that the SEC failed ’to introduce sufficient evidence to prove that Goldstone’s statement on CNBC that “we have met all of our lending requirements” was false. See Renewed Motion for Judgment at 1, 16-20. The Defendants contend that the SEC failed to introduce evidence that Thornburg Mortgage was- not in compliance with its lending requirements at the time that Goldstone made that statement on February 28, 2008. See Renewed Motion for Judgment at 16-20. The Defendants argue that, to satisfy its burden of proof, the SEC had to introduce evidence showing what Thornburg Mortgage’s lending requirements were at the time1 that Goldstone made statements on CNBC, including evidence of the reverse repurchase agreements governing the seven margin calls made on the morning of February 28, 2008, and that Thornburg Mortgage had not met those requirements at the time that Goldstone spoke. See Renewed Motion for Judgment at 17. The Defendants assert that the SEC did not introduce evidence of the terms of the agreements that governed the seven margin calls and, therefore, argue that the SEC presented insufficient evidence of Thornburg Mortgage’s lending requirements and whether those requirements were satisfied at the time of Goldstone’s CNBC statements. See Renewed Motion for Judgment at 17-18.

The Defendants also argue that the evidence at trial is legally insufficient to support Goldstone’s liability for the alleged statements that Thornburg Mortgage’s Investor Relations group made. See Renewed Motion for Judgment at 20-22. The Defendants assert that the record does not contain any document or testimony showing specific statements that Investor Relations personnel made to particular investors. See Renewed Motion for Judgment at 20. The Defendants contend that Investor Relations made all its statements on the telephone, and those statements were neither recorded nor communicated over email or through other writing. See Renewed Motion for Judgment at 20. The Defendants also argue that the SEC failed to introduce any evidence that the statements made by Investor Relations personnel to Thornburg Mortgage’s investors were either false or material. See Renewed Motion for Judgment at 21.

The Defendants further contend that Goldstone was not a “maker” of the Investor Relations statements to Thornburg Mortgage investors and, therefore, that Goldstone cannot be liable for those statements. See Renewed Motion for Judgment at 21 (citing Janus Capital Grp., Inc. v. First Derivative Traders, 564 U.S. 135, 141, 131 S.Ct. 2296, 180 L.Ed.2d 166 (2011)). In support of this contention, the Defendants argue that trial testimony established that Goldstone did not approve the talking points which the Investor Relations group used. See Renewed Motion for Judgment at 21 (citing Trial Tr. at 1206:18-24 (O’Leary); id. at 1218:21-1219:5 (O’Leary); id. at 1220:9-16 (O’Leary)). The Defendants emphasize that the Investor Relations group used Goldstone’s early morning emails as guidance, but ultimately made its own decision about what to communicate to investors. See Renewed Motion for Judgment at 22. The Defendants, therefore, conclude that, because the. Investor Relations group made its own decisions about what to communicate to Thornburg Mortgage investors, the evidence that the SEC presented at trial regarding Goldstone’s early morning email to the group is insufficient to support liability for securities fraud under Claim 1. See Renewed Motion for Judgment at 22.

4. The SEC’s Opposition to the Defendants’ Renewed Motion for Judgment as a Matter of Law.

The SEC opposes the portions of the Defendants’ Renewed Motion for Judgment involving the claims that the SEC did not withdraw. See Plaintiffs SEC’s Opposition to Defendants’ Renewed Motion for Judgment as a Matter of Law at 1-18, filed October 7, 2016 (Doc. 604)(“Op-position”). In its Opposition, the SEG contends that the jury’s verdict does not preclude the jury’s determination upon retrial whether the Defendants made false or misleading statements or omissions to KPMG. See Opposition at 8. The SEC advances several arguments in support of that contention. See Opposition at 1-18

First, the SEC adverts to the jury’s specific factual finding on the Final Verdict Form with respect to Claim 8. See Opposition at 8. Although the jury did not return a verdict on Claim 8, the jury answered “yes” to the question whether Goldstone “ ‘omitted to state or caused to state any material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading, to an accountant?’ ” Opposition at 8 (quoting Final Verdict Form at 16). The SEC concedes that the parties agreed that this finding is not binding. See Opposition at 8; Trial Tr. at 4493:16-23 (McKenna, Lee). Nevertheless, in its Opposition, the SEC argues that the jury’s specific finding “refutes Defendants’ claim that the jury reached the opposite conclusion .... ” Opposition at 8.

Second, attending closely to the factual findings that the jury made on Claims 4 and 5, and to the jury instructions which the Court made with respect to Claim 8, the SEC argues that the jury’s verdict does not necessarily imply that the Defendants did not make false or misleading statements or omissions to KPMG. See Opposition at 9. The SEC notes that the Court instructed the jury that, to find that the Defendants violated rule 13b2-2, the jury had to find that the “Defendants ‘made or caused to be made a false or misleading material statement to an accountant Opposition at 9 (quoting the Court’s Final Jury Instructions (Given), Instruction No. 35, at 46, filed June 24, 2016 (Doc. 574)(“Final Jury Instructions (Given)”))(emphasis in original). The SEC also points to the Court’s jury instruction “that Rule 13b2-2 ‘places an affirmative obligation on officers and managers to disclose material facts that are necessary to prevent statements from being misleading.’ ” Opposition at 9 (quoting Final Jury Instructions (Given), Instruction No. 34, at 45)(emphasis in original). Additionally, the SEC adverts to the Court’s jury instruction that “ ‘Rule 13b2-2 is violated as soon as an officer makes a material misstatement or omits to state a material fact that makes a prior statement misleading.’ ” Opposition at 9 (quoting Final Jury Instructions (Given), Instruction No. 34, at 45). The SEC accordingly argues that, while the jury found that Thorn-burg Mortgage’s records were not false or falsified, in finding for the Defendants on Claims 4 and 5, the jury did not necessarily reach a conclusion about: (i) whether those records were misleading, which the SEC underscored as an adequate basis for liability under rule 13b2-2, see Opposition at 9; (ii) “whether the Defendants satisfied their affirmative obligation to disclose information to their auditors,” Opposition at 9; or (iii) whether a record that was later corrected so as not to be “falsified” was, nevertheless, originally false, Opposition at 10. Additionally, the SEC argues that the jury’s findings regarding Claims 4 and 5 provide no basis to conclude either that the jury unanimously agreed that there were no false records or that the jury’s finding that the Defendants acted in “good faith” necessarily entails a finding that the Defendants did not violate rule 13b2-2. Opposition at 10. The SEC further emphasizes that Claims 4 and 5 addressed only whether a book, record, or account has been falsified. See Opposition at 10. In making factual findings regarding these Claims 4 and 5, according to the SEC, the jury did not necessarily make any finding “about the truth or falsity of oral communications made to KPMG or material withheld from KPMG, both of which support liability under Rule 13b2-2.” Opposition at 11.

Third, the SEC contends that, as a legal matter, collateral estoppel demands an evaluation of the elements of the claims on which a jury reached a verdict, and not on subsidiary factual findings made by a jury established by a verdict form. See Opposition at 11-14. The SEC emphasizes that the Court included the jury’s specific factual findings in the verdict form “ ‘as an indication for [counsel] and for the Court, and also for the Tenth Circuit as to what the jury thought.’ ” Opposition at 11 (alteration- in original)(quoting Trial Tr. at 4471:22-25). The SEC accordingly maintains that the jury’s specific findings are not binding and, hence, cannot support the Defendant’s collateral estoppel argument. See Opposition at 11. Looking exclusively to the jury’s verdicts regarding Claims 4 and 5, the SEC argues that those verdicts are not preclusive of the factual issues underlying Claim 8. See Opposition at 12-13.

The SEC also opposes the Defendants’ assertions that the SEC presented inadequate evidence related to Goldstone’s Feb-ruaiy 28, 2008, statements on CNBC and through Thornburg Mortgage’s Investor Relations gróup. See Opposition at 1. The SEC notés that the Court has previously and painstakingly considered sufficiency-of-the'-'evidence arguments in the Defendants’ motion to dismiss, motion for summary judgment, and motion for judgment as-a matter of law. See Opposition at 3. The SEC argues that the Court should reject the Defendants’ sufficiency-of-the-evidencé arguments they make in their Renewed Motion for Judgment. See Opposition at 3.

Responding to the Defendants’ argument that the SEC failed to introduce sufficient evidence regarding Thornburg Mortgage’s lending requirements at’ the time of Goldstone’s February 28, 2008, CNBC statements, the SEC points to three Thornburg Mortgage’s reverse repurchase agreements that the Court admitted at trial. See Opposition at 4 (citing Citigroup Global Markets, Inc. and Thorn-burg Mortgage Inc., ISLA Global Master Securities Lending Agreement (dated Aug. 20, 2007)(“Trial Ex. 10”); Master Repurchase Agreement’ between Greenwich Capital Markets, Inc. and Thornburg Mortgage, Inc. (dated Sept. 14, 2007)(“Tri-al Ex. 225”); Master Repurchase Agreement between Credit Suisse First Boston Corporation and Thornburg Mortgage Asset Corporation (dated Sept. 20, 1997)(“Trial Ex. 226”). The SEC contends that myriad other evidence introduced at trial demonstrates that the applicable reverse repurchase agreements required that the margin calls which Thornburg Mortgage received on the morning of February 28, 2008, were to be paid that’ day. See- Opposition at 4. The SEC asserts that this evidence is sufficient to establish Thornburg Mortgage’s lending requirements at the time Goldstone made the CNBC statements and further argues that there is no requirement that each trade agreement be introduced into evidence. See Opposition at 4-5.

The SEC also contests the Defendants’ argument that there is no evidence that Thornburg Mortgage had not met its lending requirements when Goldstone spoke on CNBC. See Opposition at 5. According to the SEC, Goldstone conceded at trial that, among the $158.7 million in margin calls which Thornburg Mortgage received on the morning of February 28, 2008, Thorn-burg Mortgage “didn’t have enough cash available to meet” JP Morgan’s twenty-five million dollar margin call, and, as a result, JP Morgan declared Thornburg Mortgage in default that afternoon or evening. Opposition at 5 (quoting Trial Tr. at 2821:1-7 (Goldstone)). The SEC thereby concludes that Goldstone’s statement made on CNBC that all lending requirements were met was false and misleading. See Opposition at 5-6.

Turning to Goldstone’s morning email to the Investor Relations group, the SEC contests the Defendants’ contention that the SEC introduced no document or testimony showing what particular statements the Investor Relations group members made to any particular investor. See Opposition at 6, The SEC specifically points to Goldstone’s trial testimony that the message points he sent to Investor Relations personnel were consistent with the messages that group reinforced in the market. See Opposition at 6 (citing Trial Tr. at 2828:1-19 (O’Leary)). The SEC also argues that the statement which Goldstone directed the Investor Relations group to communicate—namely, “All margin calls were met. Lenders are fine ...”—was false for the same reasons that Goldstone’s CNBC statement is false. See Opposition at 6-7 (quoting Email from Larry Goldstone to Amy Pell, Suzanne O’Leary Lopez, Allison Yates, re: Stock Price (dated Feb. 28, 2008)(Trial Ex. 152)(“Feb. 28 Goldstone Email re: Stock Price”). Last, the SEC argues that sufficient evidence was introduced to support a conclusion that Gold-stone was the maker of the Investor Relations’ statements, pointing to evidence which . establishes that Goldstone was Thornburg Mortgage’s CEO and that Investor Relations was under his control. See Opposition at 7 (citing Trial Tr. at 1180:19-25 (O’Leary); id. at 2814:1-6 (Goldstone)).

Finally, the SEC argues that, even if there is insufficient evidence to establish that Goldstone’s statements at issue were false, ample evidence was introduced to establish that those statements were misleading. See Opposition at 7. The SEC asserts that Goldstone’s statement that -Thornburg Mortgage had met all of its lending requirements was misleading “when margin calls had been received, those margin calls were due that day, and there was not enough money to pay them.” Opposition at 7,

5. The Defendants’ Reply in Support of Its Renewed Motion for Judgment as a Matter of Law.

The Defendants replied to the SEC’s Opposition.' See Defendants’ Reply in Support of Its Renewed Motion for Judgment as a Matter of Law, filed October 21, 2016, (Doc. 605)(“Reply”). In their Reply, the Defendants assert that any retrial of Claim 8, the auditor deception claim, might result in an inconsistent verdict, because the first jury “already determined that Thornburg did not keep false books and records and that the Form 10-K was not false.” Reply at 1. Regarding their argument that the Court is collaterally estopped from presiding over a retrial of Claim 8, the Defendants restate that “the question before the Court is whether the auditor deception claim has been resolved by ‘necessary implication’ of the first jury verdict.” Reply at 1 (quoting Copar Pumice Co. v. Morris, No. CIV 07-0079 JB/ACT, 2009 WL 5201799, at *10 (D.N.M. Oct. 23, 2009)(Browning, J.), aff'd 639 F.3d 1025 (10th Cir. 2011)). The Defendants emphasize that there is no legal requirement for the Court to consider the “seriousness” of claims to determine if a jury’s finding regarding one claim is preclusive of retrial on another claim. Reply at 3. The Defendants rather stress that factual determinations that are necessarily implied by a jury’s verdict preclude relitigation of the same issues of fact. See Reply at 3. The Defendants also contend that, as a matter of law, the Court may consider jury responses to special interrogatories on the final verdict form when determining collateral estoppel of factual issues on retrial. See Reply at 3 (internal citations omitted).

The Defendants also disregard the jury’s answer “yes” to the special interrogatory on Claim 8 whether Goldstone “ ‘omitted to state or caused to state any material fact necessary to make the statement made, in light of the circumstances under which such statements were made, not misleading, to an accountant?’ ” Final Verdict Form at 16. See Reply at 5. The Defendants argue that, because the jurors did not return a verdict on Claim 8, this factual finding is not binding. See Reply at 5. The Defendants reassert the argument that they made in their Renewed Motion for Judgment that both the jury’s answers to the special interrogatories on Claims 4 and 5, combined with the jury’s verdict on those claims, are pi’eclusive of the facts at issue in Claim 8. See Reply at 4, 5-7; Defendants’ Summary of Rule 13b2-2 Allegations in the SEC’s Closing Arguments and Jury Findings That Dispose of These Allegations at 1-7, filed Oct. 21, 2016 (Doc. 605-l)(“Defendants’ Reply Ex. A.”).

The Defendants also reply to the SEC’s opposition to the Defendants’ arguments that insufficient evidence was introduced at trial regarding Goldstone’s statements to CNBC or his email to Investor Relations to support liability for securities fraud in violation of rule 10b-5. See Reply at 1-2, 8-12. In reply to the SEC’s reference to the litigation of similar sufficiency-of-the-evidence issues at previous procedural junctures, the Defendants contend that their Renewed Motion for Judgment is a distinct challenge brought under rule 50 of the Federal Rules of Civil Procedure, and, therefore, its sufficiency challenge must be evaluated by the evidence presented to the jury at trial. See Reply at 2. The Defendants then reassert that the SEC did not introduce sufficient evidence at trial of Thornburg Mortgage’s lending requirements on February 28, 2008, for a reasonable jury to find that Goldstone made false or misleading statements at the time he appeared on CNBC. See Reply at 9. The Defendants argue that, because the SEC failed to ask Goldstone at trial to what “lending requirements” he was referring during his CNBC statement, the SEC’s assertion that lending requirements must mean margin calls is speculative and lacks sufficient evidentiary support. Reply at 9-10. The Defendants also parse a margin call from a lending requirement, arguing that a lending requirement does equate to a margin call, but rather means that a margin call must be met by a contractual or negotiated deadline. See Reply at 10. With that distinction in hand, the Defendants argue that the SEC did not introduce sufficient evidence to establish that Goldstone made a false or misleading statement at the time he spoke on CNBC. See Reply at 10. Separately, the Defendants advert to evidence introduced at trial that lenders could modify margin calls or that “lenders regularly allowed for payments over time” and, therefore, argue that there is not substantial evidence from which a reasonable jury could conclude that Thornburg Mortgage’s lending requirements “had or had not been met” on February 28, 2008. Reply at 10. The Defendants also point to other general statements about the market that Goldstone made during the CNBC interview and argue that, in the light of those statements, no reasonable jury can conclude that Gold-stone’s statement that Thornburg Mortgage had met its lending requirements was intentionally misleading. See Reply at 10-11.

In their Reply, the Defendants also maintain their argument that no reasonable jury can find Goldstone liable for securities fraud based on statements which he made in a February 28, 2008, email to the Thornburg Mortgage Investor Relations group. See Reply at 11-12. The Defendants