In a class action securities-fraud lawsuit against Diebold, Inc., brought by investors alleging that between 2003 and 2005 Diebold engaged in a series of schemes to prematurely recognize revenue in order to inflate the price of its stock, dismissal of the lawsuit for failure to state a claim is affirmed where: 1) plaintiffs' request for remand is unnecessary as the record reflects that the district court ultimately applied the correct pleading standard; 2) neither the complaint nor the proposed second amended complaint states with particularity facts giving rise to a strong inference that the defendants acted with the required state of mind; and 3) any inference of scienter is not cogent as required by Tellabs, but speculative and supported only by general and conclusory allegations that fail to connect the defendants to the alleged scheme.
Argued: October 14, 2009
Decided and Filed: December 22, 2009
Opinion by Circuit Judge Gilman
For Appellant: Geoffrey M. Johnson, Scott & Scott LLP
For Appellee: John M. Newman, Jr., Jones Day