EASTERBROOK, Circuit Judge.

Year after year the Pood and Drug Administration inspected the Diagnostic Division of Abbott Laboratories, found deficiencies in manufacturing quality control, and issued warnings. The Division made efforts to do better, never to the fda’s satisfaction, but until 1999 the fda was willing to accept Abbott’s promises and remedial steps. On March 17, 1999, the. fda sent Abbott another letter demanding compliance with all regulatory requirements and threatening severe consequences. This could have been read as more saber rattling — Bloomberg News revealed the letter to the financial world in June, and Abbott’s stock price did not even quiver — but later developments show that it was more ominous. By September 1999 the fda was insisting on substantial penalties plus changes in Abbott’s methods of doing business. On September 29, 1999, after the markets had closed, Abbott issued a press release describing the fda’s position, asserting that Abbott was in “substantial” compliance with federal regulations, and revealing that the parties were *808engaged in settlement talks. Abbott’s stock fell more than 6%, from $40 to $37.50, the next business day. On November 2, 1999, Abbott and the fda resolved their differences, and a court entered a consent decree requiring Abbott to remove 125 diagnostic products from the market until it had improved its quality control and to pay a $100 million civil fine. Abbott took an accounting charge of $168 million to cover the fine and worthless inventory. The next business day Abbott’s stock slumped $3.50, which together with the earlier drop implied that shareholders saw the episode as costing Abbott (in cash plus future compliance costs and lost sales) more than $5 billion. (Neither side has used the capital asset pricing model or any other means to factor market movements out of these price changes, so we take them at face value.)

Plaintiffs in these class actions under § 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. § 78j(b), and the sec’s Rule 10b-5, 17 C.F.R. § 240.10b-5, contend that Abbott committed fraud by deferring public revelation. The classes comprise all buyers of Abbott’s securities between March 17 and November 2. (One class consists of persons who bought securities in alza, a firm that Abbott proposed to acquire through an exchange of securities and whose market price thus tracked Abbott’s. For simplicity we treat these plaintiffs as purchasers of Abbott stock.) The district judge dismissed the complaints under Fed.R.Civ.P. 12(b)(6) for failure to state a claim on which relief may be granted. 140 F.Supp.2d 894 (N.D.Ill.2001). The market’s non-reaction to Bloomberg’s disclosure shows, the judge thought, that the fda’s letter was not by itself material or that the market price had earlier reflected the news, cf. In re Apple Computer Securities Litigation, 886 F.2d 1109 (9th Cir.1989); Flamm v. Eberstadt, 814 F.2d 1169, 1179-80 (7th Cir.1987); only later developments contained material information, which Abbott disclosed in September and November. Moreover, the judge concluded, plaintiffs had not identified any false or fraudulent statement by Abbott, as opposed to silence in the face of bad news. We are skeptical that these shortcomings justify dismissal for failure to state a claim on which relief may be granted; the judge’s reasons seem more akin to an invocation of Fed.R.Civ.P. 9(b), which requires fraud to be pleaded with particularity, or the extra pleading requirements for securities cases created by the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 78u-4(b)(l). But it is not necessary to decide whether Rule 12(b)(6), Rule 12(c), Rule 9(b), or the Reform Act supplies the best basis of decision. Nor is it necessary to decide whether the news was “material” before the fda’s negotiating position stiffened, to decide whether Abbott acted with the state of mind necessary to support liability under Rule 10b-5, or to address other potential stumbling blocks. What sinks plaintiffs’ position is their inability to identify any false statement — or for that matter any truthful statement made misleading by the omission of news about the fda’s demands.

Much of plaintiffs’ argument reads as if firms have an absolute duty to disclose all information material to stock prices as soon as news comes into then-possession. Yet that is not the way the securities laws work. We do not have a system of continuous disclosure. Instead firms are entitled to keep silent (about good news as well as bad news) unless positive law creates a duty to disclose. See, e.g., Basic, Inc. v. Levinson, 485 U.S. 224, 239 n. 17, 108 S.Ct. 978, 99 L.Ed.2d 194 (1988); Dirks v. sec, 463 U.S. 646, 653-54, 103 S.Ct. 3255, 77 L.Ed.2d 911 (1983); Chiarella v. United States, 445 U.S. 222, *809227-35, 100 S.Ct. 1108, 63 L.Ed.2d 348 (1980); Stransky v. Cummins Engine Co., 51 F.3d 1329, 1331 (7th Cir.1995); Backman v. Polaroid Corp., 910 F.2d 10, 16 (1st Cir.1990) (en banc). Until the Securities Act of 1933 there was no federal regulation of corporate disclosure. The 1933 Act requires firms to reveal information only when they issue securities, and the duty is owed only to persons who buy from the issuer or an underwriter distributing on its behalf; every other transaction is exempt under § 4, 15 U.S.C. § 77d. (No member of either class contends that he purchased securities from Abbott, or an underwriter on Abbott’s behalf, between March 17 and November 2.) Section 13 of the Securities Exchange Act of 1934, 15 U.S.C. § 78m, adds that the seo may require issuers to file annual and other periodic reports— with the emphasis on periodic rather than continuous. Section 13 and the implementing regulations contemplate that these reports will be snapshots of the corporation’s status on or near the filing date, with updates due not when something “material” happens, but on the next prescribed filing date.

Regulations implementing § 13 require a comprehensive annual filing, the Form 10-K report, and less extensive quarterly supplements on Form 10-Q. The supplements need not bring up to date everything contained in the annual 10-K report; counsel for the plaintiff classes conceded at oral argument that nothing in Regulation S-K (the sec’s list of required disclosures) requires either an updating of Form 10-K reports more often than annually, or a disclosure in a quarterly Form 10-Q report of information about the firm’s regulatory problems. The regulations that provide for disclosures on Form 10-Q tell us which items in the annual report must be updated (a subset of the full list), and how often (quarterly).

Many proposals have been made to do things differently — to junk this combination of sale-based disclosure with periodic follow-up and replace it with a system under which issuers rather than securities are registered and disclosure must be continuous. E.g., American Law Institute, Federal Securities Code xxvii-xxviii, § 602 & commentary (1978); Securities and Exchange Commission, Report of the Advisory Committee on the Capital Formation and Regulatory Process 9-14, 36-38 (1996). Regulation S-K goes some distance in this direction by defining identical items of disclosure for registration of stock and issuers’ subsequent reports, and by authorizing the largest issuers to use their annual 10-K reports as the kernels of registration statements for new securities. But Regulation S-K does not replace periodic with continuous disclosure, and the more ambitious proposals to do this have not been adopted.

The ali’s proposal, for example, was embraced by the sec, see 1933 Act Release No. 6242 (Sept. 18, 1980); 1933 Act Release No. 6377 (Jan. 31, 1982), but never seriously pursued, and revisions of Regulation S-K satisfied many of the original supporters of the ali’s proposal. The advisory committee report, prepared by a distinguished group of scholars and practitioners under the leadership of Commissioner Steven M.H. Wallman, did not persuade the sec’s other members and was not taken up by the agency as a legislative plan or even as the basis of a demonstration project. Whatever may be said for and against these proposals, they must be understood as projects for legislation (and to a limited extent for the use of the seo’s rulemaking powers); judges have no authority to scoop the political branches and adopt continuous disclosure under the banner of Rule 10b-5. Especially not under that banner, for Rule 10b-5 condemns only fraud, and a corporation does not commit *810fraud by standing on its rights under a periodic-disclosure system. The Supreme Court has insisted that this judicially created right of action be used only to implement, and not to alter, the rules found in the text of the 1933 and 1934 Acts. See Central Bank of Denver, N.A. v. First Interstate Bank of Denver, N.A., 511 U.S. 164, 173, 114 S.Ct. 1439, 128 L.Ed.2d 119 (1994) (“We have refused to allow [private] 10b-5 challenges to conduct not prohibited by the text of the statute.”); United States v. O’Hagan, 521 U.S. 642, 651, 117 S.Ct. 2199, 138 L.Ed.2d 724 (1997).

Trying to locate some statement that was either false or materially misleading because it did not mention the fda’s position, plaintiffs pointed in the district court to several reports filed or statements made by Abbott before November 2, 1999. All but two of these have fallen by the wayside on appeal. What remain are Abbott’s Form 10-K annual report for 1998 filed in March' 1999 and an oral statement that Miles White, Abbott’s ceo, made at the annual shareholders’ meeting the next month.

Plaintiffs rely principally on Item 303(a)(3)(ii) of Regulation S-K, which provides that registration statements and annual 10-K reports must reveal

any known trends or uncertainties that have had or that the registrant reasonably expects will have a material favorable or unfavorable impact on net sales or revenues or income from continuing operations.

The fda’s letter, and its negotiating demands, are within this description, according to the plaintiff classes. We shall assume that this is so. The 10-K report did state that Abbott is “subject to comprehensive government regulation” and that “[government regulatory actions can result in ... sanctions.” Plaintiffs say that this is too general in light of the fda’s letter and Abbott’s continuing inability to satisfy the fda’s demands. Again we shall assume that plaintiffs are right. But there is a fundamental problem: The 10-K report was filed on March 9, 1999, and the fda’s letter is dated March 17, eight days later. Unless Abbott had a time machine, it could not have described on March 9 a letter that had yet to be written.

Attempting to surmount this temporal problem, plaintiffs insist that Abbott had a “duty to correct” the 10-K report. Yet a statement may be “corrected” only if it was incorrect when made, and nothing said as of March 9 was incorrect. In order to maintain the difference between periodic-disclosure and continuous-disclosure systems, it is essential to draw a sharp line between duties to correct and duties to update. We drew just this line in Stran-sky and adhere to it now. If, for example, the 10-K report had said that Abbott’s net income for 1998 was $500 million, and the actual income was $400 million, Abbott would have had to fix the error. But if the 10-K report had projected a net income of $125 million for the first quarter of 1999, and accountants determined in May that the actual profit was only $100 million, there would have been nothing to correct; a projection is not rendered false when the world turns out otherwise. See Wielgos v. Commonwealth Edison Co., 892 F.2d 509 (7th Cir.1989). Amending the 10-K report to show the results for 1999 as they came in — or to supply a running narrative of the dispute between Abbott and the fda— would update the report, not comet it to show Abbott’s actual condition as of March 9.

Updating documents has its place in securities law. A registration statement and prospectus for a new issue of securities must be accurate when it is used to sell stock, and not just when it is filed. Section 12(a)(2) of the ’33 Act, 15 U.S.C. *811§ 772(a)(2); Regulation S-K, Item 512(a). Material changes in a company’s position thus must be reflected in a registration statement promptly. But this does not imply changes in a 10-K annual report, even when that report is used (as it can be with securities registered on Form S-3, or for a shelf offering under Rule 415) as the principal disclosure document. Instead of changing the 10-K report weekly or monthly, the issuer must file and distribute an addendum to that document bringing matters up to date. See Form S-3, Item 11. Anyway, as we’ve already mentioned, Abbott did not sell any stock to the class members during the period from March 17 to November 2,1999.

As for White’s statements at the annual meeting: he said very little that was concrete (as opposed to puffery), and everything concrete was true. White said, for example:

The outcome [of our efforts] has been growth more than five times faster than the diagnostics market. We expect this trend to continue for the foreseeable future, due to the unprecedented state of our new product cycle. By supplementing our internal investment with opportunistic technology acquisitions, Abbott’s diagnostics pipeline is fuller than ever before.

The statement about past performance was accurate, and the plaintiffs have not given us any reason to doubt that White honestly believed that similar growth would continue, or that White honestly believed “Abbott’s diagnostics pipeline [to be] fuller than ever before.” Even with the benefit of hindsight these statements cannot be gainsaid. Here is where Rule 9(b) pinches: Plaintiffs have done nothing to meet the requirements for pleading fraud with respect to the annual meeting, even if it were possible (which we doubt) to treat as “fraud” the predictive components in White’s boosterism. See DiLeo v. Ernst & Young, 901 F.2d 624 (7th Cir.1990).

Affirmed.

Opinion *1323Justice KAGANdelivered the opinion of the Court.

Before a company may sell securities in interstate commerce, it must file a registration statement with the Securities and Exchange Commission (SEC). If that document either "contain[s] an untrue statement of a material fact" or "omit[s] to state a material fact ... necessary to make the statements therein not misleading," a purchaser of the stock may sue for damages. 15 U.S.C. § 77k(a). This case requires us to decide how each of those phrases applies to statements of opinion.

I

The Securities Act of 1933, 48 Stat. 74, 15 U.S.C. § 77a et seq.,protects investors by ensuring that companies issuing securities (known as "issuers") make a "full and fair disclosure of information" relevant to a public offering. Pinter v. Dahl,486 U.S. 622, 646, 108 S.Ct. 2063, 100 L.Ed.2d 658 (1988). The linchpin of the Act is its registration requirement. With limited exceptions not relevant here, an issuer may offer securities to the public only after filing a registration statement. See §§ 77d, 77e. That statement must contain specified information about both the company itself and the security for sale. See §§ 77g, 77aa. Beyond those required disclosures, the issuer may include additional representations of either fact or opinion.

Section 11 of the Act promotes compliance with these disclosure provisions by giving purchasers a right of action against an issuer or designated individuals (directors, partners, underwriters, and so forth) for material misstatements or omissions in registration statements. As relevant here, that section provides:

"In case any part of the registration statement, when such part became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, any person acquiring such security ... [may] sue." § 77k(a).

Section 11 thus creates two ways to hold issuers liable for the contents of a registration statement-one focusing on what the statement says and the other on what it leaves out. Either way, the buyer need not prove (as he must to establish certain other securities offenses) that the defendant acted with any intent to deceive or defraud. Herman & MacLean v. Huddleston,459 U.S. 375, 381-382, 103 S.Ct. 683, 74 L.Ed.2d 548 (1983).

This case arises out of a registration statement that petitioner Omnicare filed in connection with a public offering of common stock. Omnicare is the nation's largest provider of pharmacy services for residents of nursing homes. Its registration statement contained (along with all mandated disclosures) analysis of the effects of various federal and state laws on its business model, including its acceptance of rebates from pharmaceutical manufacturers. See, e.g.,App. 88-107, 132-140, 154-166. Of significance here, two sentences in the registration statement expressed Omnicare's view of its compliance with legal requirements:

• "We believe our contract arrangements with other healthcare providers, our pharmaceutical suppliers and our pharmacy practices are in compliance with applicable federal and state laws." Id.,at 95.

• "We believe that our contracts with pharmaceutical manufacturers are legally and economically valid arrangements that bring value to the healthcare system and the patients that we serve." Id.,at 137.

*1324Accompanying those legal opinions were some caveats. On the same page as the first statement above, Omnicare mentioned several state-initiated "enforcement actions against pharmaceutical manufacturers" for offering payments to pharmacies that dispensed their products; it then cautioned that the laws relating to that practice might "be interpreted in the future in a manner inconsistent with our interpretation and application." Id.,at 96. And adjacent to the second statement, Omnicare noted that the Federal Government had expressed "significant concerns" about some manufacturers' rebates to pharmacies and warned that business might suffer "if these price concessions were no longer provided." Id.,at 136-137.

Respondents here, pension funds that purchased Omnicare stock in the public offering (hereinafter Funds), brought suit alleging that the company's two opinion statements about legal compliance give rise to liability under § 11. Citing lawsuits that the Federal Government later pressed against Omnicare, the Funds' complaint maintained that the company's receipt of payments from drug manufacturers violated anti-kickback laws. See id.,at 181-186, 203-226. Accordingly, the complaint asserted, Omnicare made "materially false" representations about legal compliance. Id.,at 274. And so too, the complaint continued, the company "omitted to state [material] facts necessary" to make its representations not misleading. Id.,at 273. The Funds claimed that none of Omnicare's officers and directors "possessed reasonable grounds" for thinking that the opinions offered were truthful and complete. Id.,at 274. Indeed, the complaint noted that one of Omnicare's attorneys had warned that a particular contract "carrie[d] a heightened risk" of liability under anti-kickback laws. Id.,at 225 (emphasis deleted). At the same time, the Funds made clear that in light of § 11's strict liability standard, they chose to "exclude and disclaim any allegation that could be construed as alleging fraud or intentional or reckless misconduct." Id.,at 273.

The District Court granted Omnicare's motion to dismiss. See Civ. No. 2006-26 (ED Ky., Feb. 13, 2012), App. to Pet. for Cert. 28a, 38a-40a, 2012 WL 462551, *4-*5. In the court's view, "statements regarding a company's belief as to its legal compliance are considered 'soft' information" and are actionable only if those who made them "knew [they] were untrue at the time." App. to Pet. for Cert. 38a. The court concluded that the Funds' complaint failed to meet that standard because it nowhere claimed that "the company's officers knew they were violating the law." Id.,at 39a. The Court of Appeals for the Sixth Circuit reversed. See 719 F.3d 498 (2013). It acknowledged that the two statements highlighted in the Funds' complaint expressed Omnicare's "opinion" of legal compliance, rather than "hard facts." Id.,at 504(quoting In re Sofamor Danek Group Inc.,123 F.3d 394, 401-402 (C.A.6 1997)). But even so, the court held, the Funds had to allege only that the stated belief was "objectively false"; they did not need to contend that anyone at Omnicare "disbelieved [the opinion] at the time it was expressed." 719 F.3d, at 506(quoting Fait v. Regions Financial Corp.,655 F.3d 105, 110 (C.A.2 2011)).

We granted certiorari, 571 U.S. ----, 134 S.Ct. 1490, 188 L.Ed.2d 374 (2014), to consider how § 11 pertains to statements of opinion. We do so in two steps, corresponding to the two parts of § 11 and the two theories in the Funds' complaint. We initially address the Funds' claim that Omnicare made "untrue statement[s] of ... material fact" in offering its views on legal compliance. § 77k(a);

*1325see App. 273-274. We then take up the Funds' argument that Omnicare "omitted to state a material fact ... necessary to make the statements [in its registration filing] not misleading." § 77k(a); see App. 273-274. Unlike both courts below, we see those allegations as presenting different issues.1In resolving the first, we discuss when an opinion itself constitutes a factual misstatement. In analyzing the second, we address when an opinion may be rendered misleading by the omission of discrete factual representations. Because we find that the Court of Appeals applied the wrong standard, we vacate its decision.

II

The Sixth Circuit held, and the Funds now urge, that a statement of opinion that is ultimately found incorrect-even if believed at the time made-may count as an "untrue statement of a material fact." 15 U.S. C § 77k(a); see 719 F.3d, at 505; Brief for Respondents 20-26. As the Funds put the point, a statement of belief may make an implicit assertion about the belief's "subject matter": To say "we believe X is true" is often to indicate that "X is in fact true." Id.,at 23; see Tr. of Oral Arg. 36. In just that way, the Funds conclude, an issuer's statement that "we believe we are following the law" conveys that "we in fact are following the law"-which is "materially false," no matter what the issuer thinks, if instead it is violating an anti-kickback statute. Brief for Respondents 1.

But that argument wrongly conflates facts and opinions. A fact is "a thing done or existing" or "[a]n actual happening." Webster's New International Dictionary 782 (1927). An opinion is "a belief[,] a view," or a "sentiment which the mind forms of persons or things." Id.,at 1509. Most important, a statement of fact ("the coffee is hot") expresses certainty about a thing, whereas a statement of opinion ("I think the coffee is hot") does not. See ibid.("An opinion, in ordinary usage ... does not imply ... definiteness ... or certainty"); 7 Oxford English Dictionary 151 (1933) (an opinion "rests[s] on grounds insufficient for complete demonstration"). Indeed, that difference between the two is so ingrained in our everyday ways of speaking and thinking as to make resort to old dictionaries seem a mite silly. And Congress effectively incorporated just that distinction in § 11's first part by exposing issuers to liability not for "untrue statement[s]" full stop (which would have included *1326ones of opinion), but only for "untrue statement[s] of ... fact." § 77k(a)(emphasis added).

Consider that statutory phrase's application to two hypothetical statements, couched in ways the Funds claim are equivalent. A company's CEO states: "The TVs we manufacture have the highest resolution available on the market." Or, alternatively, the CEO transforms that factual statement into one of opinion: "I believe" (or "I think") "the TVs we manufacture have the highest resolution available on the market." The first version would be an untrue statement of fact if a competitor had introduced a higher resolution TV a month before-even assuming the CEO had not yet learned of the new product. The CEO's assertion, after all, is not mere puffery, but a determinate, verifiable statement about her company's TVs; and the CEO, however innocently, got the facts wrong. But in the same set of circumstances, the second version would remain true. Just as she said, the CEO really did believe, when she made the statement, that her company's TVs had the sharpest picture around. And although a plaintiff could later prove that opinion erroneous, the words "I believe" themselves admitted that possibility, thus precluding liability for an untrue statement of fact. That remains the case if the CEO's opinion, as here, concerned legal compliance. If, for example, she said, "I believe our marketing practices are lawful," and actually did think that, she could not be liable for a false statement of fact-even if she afterward discovered a longtime violation of law. Once again, the statement would have been true, because all she expressed was a view, not a certainty, about legal compliance.

That still leaves some room for § 11's false-statement provision to apply to expressions of opinion. As even Omnicare acknowledges, every such statement explicitly affirms one fact: that the speaker actually holds the stated belief. See Brief for Petitioners 15-16; W. Keeton, D. Dobbs, R. Keeton, & D. Owen, Prosser and Keeton on the Law of Torts § 109, p. 755 (5th ed. 1984) (Prosser and Keeton) ("[A]n expression of opinion is itself always a statement of ... the fact of the belief, the existing state of mind, of the one who asserts it"). For that reason, the CEO's statement about product quality ("I believe our TVs have the highest resolution available on the market") would be an untrue statement of fact-namely, the fact of her own belief-if she knew that her company's TVs only placed second. And so too the statement about legal compliance ("I believe our marketing practices are lawful") would falsely describe her own state of mind if she thought her company was breaking the law. In such cases, § 11's first part would subject the issuer to liability (assuming the misrepresentation were material).2

*1327In addition, some sentences that begin with opinion words like "I believe" contain embedded statements of fact-as, once again, Omnicare recognizes. See Reply Brief 6. Suppose the CEO in our running hypothetical said: "I believe our TVs have the highest resolution available because we use a patented technology to which our competitors do not have access." That statement may be read to affirm not only the speaker's state of mind, as described above, but also an underlying fact: that the company uses a patented technology. See Virginia Bankshares, Inc. v. Sandberg,501 U.S. 1083, 1109, 111 S.Ct. 2749, 115 L.Ed.2d 929 (1991)(SCALIA, J., concurring in part and concurring in judgment) (showing that a statement can sometimes be "most fairly read as affirming separately both the fact of the [speaker's] opinion and the accuracy of the facts" given to support or explain it (emphasis deleted)). Accordingly, liability under § 11's false-statement provision would follow (once again, assuming materiality) not only if the speaker did not hold the belief she professed but also if the supporting fact she supplied were untrue.

But the Funds cannot avail themselves of either of those ways of demonstrating liability. The two sentences to which the Funds object are pure statements of opinion: To simplify their content only a bit, Omnicare said in each that "we believe we are obeying the law." And the Funds do not contest that Omnicare's opinion was honestly held. Recall that their complaint explicitly "exclude[s] and disclaim[s]" any allegation sounding in fraud or deception. App. 273. What the Funds instead claim is that Omnicare's belief turned out to be wrong-that whatever the company thought, it was in fact violating anti-kickback laws. But that allegation alone will not give rise to liability under § 11's first clause because, as we have shown, a sincere statement of pure opinion is not an "untrue statement of material fact," regardless whether an investor can ultimately prove the belief wrong. That clause, limited as it is to factual statements, does not allow investors to second-guess inherently subjective and uncertain assessments. In other words, the provision is not, as the Court of Appeals and the Funds would have it, an invitation to Monday morning quarterback an issuer's opinions.

III

A

That conclusion, however, does not end this case because the Funds also rely on § 11's omissions provision, alleging that Omnicare "omitted to state facts necessary" to make its opinion on legal compliance "not misleading." App. 273; see § 77k(a).3As all parties accept, whether a statement is "misleading" depends on the perspective of a reasonable investor: The inquiry (like the one into materiality) is objective. Cf. TSC Industries, Inc. v. Northway, Inc.,426 U.S. 438, 445, 96 S.Ct. 2126, 48 L.Ed.2d 757 (1976)(noting that the securities laws care only about the "significance of an omitted or misrepresented fact to a reasonable investor"). We therefore must consider when, if ever, the omission of a fact can make a statement of opinion like Omnicare's, even if literally *1328accurate, misleading to an ordinary investor.

Omnicare claims that is just not possible. On its view, no reasonable person, in any context, can understand a pure statement of opinion to convey anything more than the speaker's own mindset. See Reply Brief 5-6. As long as an opinion is sincerely held, Omnicare argues, it cannot mislead as to any matter, regardless what related facts the speaker has omitted. Such statements of belief (concludes Omnicare) are thus immune from liability under § 11's second part, just as they are under its first.4

That claim has more than a kernel of truth. A reasonable person understands, and takes into account, the difference we have discussed above between a statement of fact and one of opinion. See supra,at 1325 - 1326. She recognizes the import of words like "I think" or "I believe," and grasps that they convey some lack of certainty as to the statement's content. See, e.g.,Restatement (Second) of Contracts § 168, Comment a,p. 456 (1979) (noting that a statement of opinion "implies that [the speaker] ... is not certain enough of what he says" to do without the qualifying language). And that may be especially so when the phrases appear in a registration statement, which the reasonable investor expects has been carefully wordsmithed to comply with the law. When reading such a document, the investor thus distinguishes between the sentences "we believe X is true" and "X is true." And because she does so, the omission of a fact that merely rebuts the latter statement fails to render the former misleading. In other words, a statement of opinion is not misleading just because external facts show the opinion to be incorrect. Reasonable investors do not understand such statements as guarantees, and § 11's omissions clause therefore does not treat them that way.

But Omnicare takes its point too far, because a reasonable investor may, depending on the circumstances, understand an opinion statement to convey facts about how the speaker has formed the opinion-or, otherwise put, about the speaker's basis for holding that view. And if the real facts are otherwise, but not provided, the opinion statement will mislead its audience. Consider an unadorned statement of opinion about legal compliance: "We believe our conduct is lawful." If the issuer makes that statement without having consulted a lawyer, it could be misleadingly incomplete. In the context of the securities market, an investor, though recognizing that legal opinions can prove wrong in the end, still likely expects such an assertion to rest on some meaningful legal inquiry-rather than, say, on mere intuition, however sincere.5Similarly, if *1329the issuer made the statement in the face of its lawyers' contrary advice, or with knowledge that the Federal Government was taking the opposite view, the investor again has cause to complain: He expects not just that the issuer believes the opinion (however irrationally), but that it fairly aligns with the information in the issuer's possession at the time.6Thus, if a registration statement omits material facts about the issuer's inquiry into or knowledge concerning a statement of opinion, and if those facts conflict with what a reasonable investor would take from the statement itself, then § 11's omissions clause creates liability.7

An opinion statement, however, is not necessarily misleading when an issuer knows, but fails to disclose, some fact cutting the other way. Reasonable investors understand that opinions sometimes rest on a weighing of competing facts; indeed, the presence of such facts is one reason why an issuer may frame a statement as an opinion, thus conveying uncertainty. See supra,at 1325 - 1326, 1328. Suppose, for example, that in stating an opinion about legal compliance, the issuer did not disclose that a single junior attorney expressed doubts about a practice's legality, when six of his more senior colleagues gave a stamp of approval. That omission would not make the statement of opinion misleading, even if the minority position ultimately proved correct: A reasonable investor does not expect that everyfact known to an issuer supports its opinion statement.8

*1330Moreover, whether an omission makes an expression of opinion misleading always depends on context. Registration statements as a class are formal documents, filed with the SEC as a legal prerequisite for selling securities to the public. Investors do not, and are right not to, expect opinions contained in those statements to reflect baseless, off-the-cuff judgments, of the kind that an individual might communicate in daily life. At the same time, an investor reads each statement within such a document, whether of fact or of opinion, in light of all its surrounding text, including hedges, disclaimers, and apparently conflicting information. And the investor takes into account the customs and practices of the relevant industry. So an omission that renders misleading a statement of opinion when viewed in a vacuum may not do so once that statement is considered, as is appropriate, in a broader frame. The reasonable investor understands a statement of opinion in its full context, and § 11 creates liability only for the omission of material facts that cannot be squared with such a fair reading.

These principles are not unique to § 11: They inhere, too, in much common law respecting the tort of misrepresentation.9The Restatement of Torts, for example, recognizes that "[a] statement of opinion as to facts not disclosed and not otherwise known to the recipient may" in some circumstances reasonably "be interpreted by him as an implied statement" that the speaker "knows facts sufficient to justify him in forming" the opinion, or that he at least knows no facts "incompatible with [the] opinion." Restatement (Second) of Torts § 539, p. 85 (1976).10When that is so, the Restatement explains, liability may result from omission of facts-for example, the fact that the speaker failed to conduct any investigation-that rebut the recipient's predictable inference. See id., Comment a,at 86; id.,Comment b,at 87. Similarly, the leading treatise in the area explains that "it has been recognized very often that the expression of an opinion may carry with it an implied assertion, not only that the speaker knows no facts which would preclude such an opinion, but that he does know facts which justify it." Prosser and Keeton § 109, at 760. That is especially (and traditionally) the case, the treatise continues, where-as in a registration statement-a speaker "holds himself out or is understood as having special knowledge of the matter which is not available to the plaintiff." Id.,at 760-761 (footnote omitted); see Restatement (Second) of Torts § 539, Comment b,at 86 (noting that omissions relating to an opinion's basis are "particularly" likely to give rise to liability when the speaker has "special knowledge of facts unknown to the recipient"); Smith v. Land and House Property Corp., [1884] 28 Ch. D. 7, 15 (App. Cas.) (appeal taken from Eng.) (opinion of Bowen, L.J.) (When "the facts are not equally known to both sides, then a statement of *1331opinion by the one who knows the facts best ... impliedly states that [the speaker] knows facts which justify his opinion").11

And the purpose of § 11 supports this understanding of how the omissions clause maps onto opinion statements. Congress adopted § 11 to ensure that issuers "tell[ ] the whole truth" to investors. H.R.Rep. No. 85, 73d Cong., 1st Sess., 2 (1933) (quoting President Roosevelt's message to Congress). For that reason, literal accuracy is not enough: An issuer must as well desist from misleading investors by saying one thing and holding back another. Omnicare would ify that statutory requirement for all sentences starting with the phrases "we believe" or "we think." But those magic words can preface nearly any conclusion, and the resulting statements, as we have shown, remain perfectly capable of misleading investors. See supra,at 1328 - 1329. Thus, Omnicare's view would punch a hole in the statute for half-truths in the form of opinion statements. And the difficulty of showing that such statements are literally false-which requires proving an issuer did not believe them, see supra,at 1326 - 1327-would make that opening yet more consequential: Were Omnicare right, companies would have virtual carte blancheto assert opinions in registration statements free from worry about § 11. That outcome would ill-fit Congress's decision to establish a strict liability offense promoting "full and fair disclosure" of material information. Pinter,486 U.S., at 646, 108 S.Ct. 2063; see supra,at 1323.

Omnicare argues, in response, that applying § 11's omissions clause in the way we have described would have "adverse policy consequences." Reply Brief 17 (capitalization omitted). According to Omnicare, any inquiry into the issuer's basis for holding an opinion is "hopelessly amorphous," threatening "unpredictable" and possibly "massive" liability. Id.,at 2; Brief for Petitioners 34, 36. And because that is so, Omnicare claims, many issuers will choose not to disclose opinions at all, thus "depriving [investors] of potentially helpful information." Reply Brief 19; see Tr. of Oral Arg. 59-61.

But first, that claim is, just as Omnicare labels it, one of "policy"; and Congress gets to make policy, not the courts. The decision Congress made, for the reasons we have indicated, was to extend § 11 liability to all statements rendered misleading by omission. In doing so, Congress no doubt made § 11 less cut-and-dry than a law prohibiting only false factual statements. Section 11's omissions clause, as applied to statements of both opinion and fact, necessarily brings the reasonable *1332person into the analysis, and asks what she would naturally understand a statement to convey beyond its literal meaning. And for expressions of opinion, that means considering the foundation she would expect an issuer to have before making the statement. See supra,at 1328 - 1329. All that, however, is a feature, not a bug, of the omissions provision.

Moreover, Omnicare way overstates both the looseness of the inquiry Congress has mandated and the breadth of liability that approach threatens. As we have explained, an investor cannot state a claim by alleging only that an opinion was wrong; the complaint must as well call into question the issuer's basis for offering the opinion. See supra,at 1328 - 1329. And to do so, the investor cannot just say that the issuer failed to reveal its basis. Section 11's omissions clause, after all, is not a general disclosure requirement; it affords a cause of action only when an issuer's failure to include a material fact has rendered a published statement misleading. To press such a claim, an investor must allege that kind of omission-and not merely by means of conclusory assertions. See Ashcroft v. Iqbal,556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)("Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice"). To be specific: The investor must identify particular (and material) facts going to the basis for the issuer's opinion-facts about the inquiry the issuer did or did not conduct or the knowledge it did or did not have-whose omission makes the opinion statement at issue misleading to a reasonable person reading the statement fairly and in context. See supra,at 1328 - 1330. That is no small task for an investor.

Nor does the inquiry such a complaint triggers ask anything unusual of courts. Numerous legal rules hinge on what a reasonable person would think or expect. In requiring courts to view statements of opinion from an ordinary investor's perspective, § 11's omissions clause demands nothing more complicated or unmanageable. Indeed, courts have for decades engaged in just that inquiry, with no apparent trouble, in applying the common law of misrepresentation. See supra,at 1330 - 1331.

Finally, we see no reason to think that liability for misleading opinions will chill disclosures useful to investors. Nothing indicates that § 11's application to misleading factual assertions in registration statements has caused such a problem. And likewise, common-law doctrines of opinion liability have not, so far as anyone knows, deterred merchants in ordinary commercial transactions from asserting helpful opinions about their products. That absence of fallout is unsurprising. Sellers (whether of stock or other items) have strong economic incentives to ... well, sell (i.e., hawk or peddle). Those market-based forces push back against any inclination to underdisclose. And to avoid exposure for omissions under § 11, an issuer need only divulge an opinion's basis, or else make clear the real tentativeness of its belief. Such ways of conveying opinions so that they do not mislead will keep valuable information flowing. And that is the only kind of information investors need. To the extent our decision today chills misleadingopinions, that is all to the good: In enacting § 11, Congress worked to ensure better, not just more, information.

B

Our analysis on this score counsels in favor of sending the case back to the lower courts for decision. Neither court below considered the Funds' omissions theory with the right standard in mind-or indeed, *1333even recognized the distinct statutory questions that theory raises. See supra,at 1324 - 1325. We therefore follow our ordinary practice of remanding for a determination of whether the Funds have stated a viable omissions claim (or, if not, whether they should have a chance to replead).

In doing so, however, we reemphasize a few crucial points pertinent to the inquiry on remand. Initially, as we have said, the Funds cannot proceed without identifying one or more facts left out of Omnicare's registration statement. See supra,at 1331 - 1332. The Funds' recitation of the statutory language-that Omnicare "omitted to state facts necessary to make the statements made not misleading"-is not sufficient; neither is the Funds' conclusory allegation that Omnicare lacked "reasonable grounds for the belief" it stated respecting legal compliance. App. 273-274. At oral argument, however, the Funds highlighted another, more specific allegation in their complaint: that an attorney had warned Omnicare that a particular contract "carrie[d] a heightened risk" of legal exposure under anti-kickback laws. Id.,at 225 (emphasis omitted); see Tr. of Oral Arg. 42, 49; supra,at 1324. On remand, the court must review the Funds' complaint to determine whether it adequately alleged that Omnicare had omitted that (purported) fact, or any other like it, from the registration statement. And if so, the court must determine whether the omitted fact would have been material to a reasonable investor-i.e., whether "there is a substantial likelihood that a reasonable [investor] would consider it important." TSC Industries,426 U.S., at 449, 96 S.Ct. 2126.

Assuming the Funds clear those hurdles, the court must ask whether the alleged omission rendered Omnicare's legal compliance opinions misleading in the way described earlier-i.e., because the excluded fact shows that Omnicare lacked the basis for making those statements that a reasonable investor would expect. See supra,at 1328 - 1329. Insofar as the omitted fact at issue is the attorney's warning, that inquiry entails consideration of such matters as the attorney's status and expertise and other legal information available to Omnicare at the time. See supra,at 1329. Further, the analysis of whether Omnicare's opinion is misleading must address the statement's context. See supra,at 1330. That means the court must take account of whatever facts Omnicare didprovide about legal compliance, as well as any other hedges, disclaimers, or qualifications it included in its registration statement. The court should consider, for example, the information Omnicare offered that States had initiated enforcement actions against drug manufacturers for giving rebates to pharmacies, that the Federal Government had expressed concerns about the practice, and that the relevant laws "could "be interpreted in the future in a manner" that would harm Omnicare's business. See App. 95-96, 136-137; supra,at 1323 - 1324.

* * *

With these instructions and for the reasons stated, we vacate the judgment below and remand the case for further proceedings.

It is so ordered.

Justice SCALIA, concurring in part and concurring in the judgment.

Section 11 of the Securities Act of 1933 imposes liability where a registration statement "contain[s] an untrue statement of a material fact" or "omit[s] to state a material fact necessary to make the statements therein not misleading." 15 U.S.C. § 77k(a). I agree with the Court's discussion of what it means for an expression of *1334opinion to state an untrue material fact. But an expression of opinion implies facts (beyond the fact that the speaker believes his opinion) only where a reasonable listener would understand it to do so. And it is only when expressions of opinion doimply these other facts that they can be "misleading" without the addition of other "material facts." The Court's view would count far more expressions of opinion to convey collateral facts than I-or the common law-would, and I therefore concur only in part.

The common law recognized that most listeners hear "I believe," "in my estimation," and other related phrases as disclaimingthe assertion of a fact. Hence the (somewhat overbroad) common-law rule that a plaintiff cannot establish a misrepresentation claim "for misstatements of opinion, as distinguished from those of fact." W. Keeton, D. Dobbs, R. Keeton, & D. Owen, Prosser and Keeton on Torts § 109, p. 755 (5th ed. 1984) (Prosser & Keeton). A fraudulent misrepresentation claim based on an expression of opinion could lie for the one fact the opinion reliably conveyed: that the speaker in fact held the stated opinion. Restatement of Torts § 525, Comment c,p. 60 (1938). And, in some circumstances, the common law acknowledged that an expression of opinion reasonably implied "that the maker knows of no fact incompatible with his opinion." Id.§ 539(1), at 91. The no-facts-incompatible-with-the-opinion standard was a demanding one; it meant that a speaker's judgment had to "var[y] so far from the truth that no reasonable man in his position could have such an opinion." Restatement of Contracts § 474(b), p. 902, and Comment b(1932). But without more, a listener could only reasonably interpret expressions of opinion as conveying this limited assurance of a speaker's understanding of facts.

In a few areas, the common law recognized the possibility that a listener could reasonably infer from an expression of opinion not only (1) that the speaker sincerely held it, and (2) that the speaker knew of no facts incompatible with the opinion, but also (3) that the speaker had a reasonable basis for holding the opinion. This exceptional recognition occurred only where it was "very reasonable or probable" that a listener should place special confidence in a speaker's opinion. Prosser & Keeton § 109, at 760-761. This included two main categories, both of which were carve-outs from the general rule that "the ordinary man has a reasonable competence to form his own opinion," and "is not justified in relying [on] the ... opinion" of another. Restatement of Torts § 542, Comment a,at 95. First, expressions of opinion made in the context of a relationship of trust, such as between doctors and patients. Second, expressions of opinion made by an expert in his capacity as an expert (for example, a jeweler's statement of opinion about the value of a diamond). These exceptions allowed a listener to deal with those special expressions of opinion as though they were facts. As the leading treatise put it, "the ordinary man is free to deal in reliance upon the opinion of an expert jeweler as to the value of a diamond [or] of an attorney upon a point of law." Prosser & Keeton § 109, at 761. But what reasonable person would assume that a lawyer's assessment of a diamond or a jeweler's opinion on a point of law implied an educated investigation?

The Court's expansive application of § 11's omissions clause to expressions of opinion produces a far broader field of misrepresentation; in fact, it produces almost the opposite of the common-law rule. The Court holds that a reasonable investor is right to expect a reasonable basis for all opinions in registration statements-for example, the conduct of a "meaningful ...

*1335inquiry,"-unless that is sufficiently disclaimed. Ante, at 1328 - 1329, 1330 - 1331, 1332 - 1333. Take the Court's hypothetical opinion regarding legal compliance. When a disclosure statement says "we believe our conduct is lawful," ante,at 1328, the Court thinks this should be understood to suggest that a lawyer was consulted, since a reasonable investigation on this point would require consulting a lawyer. But this approach is incompatible with the common law, which had no "legal opinions are different" exception. See Restatement of Torts § 545, at 102.

It is also incompatible with common sense. It seems to me strange to suggest that a statement of opinion as generic as "we believe our conduct is lawful" conveys the implied assertion of fact "we have conducted a meaningful legal investigation before espousing this opinion." It is strange to ignore the reality that a director might rely on industry practice, prior experience, or advice from regulators-rather than a meaningful legal investigation-in concluding the firm's conduct is lawful. The effect of the Court's rule is to adopt a presumption of expertise on all topics volunteered within a registration statement.

It is reasonable enough to adopt such a presumption for those matters that are required to be set forth in a registration statement. Those are matters on which the management of a corporation are experts. If, for example, the registration statement said "we believe that the corporation has $5,000,000 cash on hand," or "we believe the corporation has 7,500 shares of common stock outstanding," the public is entitled to assume that the management has done the necessary research, so that the asserted "belief" is undoubtedly correct. But of course a registration statement would never preface such items, within the expertise of the management, with a "we believe that." Full compliance with the law, however, is another matter. It is not specifically required to be set forth in the statement, and when management prefaces thatvolunteered information with a "we believe that," it flags the fact that this is not within our area of expertise, but we think we are in compliance.

Moreover, even if one assumes that a corporation issuing a registration statement is (by operation of law) an "expert" with regard to all matters stated or opined about, I would still not agree with the Court's disposition. The Court says the following:

"Section 11's omissions clause, as applied to statements of both opinion and fact, necessarily brings the reasonable person into the analysis, and asks what she would naturally understand a statement to convey beyond its literal meaning. And for expressions of opinion, that means considering the foundation she would expect an issuer to have before making the statement." Ante,at 1332 (emphasis added).

The first sentence is true enough-but "what she [the reasonable (female) person, and even he, the reasonable (male) person] would naturally understand a statement [of opinion] to convey" is not that the statement has the foundation she (the reasonable female person) considers adequate. She is not an expert, and is relying on the advice of an expert-who ought to know how much "foundation" is needed. She would naturally understand that the expert has conducted an investigation that he(or she or it) considered adequate. That is what relying upon the opinion of an expert means.

The common law understood this distinction. An action for fraudulent misrepresentation based on an opinion of an *1336expert*was only allowed when the expression of the opinion conveyed a fact-the "fact" that summarized the expert's knowledge. Prosser and Keeton § 109, at 761. And a fact was actionable only if the speaker knewit was false, if he knewhe did not know it, or if he knewthe listener would understand the statement to have a basis that the speaker knew was not true. Restatement of Torts § 526, at 63-64. Ah!, the majority might say, so a speaker is liable for knowing he lacks the listener's reasonable basis!If the speaker knows-is actually aware-that the listener will understand an expression of opinion to have a specific basis that it does not have, then of coursehe satisfies this element of the tort.

But more often, when any basis is implied at all, both sides will understand that the speaker implied a "reasonable basis," but honestly disagree on what that means. And the common law supplied a solution for this: A speaker was liable for ambiguous statements-misunderstandings-as fraudulent misrepresentations onlywhere he both knew of the ambiguity andintended that the listener fall prey to it. Id.§ 527, at 66. In other words, even assuming both parties knew(a prerequisite to liability) that the expression of opinion implied a "reasonable investigation," if the speaker and listener honestly disagreed on the nature of that investigation, the speaker was not liable for a fraudulent misrepresentation unless he subjectively intended the deception. And so in no circumstance would the listener's belief of a "reasonable basis" control: If the speaker subjectively believes he lacks a reasonable basis, then his statement is simply a knowing misrepresentation. Id.§ 526(a), at 63. If he does not know of the ambiguity, or knows of it, but does not intend to deceive, he is not liable. Id. § 527, at 66. That his basis for belief was "objectively unreasonable" does not impart liability, so long as the belief was genuine.

This aligns with common sense. When a client receives advice from his lawyer, it is surely implicit in that advice that the lawyer has conducted a reasonable investigation-reasonable, that is, in the lawyer's estimation.The client is relying on the expert lawyer's judgment for the amount of investigation necessary, no less than for the legal conclusion. To be sure, if the lawyer conducts an investigation that he does not believe is adequate, he would be liable for misrepresentation. And if he conducts an investigation that he believes is adequate but is objectively unreasonable (and reaches an incorrect result), he may be liable for malpractice. But on the latter premise he is not liable for misrepresentation; all that was implicit in his advice was that he had conducted an investigation he deemed adequate. To rely on an expert's opinion is to rely on the expert's evaluation of how much time to spendon the question at hand.

The objective test proposed by the Court-inconsistent with the common law and common intuitions about statements of opinion-invites roundabout attacks upon expressions of opinion. Litigants seeking recompense for a corporation's expression of belief that turned out, after the fact, to be incorrect can always charge that even though the belief rested upon an investigation *1337the corporation thought to be adequate, the investigation was not "objectively adequate."

Nor is this objective test justified by § 11's absence of a mens rearequirement, as the Court suggests. Ante, at 1330 n. 10. Some of my citation of the common law is meant to illustrate whena statement of opinion contains an implied warranty of reasonable basis. But when it does so, the question then becomes whosereasonable basis. My illustration of the common-law requirements for misrepresentation is meant to show that a typical listener assumes that the speaker'sreasonable basis controls. That showing is not contradicted by § 11's absence of a mens rea requirement.

Not to worry, says the Court. Sellers of securities need "only divulge an opinion's basis, or else make clear the real tentativeness of [their] belief [s]." Ante, at 1332. One wonders what the function of "in my estimation" is, then, except as divulging such hesitation. Or what would be sufficient for the Court. "In my highly tentative estimation?" "In my estimation that, consistent with Omnicare,should be understood as an opinion only?" Reasonable speakers do not speak this way, and reasonable listeners do not receive opinions this way. When an expert expresses an opinion instead of stating a fact, it implies (1) that he genuinely believes the opinion, (2) that he believes his basis for the opinion is sufficient, and (most important) (3) that he is not certain of his result. Nothing more. This approach would have given lower courts and investors far more guidance and would largely have avoided the Funds' attack upon Omnicare's opinions as though Omnicare held those opinions out to be facts.

I therefore concur only in part and in the judgment.

Justice THOMAS, concurring in the judgment.

I agree with the Court that the statements of opinion at issue in this case do not contain an untrue statement of a material fact. 15 U.S.C. § 77k(a); ante, at 1325 - 1327. I write separately because I do not think it advisable to opine, as the majority does, on an additional theory of liability that is not properly before us.

The question whether and under what circumstances an omission may make a statement of opinion misleading is one that we should have left to the lower courts to decide on remand. As the majority acknowledges, that question was never passed on below. See ante, at 1332 - 1333. With good reason: Apart from a few conclusory allegations in their complaint and some pro formareferences to "misleading statements and omissions" in their briefs, respondents did not elaborate on the omissions theory of liability before either the District Court or the Court of Appeals. They certainly did not articulate the theory the majority now adopts until they filed their merits brief before this Court. And it was not until oral argument that they identified a factual allegation in their complaint that mightserve to state a claim under that theory. See ante,at 1332 - 1333. This delay is unsurprising given that, although various Courts of Appeals have discussed the theory, they have been reluctant to commit to it. See MHC Mut. Conversion Fund, L.P. v. Sandler O'Neill & Partners, L.P.,761 F.3d 1109, 1116 (C.A.10 2014)("[I]t is difficult to find many [courts] actually holding a security issuer liable on this basis, ... and ... the approach has been questioned by others on various grounds"); see also ibid.,n. 5.

We should exercise the same caution. This Court rarely prides itself on being a pioneer of novel legal claims, as "[o]urs is a court of final review and not first view."

*1338Zivotofsky v. Clinton,566 U.S. ----, ----, 132 S.Ct. 1421, 1430, 182 L.Ed.2d 423 (2012)(internal quotation marks omitted). Thus, as a general rule, "we do not decide in the first instance issues not decided below." Ibid.(internal quotation marks omitted). This includes fashioning innovative theories of liability as much as it includes applying those theories to the circumstances of the case.

The Court has previously relied on a lower court's failure to address an issue below as a reason for declining to address it here, even when the question was fairly presented in the petition and fully vetted by other lower courts. See, e.g.,CSX Transp., Inc. v. Alabama Dept. of Revenue,562 U.S. 277, 284, n. 5, 131 S.Ct. 1101, 179 L.Ed.2d 37 (2011); see also id.,at 303, n. 3, 131 S.Ct. 1101(THOMAS, J., dissenting). Surely the feature that distinguishes this case-a novel legal theory that is not fairly included in the question presented-counsels more strongly in favor of avoidance.

As Justice SCALIA's concurrence reveals, the scope of this theory of liability is far from certain. And the highly fact-intensive nature of the omissions theory provides an additional reason not to address it at this time. The majority acknowledges that the facts a reasonable investor may infer from a statement of opinion depend on the context. And yet it opines about certain facts an investor may infer from an issuer's legal compliance opinion: that such an opinion is based on legal advice, for example, or that it is not contradicted by the Federal Government. See ante, at 1328 - 1329. These inferences may seem sensible enough in a vacuum, but lower courts would do well to heed the majority's admonition that every statement of opinion must be considered "in a broader frame," ante,at 1330, taking into account all the facts of the statement and its context. Would that the majority had waited for the "broader frame" of an actual case before weighing in on the omissions theory.

LOHIER, Circuit Judge:

The Indiana Public Retirement System, the Indiana State Teachers’ Retirement Fund, and the Indiana State Public Employees’ Retirement Fund, on behalf of themselves and a class of other''Similarly • situated ' investors (“Plaintiffs”), appeal from an order of the United States District Court for the Southern District of New York (Batts, J.) denying their motions to vacate the judgment and to amend their complaint. Plaintiffs sued SAIC, Inc.;1 Walter P. Havenstein, its Chief Executive Officer; Mark W. Sopp, its Chief Financial Officer; and others (collectively, “Defendants”) for securities fraud in violation of Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”), 15 U.S.C. § 788(b), Section 20(a) of the Exchange Act, 15 U.S.C. § 78t(a), and Securities and Exchange Commission (“SEC”) Rule 10b-5, 17 C.F.R. § 240.10b-5. Their lawsuit arose from a series of alleged material misstatements and omissions in SAIC’s public filings regarding its exposure to liability for employee fraud in connection with SAIC’s contract work for New York City’s • CityTime project. On appeal, we address principally four issues arising from Plaintiffs’ motion to file a Proposed Second Amended Complaint (“PSAC”): (1) SAIC’s alleged failure to comply with Generally Accepted Accounting Principles (“GAAP”) by failing to disclose appropriate loss contingencies associated with the CityTime project; in violation of Financial Accounting Standard No. 5 (“FAS 5”); (2) SAIC’s alleged failure to disclose a known trend or uncertainty reasonably expected to have a material impact on its financial condition, in violation of Item 303 of SEC Regulation S-K, 17 C.F.R. § 229.303(a)(3)(ii) (“Item 303”);2 (3) SAIC’s scienter; and (4) among other remaining issues,. SAIC’s allegedly misleading statements regarding its commitment to ethics and integrity contained in its 2011 Annual Report to shareholders.

We conclude that the District Court improperly denied Plaintiffs’ postjudgment motion to amend their FAS 5 and Item 303 claims based on SAIC’s March 2011 Form 10-K. We therefore vacate the District Court’s order denying the motion with respect to those claims and remand' for further proceedings • consistent - with this opinion. We-affirm the judgment of the District Court with respect to Plaintiffs’ remaining claims.

BACKGROUND

We accept as true the facts alleged in the PSAC because Plaintiffs appeal from the denial of leave to amend on the ground of futility. See In re Advanced Battery Techs., Inc., 781 F.3d 638, 641-42 (2d Cir.2015).

*891. ■ Facts

SAIC provided defense, intelligence, homeland security, logistics, and other services primarily to government agencies. In 2000 SAIC became the prime government contractor on a project with New York City--to develop and implement an automated timekeeping program known as CityTime for employees of various City agencies. SAIC anticipated that the project, if successful, would attract business from municipalities across the ■ United States with similar1 timekeeping requirements and would lead to contracts unrelated to timekeeping in the City. As a result, SAIC kept a close eye on the project’s progress. ■ - . -.

In 2002 SAIC hired Gerard Denault as Deputy Program Manager in charge of the CityTime project. In 2003 Denault enlisted Technodyne, a small, - relatively unknown company, to provide staffing serr vices on the project, but the relationship soon gave rise to an elaborate kickback scheme in which Technodyne illegally paid Denault and Carl Bell (SAIC’s Chief Systems Engineer) for each hour a Techno-dyne consultant or subcontractor worked on CityTime. The scheme encouraged De-nault and Bell to hire more Technodyne workers than the project required and !to inflate billable hours and hourly rates.

Although SAIC initially suffered large losses under the CityTime contract, the contract became profitable in 2006 after Denault negotiated an amendment to the contract that transferred the risk of any cost overruns to the City. As a result óf the amendment and the cost overruns associated with the kickback scheme, SAIC billed the City approximately $635 million for CityTime through May 2011, well over the $63 million that the City initially budgeted for-the contract.

By late 2010, when the scheme began to unravel, SAIC had removed Denault from the CityTime project, placed him on administrative leave, and hired' an outside law firm to conduct an internal investigation of possible fraud with the help of SAIC’s internal auditors, who were tasked with ' reviewing Denault’s, timekeeping practices. ^ At' the same time, then-Mayor Michael Bloomberg announced that he was reevaluating SAIC’s role in the CityTime project and reviewing whether to seek recovery of the City’s payments to SAIC in connection with that project. On March 9, 2011, SAIC’s audit team reported the results‘of its findings regarding Denault’s improper timekeeping practices to SAIC.

Notwithstanding the audit team’s findings, SAIC’s Form 10-K, filed on March 25, 2011, and .certified by Sopp and Haven-stein, did not disclose SAIC’s potential liability related to the CityTime project, To the contrary, in a separate Annual Report to shareholders that same month, SAIC touted its commitment- to high standards of “ethical performance and integrity.” Joint App’x 252. By the end of May 2011, though, Denault, Bell, the Technodyne principals, and others were charged in a federal criminal complaint with defrauding the City.3 The .charges, together with the results of the. internal investigation from March 2011, prompted SAIC to fire De-nault in May 2011 and offer to repay the City the amount he had billed after the 2006 amendment of the .CityTime contract — a total of $2.5 million. .

Thereafter, in a Form 8-K filed with the SEC on June 2, 2011, SAIC finally dis*90closed that, the United States Attorney’s Office for the Southern- District of New York (the “Government”) and the New York City Department of Investigation (“DOI”) were conducting a joint criminal investigation into the CityTime contract. The ’8-K further disclosed that SAIC had billed a total of $635 million for the City-Time project, that it had $40 million in outstanding receivables, that Denault had been arrested for fraud, and that SAIC had offered to refund the City the $2.5 million that Denault billed as part of the kickback scheme with Technodyne. Finally, the 8-K explained that Mayor Bloom-berg had

indicated that the City intends to pursue tlie recovery of costs associated with the . CityTime,program that the City’s investigation reveals were improperly charged to the City.'The City has not filed any claim against the Company or otherwise requested reimbursement or return of payments previously made to the Company and the Company has not recorded any liabilities relating to this contract other than the approximately $2.5 million "it offered to refund. ■ However, there is a reasonable possibility of additional exposure to loss that is not currently estimable if there is an adverse outcome. An adverse outcome of any of these investigations may result in non-payment of amounts owed to the Company, a demand for reimbursement of other amounts previously received by the Company under the contract, claims for additional damages, and/or fínes -and penalties, which could have a material adverse effect on the Company’s consolidated financial position, results of operations and cash flows.

Joint App’x 254-55.

In addition to filing the 8-K on June 2, 2011, SAIC held a conference call with analysts and investors to discuss SAIC’s earnings. During the call, Havenstein referred investors to the 8-K for detailed information about the CityTime project and the ongoing criminal investigation. Similarly, on June 3, 2011, SAIC filed a Form 10-Q that repeated the representations made in the 8-K about the project.

On July 1, 2011, SAIC filed, a second 8-K that included a letter from Mayor Bloomberg formally demanding that SAIC reimburse -the City in the approximate amount of $600 million. On August 31, 2011, SAIC issued a press release announcing losses for the fiscal period ending July 31, 2011, due in part to the winding down of the CityTime contract and “probable” restitution to the City for wrongful conduct. Joint App’x 260. From June 2, 2011, when SAIC first disclosed the existence of a criminal investigation and the possible magnitude of its reimbursement to the City, to September 1, 2011, the day after it announced the termination of the CityTime contract, SAIC’s stock price fell from $17.21 to $12.97 per 'share.

In March 2012 SAIC entered into a deferred prosecution agreement with the Government and the DOI, pursuant to which SAIC agreed to reimburse the City approximately $500.4 million and to forfeit $40 million in unpaid, receivables. SAIC also agreed to cooperate with .the Government’s investigation of the .CityTime fraud and to issue, a “Statement of Responsibility” in which it acknowledged that it had defrauded the City through its managerial employees. SAIC admitted, among other things, that.it should have supervised De-nault’s activities, controlled the cost of the project, addressed concerns about its relationship with Technodyne, and properly investigated an early anonymous internal complaint about Denault’s relationship with Technodyne on-the project.

*912. Procedural History

Plaintiffs filed this lawsuit against SAIC and the individual defendants under Section 10(b) and Section 20(a) of the Exchange Act. As relevant here, they claiméd' that SAIC’s March and June 2011 SEC filings on Forms 10-K, 10-Q, and 8-K failed to disclose SAIC’s potential liability arising out of the CityTime fraud or known trends or uncertainties associated with the fraud, as required by FAS 5 and Item 303. Plaintiffs also claimed that the March 2011 Form 10-K contained misstatements regarding the efficacy of SAIC’s internal controls, that SAIC’s 2011 Annual Report contained misleading statements regarding SAIC’s commitment to ethics and integrity, and that in its June 2011 conference call, SAIC misrepresented its potential liability for the CityTime project.

By order dated September 30, 2013 (the “September 2013 Order”), the District Court denied Defendants’ motions to dismiss Plaintiffs’ claims alleging violations of FAS 5 and Item 303 on the March 2011 Form 10-K,, but granted Defendants’ motions to dismiss with respect to most of Plaintiffs’ other claims for failure to state a claim. In re SAIC, Inc. Sec. Litig. (SAIC I), No. 12-CV-1353 (DAB), 2013 WL 5462289, at *16 (S.D.N.Y. Sept. 30, 2013). It granted Plaintiffs leave to amend, within forty-five days, a subset of the dismissed claims, specifically (1) the internal control claim based on the March 2011 Form 10-K and (2) the claims against all of the individual defendants except Denault, Id. at *17. Plaintiffs elected to forgo amending their complaint to replead those claims within the forty-five-day window, deciding instead to proceed with the surviving FAS 5 and Item 303 claims relating to SAIC’s March 2011 Form 10-K.

SAIC, by contrast, moved the District Court to reconsider its decision not to dismiss Plaintiffs’ FAS 5 and Item 303 claims based on the March 2011 Form 10-K. On January 30, 2014, the District Court granted SAIC’s motion and immediately entered judgment dismissing Plaintiffs’ remaining claims with prejudice..(the “January 2014 Order”). In re SAIC, Inc. Sec. Litig. (SAIC II), No. 12-CV-1353 (DAB), 2014 WL 407050, at *1 (S.D.N.Y. Jan. 30, 2014).

On March 4, 2014, Plaintiffs moved to vacate or to obtain relief from the judgment pursuant to Rules 59(e) and 60(b) of the Federal Rules of Civil Procedure and moved under Rule 15(a) for leave to file a proposed amended complaint in the form of the PSAC. As relevant here, the PSAC alleged the following additional facts: (1) SAIC was aware of the Government’s criminal investigation of Denault by the end of December 2010 and had agreed to advance Denault’s legal fees in connection with the investigation and any criminal proceeding that emerged; (2) the December 2010 criminal complaint suggested that SAIC had engaged in improper conduct; (3)-.by December 19, 2010, SAIC had initiated an internal investigation of Denault’s timekeeping practices; (4) Mayor Bloom-berg announced in a press release (December 16, 2010) and in a Daily News article (December 20, 2010) that he was reevaluating. SAIC’s role in the CityTime project and reviewing all payments- the City made with a goal of recoveririg funds from SAIC; (5) SAIC removed Denault from the CityTime project and placed him on administrative leave on December 21, 2010; (6) the New York State Comptroller’s Office and the City Mayor’s Office each rejected contract awards to SAIC in December 2010 based partly on the brewing controversy surrounding the CityTime project; (7) SAIC interviewed Bell about the fraud allegations on January 24, 2011, the day Bell resigned from SAIC; (8) on February 10, 2011, the Government and *92the DOI announced the filing of an indictment in connection with-a fraud scheme involving CityTime; (9) Bell was subpoenaed concerning CityTime, and SAIC agreed to advance his legal fees in connection with the criminal matter on February 11, 2011; and (10) SAIC’s audit team issued a memorandum regarding Denault’s improper timekeeping practices on March 9,2011.

On September 30, 2014, the District Court denied Plaintiffs’ motions for relief from judgment, concluding that any amendment as reflected in the PSAC would be futile.4 In re SAIC, Inc. Sec. Litig. (SAIC III), No. 12-CV-1353 (DAB), 2014 WL 4953614, at *4 (S.D.N.Y. Sept. 30, 2014).

This appeal followed.

■ DISCUSSION

“[A] party seeking to file an amended complaint postjudgment must first have the judgment vacated or set aside pursuant to Rules 59(e) or 60(b).”5 Williams v. Citigroup Inc., 659 F.3d 208, 213 (2d Cir.2011). Rule 60(b)(6) authorizes a court to grant relief from a final judgment for “any ... reason that justifies relief.” Fed.R.Civ.P. 60(b)(6). We have explained that “in view of the provision in [R]ule 15(a) that leave to amend shall be freely given when justice so requires, it might be appropriate in a proper, case to take into account the nature of the proposed amendment in deciding whether to vacate .the previously entered judgment.” Williams, 659 F.3d at 213 (quotation marks omitted).

Here, the District Court denied leave to amend under Rule 60(b)(6) solely on the ground that amendment (in the form of the PSAC) would be futile,6 a determination that we review de novo. City of Pontiac Policemen’s & Firemen’s Ret. Sys, v. UBS AG, 752 F.3d 173, 188 (2d Cir.2014). We assess futility as we would a motion to dismiss, determining whether the proposed complaint contains “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). In this case, because the PSAC alleges securities fraud, it must also satisfy the heightened pleading requirements of the Private Securities Litigation Reform Act (“PSLRA”), 15 U.S.C. § 78u-4(b)(1)-(2), and Rule 9(b) of the Federal Rules of Civil Procedure. ECA, Local 134 IBEW Joint Pension Tr. *93 of Chi. v. JP Morgan Chase Co., 553 F.3d 187, 196 (2d Cir.2009). The PSAC therefore must allege with particularity facts' that give rise to “a strong inference” that SAIC acted consciously and recklessly in omitting or misrepresenting financial information. Id. at 198.

On appeal, Plaintiffs elected to .substantially shorten the class period and affirma-, tively waived any challenge to the District Court’s dismissal of claims arising out of alleged false statements, omissions, or other violations of the securities laws that occurred prior to March 2011. See Oral Argument Tr. at 4. We therefore affirm the District Court’s dismissal of those claims, and in the remaindér of this opinion we focus only on claims arising from misstatements and omissions during the shorter class period from March 23, 20Ü to September 1, 2011.

1, Plaintiffs’ FAS 5 Claim Based on the March 2011 Form .10-K .

To succeed on a claim under Section 10(b) of the Exchange Act and Rule 10b-5, “a plaintiff must allege that [each] defendant '(1) made misstatements' or omissions of material fact, (2) with scien-ter, (3); in connection with the purchase or sale of securities, (4) upon which the plaintiff relied, and (5) that the plaintiff’s reliance was the proximate eause.of its injury.” ATSI Commc’ns, Inc. v. Shaar Fund, Ltd., 493 F.3d 87, 105 (2d Cir.2007). And while , “[financial statements .,. which are not prepared,in accordance;with [GAAP are] presum[ptiyely] .. .■ misleading or inaccurate,”. 17 C.F.R. § 210.4-01(a)(1), “allegations of GAAP violations or accounting irregularities, standing alone, are insufficient to state a securities fraud claim.” Novak v. Kasaks, 216 F.3d 300, 309 (2d Cir.2000). “Only where such allegations are coupled with evidence of corresponding fraudulent intent might they bé sufficient.” Id. (quotation marks omitted).

Plaintiffs allege that SAIC violated GAAP by ‘failing to comply with FAS 5, which requires the issuer to disclose a loss contingency when a loss is a “reasonable possibility,” meaning that it is “more than remote but less than likely.” Financial Accounting Standards Board, Statement of Financial Accounting Standards No. 5, Accounting for Contingencies ¶¶ 3, 10 (1975) (hereinafter FAS Board, Statement of FAS 5). Here, Plaintiffs assert that SAIC failed to disclose the loss contingency related to the- CityTime fraud in SAIC’s March 2011 Form 10-K;

At' the outset, we note that the District Court appears to have misunderstood the standard applicable to claims under FAS 5 when it held that FAS 5 does not require disclosure “unless it is considered probable that a claim will be- asserted.” SAIC II, 2014 WL 407050, at *3 (emphasis added) (quotation marks-omitted). The “probability” standard applies in lieu of the -“reasonable possibility” standard only if the loss contingency arises from “an unasserted claim or assessment when there has been no manifestation by a potential claimant of an awareness of. a possible claim or assessment.” . FAS Board, Statement of FAS 5 ¶ 10 (emphasis added). But in this case, the (“reasonable possibility” standard applies in view; of the PSAC’s allegation that by March 2011 the City had manifested an awareness of a possible, sizeable claim against SAIC. With that standard in mind, we. turn to the allegations in the PSAC relevant to the March 2011 Form 10-K.

- By the time SAIC filed that 10-K, the PSAC alleges, the CityTime criminal investigation was as focused on SAIC as it was on SAIC’s individual employees; the December 20Í0 criminal complaint against individuals involved in the CityTime project alluded to SAIC’s improper actions; *94Denault had been interviewed by prosecutors, and both SAIC and Denault received a grand jury subpoena for the production of documents related to the CityTime project; Mayor Bloomberg announced a reevaluation of SAIC’s role in the CityTime project, including a full review of all payments the City had made to SAIC; and SAIC agreed to pay Denault’s and Bell’s legal fees associated with any criminal proceedings. Moreover, the PSAC alleged that by March 9, 2011, when SAIC received the results of its internal investigation about possible fraud, SAIC was aware not only .of Denault’s wrongdoing but also its own potential liability to the City.

For these reasons we hold that the PSAC adequately alleged that SAIC violated FAS 5 by failing to disclose a loss contingency in its March 201110-K arising from the City’s manifest awareness of a possible material claim against SAIC.

2. Plaintiffs’ Item 303 Claim Based on the March 2011 Form 10-K

Wé next consider whether the PSAC adequately pleaded a violation of Item 303, which imposes specific “disclosure requirements on companies filing” reports on SEC Forms 10-K and 10-Q. Stratte-McClure v. Morgan Stanley, 776 F.3d 94, 101 (2d Cir.2015). As relevant here, Item 303 requires that SAIC’s 10-K “[djescribe any known trends or uncertainties that have had dr that the registrant reasonably expects will have a material favorable or unfavorable impact on net sales or revenues or income from continuing operations.” 17 C.F.R. § 229.303(a)(3)(ii).7 According to the SE'C’s interpretive release regarding Item 303, “disclosure [under Item 303] is necessary ‘where a trend, demand, commitment, event or uncertainty is both presently known to management and reasonably likely to have material effects on the registrant’s financial conditions or results of operations.’ ” Stratte-McClure, 776 F.3d at 101 (quoting Management’s Discussion and Analysis of Financial Condition and Results of Operations, Securities Act Release No. 6835, Exchange Act Release No. 26,831, Investment Company Act Release No. 16,961, 43 SEC Docket 1330 (May 18, 1989) (hereinafter SEC’s Interpretive Release)).

The PSAC alleges that SAIC violated Item 303 by failing to disclose: “(i) that SAIC had overbilled [the City] hundreds of millions of dollars on CityTime over a multi-year period; and (ii) that SAIC’s overbilling practices subjected it to numerous undisclosed risks, including monetary risks and reputational risks, particularly because government agencies are SAIC’s primary customers and any harm to its reputation, and/or relationships with such agencies would adversely affect its current business, as well as its future revenues and growth prospects.” Joint App’x 230,

SAIC makes two principal arguments in defense of the District Court’s conclusion that Plaintiffs’ Item 303 claim was inadequately pleaded. First, it argues that it must actually have known of the relevant uncertainty at the time of the March 2011 filing, but that Plaintiffs failed to plead that SAIC actually knew then about the scheme. Second, it insists that the loss of the CityTime contract was not material to SAIC’s operations as a whole.

*95We have never directly addressed whether Item 303 requires that a company actually know or merely should have known of the relevant trend, event, ■ or uncertainty in order to be liable for failing to disclose it. Instead, we appear to have assumed, without deciding, that Item 303 required an allegation or showing of actual knowledge rather than a lesser standard of recklessness or negligence. In Panther Partners, for example, we held that the complaint adequately alleged that defects in the defendant corporation’s semiconductor chips “constituted a known trend or uncertainty that [the defendant] reasonably expected would have a material unfavorable impact on revenues or income.” Panther Partners Inc. v. Ikanos Commc’ns, Inc., 681 F.3d 114, 121 (2d Cir.2012). We did not separately consider whether the defendant actually had to know about the existing financial uncertainty associated with the defect. Id.; see also Litwin v. Blackstone Grp., L.P., 634 F.3d 706, 716 (2d Cir.2011) (concluding that, where it was undisputed that “the downward trend in the real estate market was already known and existing at the time of the [initial public offering], ... the sole remaining issue [was] whether-the effect of the ‘known’ information was ‘reasonably likely to be material”).

The plain languagé of Item 303 confirms our previous assumption that it requires the registrant’s actual knowledge of the relevant trend or uncertainty. Item 303 demands that the registrant “[d]e-scribe any known trends or uncertainties” and also requires disclosure where “the registrant knows of events that will cause a material change in the relationship between costs. and revenues,” such as a “known future increase[] in costs of labor.” 17 C.F.R. § 229.303(a)(3)(h) (emphases added). The SEC’s interpretation of .Item 303 further confirms this plain-language reading of Item 303, insofar as it advises that the trends or uncertainties must be “presently known to management.” SEC’s Interpretive Release (emphasis added). We therefore hold that Item 303 requires the registrant to disclose only those trends, events, or uncertainties that it actually knows of when it files the relevant report with the SEC. It is not enough that it should have known of the existing trend,, event, or uncertainty.

Here, the PSAC’s allegations support a strong'inference that SAIC actually knéw (1) about the CityTime fraud before filing its Form 10-K on March 25, 2011, and (2) that it could be implicated in the fraud and required to repay the City the revenue generated by the CityTime contract.8 Moreover, The PSAC plausibly alleges that, in December 2010, as a result of the CityTime fraud, both the City and New York State rejected pending contract awards to SAIC valued at more than $150 million. Exposure of the fraud also jeopardized SAIC’s existing or future relationships with other governmental entities that accounted for a significant amount of its revenue. See Panther Partners Inc., 681 F.3d at 121. Indeed, the PSAC alleges, SAIC anticipated that the potential sale of CityTime’s timekeeping software to other municipalities presented a “market opportunity valued [internally] at approximately $2 billion.”' Joint App’x 134. SAIC'was aware of the fraud by late March 2011 but *96was uncertain about its likely effect on SAIC’s current and future revenues. Under those alleged circumstances, SAIC was required under Item 303 to “disclose the manner in which th[at] then-known trend[], event[], or uncertainly] might reasonably be expected to materially impact” SAIC’s future revenues. Litwin, 634 F.3d at 719.

We next consider SAIC’s argument that the loss of the CityTime contract was ultimately not material in view of the fact that it was a single contract out of SAIC’s more than 10,000 ongoing contracts and that it was worth a fraction of SAIC’s yearly revenues ($635 million compared to $10 billion). We reject SAIC’s materiality argument, which asks us to consider quantitative factors only in the narrowest light in determining the financial impact of losing the CityTime project due to the fraud, and to otherwise ignore qualitative factors. See id. at 717-18.

When a district court is in effect faced with a motion to dismiss a complaint, we have cautioned that “[b]ecause materiality is a mixed question of law and fact, in the context of a [Rule] 12(b)(6) motion, ‘[the] complaint may not properly be dismissed ...' on the ground that the alleged • misstatements or omissions are not material unless they are so obviously unimportant to a reasonable investor that reasonable minds could not differ on the question - of their importance.’” ECA, 553 F.3d at 197 (quoting Ganino v. Citizens Utils. Co., 228 F.3d 154, 162 (2d Cir.2000)). Here, as we have just observed, the PSAC alleges that SAIC 'anticipated that the potential sale of OityTime’s timekeeping software to other municipalities presented a “market opportunity valued [internally] at approximately $2 billion” — twenty percent of its yearly revenue. The PSAC also points to SAIC’s possible exposure to significant civil and even criminal liability arising from the submission of fraudulent time and billing records! to the City and the resulting risk of loss of revenue from future contracts for CityTime projects or debarment from other government contracts altogether. The seriousness of the CityTime fraud and the alleged importance of the CityTime project to SAIC’s future presence in the City and its ability to sell similar services to other municipalities aroúnd the United States makes us 'reluctant to conclude at this stage that the alleged misstatements were “so obviously unimportant” either quantitatively or qualitatively that they could not be material.

3. Scienter

Next, we consider whether the plaintiffs have plausibly alleged that SAIC acted with the requisite scienter when it violated FAS 5 and Item 303 in connection with its March 2011 Form 10-K. In other words, does the PSAC allege “facts to show ... strong circumstantial evidence of conscious misbehavior or recklessness” on SAIC’s part? ECA,. 553 F.3d at 198. It does. If credited, the allegations in the PSAC strongly suggest that by March 9, 2011, when SAIC received the results of its internal investigation but before it filed its 10-K, SAIC knew about Denault’s kickback scheme, the extent of the CityTime fraud, and, as we have already explained, that it risked civil and criminal fines and penalties, let alone losing a significant number of current and future government contracts. We conclude that the allegations support the inference that SAIC acted with at least, a reckless disregard óf a known or obvious duty to disclose when, as alleged, it omitted this material information from its March 2011 10-K in violation of FAS 5 and Item 303. - '

SAIC responds that it is simply implausible that it (or, for that matter, any of the defendants) would deliberately conceal the *97“misconduct of rogue employees for just over two months, from the filing of the 10-K on March 25 until [SAIC’s] disclosures on June 2, 2011,” because the benefits of a brief concealment would be low. Appellee’s Br. 53. But this “argument confuses expected with realized benefits.” Makor Issues & Rights, Ltd. v. Tellabs Inc., 513 F.3d 702, 710 (7th Cir.2008). For it is “cogent and at least as compelling as any opposing inference of nonfraudulent intent,” Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 314, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007), to infer that at the time it filed its 10-K in March 2011, SAIC believed it had more time before prosecutors would reveal its role in the Scheme' and before the City formally requested reimbursement; and if SAIC believed that it had more time, then “the benefits of concealment might [have] exceeded] the costs” as of March 2011. Tellabs, 513 F.3d at 710. In fact, at that time, it was unclear when and to what degree SAIC’s role in the fraud would be made public. The PSAC’s theory, then — that the Government and the City uncovered SAIC’s role in the fraud sooner than SAIC expected and. compelled an earlier-than-expected disclosure in June 2011 — is hardly implausible. ,;

In sum, we disagree with the District Court’s conclusion that amending the complaint to include the FAS 5 and Item 303 claims based on the March 2011 10-K would be futile. ■

4. Plaintiffs’Remaining Claims

We briefly address Plaintiffs’ remaining claims on appeal.

First, the District Court dismissed with prejudice the FAS 5 claim based on SAIC’s June 2011 Form 8-K and then refused to grant leave, to amend the claim in the PSAC. See SAIC I, 2013 WL 5462289, at *10-11; SAIC III, 2014 WL 4953614, at *4. We agree with the District Court that amendment of this claim would be futile, notwithstanding the new facts alleged in the PSAC. SAIC’s June 2011 Form 8-K adequately disclosed the total amount that SAIC billed the City under the CityTime project','-the $40 million in outstanding receivables, Denault’s arrest for fraud, SAIC’s subsequent $2.5 million reimbursement offer to the City, and the “reasonable possibility” of additional exposure to loss from “a demand for reimbursement of other amounts.” Joint App’x 254—55. 'Plaintiffs''failed to identify in their - complaint any additional disclosures SAIC should have- made in the' 8-K' to more accurately portray the extent of SAIC’s exposure to liability from the project.

Second, Plaintiffs challenge the District Court’s dismissal of their claims that SAIC’s 2011 Annual Report contained materially false statements about SAIC’s commitment to ethics, and integrity. In particular, the PSAC points to representations in. the Annual Report regarding SAIC’s “culture of high ethical standards, integrity, operational excellence, and customer satisfaction” .and its “reputation for upholding the highest standards of personal integrity, and business conduct.” Joint App’x 252. We affirm the District Court’s dismissal of the claims based on these representations for substantially the reasons provided by the District Court. See SAIC I, 2013 WL 5462289, at *13. On appeal, Plaintiffs árgue that these general statements, while typically not actionable, are actionable in this context because Defendants were aware of facts undermining the positivé statements about SAIC’s commitment to ethics and integrity. But “Plaintiffs’ claim that these statements were knowingly and verifiably false when made does not cure their generality, which is what prevents them from rising to’the *98level of materiality required to form the basis for assessing a potential investment.” City of Pontiac Policemen’s & Firemen’s Ret. Sys., 752 F.3d at 183; see also ECA, 553 F.3d at 206 (“No investor would take such statements seriously in assessing a potential investment, for the simple fact that almost every investment bank makes these statements.”). We cannot distinguish the statements in the Annual Report from the statements at issue in ECA, for example, in which we referred to representations in an SEC filing about .a bank’s reputation for integrity as “no more than ‘puffery which does not give rise to securities violations,” and, suggested that such statements are typically “too general to cause a reasonable investor to rely upon them,” in part because an investor “would not depend on [the statements] as a guarantee that [the company] would never take a step that might adversely affect its reputation.” ECA, 553 F.3d at 206. This is not to say that statements about a company’s reputation for integrity or ethical conduct can never give rise to a securities violation. Some statements,“ in context, may amount to more than “puffery” and may in some circumstances violate the securities laws: for example, a company’s specific statements that emphasize its reputation for integrity or ethical conduct as central to its financial condition or that are cíéarly designed to distinguish the company from other specified companies in the same industry.

Finally, we affirm the District Court’s dismissal of Plaintiffs’ internal control claim based on the March 2011 Form 10-K and their claims against Sopp and Haven-stein. In initially dismissing these claims without prejudice in its September 2013 order, the District Court granted Plaintiffs an opportunity to amend their complaint within forty-five days, but Plaintiffs, without explanation, failed to do so. Under the circumstances, Plaintiffs’ failure to comply with the District Court’s reasonable schedule was a legitimate reason to dismiss those claims with prejudice.9

CONCLUSION

For the foregoing reasons, we VACATE the judgment of the District Court with respect to Plaintiffs’ FAS 5 and Item 303 claims based on SAIC’s March 2011 Form 10-K and REMAND for further proceedings consistent with this opinion. We AFFIRM the judgment of District Court with respect to Plaintiffs’ other claims.