                            NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                         FILED
                           FOR THE NINTH CIRCUIT                            MAY 24 2012

                                                                       MOLLY C. DWYER, CLERK
OMAR G. SCARBOROUGH and GAY E.                   No. 11-55313            U .S. C O U R T OF APPE ALS

SCARBOROUGH, Trustees of The
Scarborough Family Trust, dated 1/5/07,          D.C. No. 2:10-cv-05491-JHN-
on behalf of themselves and all others           MAN
similarly situated,

              Plaintiffs - Appellants,           MEMORANDUM *

  v.

BERTHEL FISHER & COMPANY
FINANCIAL SERVICES, INC., an Iowa
corporation; et al.,

              Defendants - Appellees.



                    Appeal from the United States District Court
                       for the Central District of California
                  Jacqueline H. Nguyen, District Judge, Presiding

                        Argued and Submitted May 10, 2012
                               Pasadena, California

Before: PREGERSON, GRABER, and BERZON, Circuit Judges.

       Plaintiffs appeal from the dismissal with prejudice of their First Amended

Complaint in this securities fraud case. Reviewing de novo, WPP Luxembourg


        *
         This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Gamma Three Sarl v. Spot Runner, Inc., 655 F.3d 1039, 1047 (9th Cir. 2011),

petition for cert. filed, 80 U.S.L.W. 3531 (U.S. Feb. 27, 2012) (No. 11-1069), we

affirm.

      Claims One and Two

      Plaintiffs failed to plead misrepresentation and scienter adequately. See 15

U.S.C. § 78u-4(b)(1) (requiring particularity); Fed. R. Civ. P. 9(b) (same); WPP,

655 F.3d at 1048 (stating the elements of a claim under § 10(b) of the Securities

Exchange Act of 1934 and Securities and Exchange Commission Rule 10b-5). The

complaint fails to identify any affirmative misrepresentation. The complaint also

fails to identify any material omission, because there is no allegation that the

inclusion of further information about the cross-collateralization agreement would

have revealed any specific problems with the other properties at the time the

Private Placement Memorandum ("PPM") was issued.

      Even assuming that the complaint adequately pleads a misrepresentation or

material omission, the facts alleged, taken collectively, do not "give rise to a strong

inference of scienter." Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308,

323 (2007).

      Claims Three and Four




                                           2
      The district court dismissed Plaintiffs’ Securities Act of 1933 claims on the

ground that the PPM did not qualify as a prospectus. Plaintiffs’ opening brief does

not challenge that conclusion. Accordingly, Plaintiffs have waived any challenge

to the district court’s dismissal of their Securities Act of 1933 claims. See Arpin v.

Santa Clara Valley Transp. Agency, 261 F.3d 912, 919 (9th Cir. 2001) ("[I]ssues

which are not specifically and distinctly argued and raised in a party’s opening

brief are waived.").

      Claims Five and Six

      Plaintiffs’ opening brief fails to contest the district court’s decision not to

exercise supplemental jurisdiction over their state law claims. Accordingly,

Plaintiffs have waived their right to appeal the dismissal of their state law claims.

See Fields v. Palmdale Sch. Dist., 427 F.3d 1197, 1203 n.6 (9th Cir. 2005)

(concluding that, by failing to raise the issue in their opening brief, the plaintiffs

waived any right to appeal the district court’s decision not to exercise supplemental

jurisdiction over their remaining state law claims).

      AFFIRMED.




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