59 F.3d 176NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.
Ralph RENNA, Plaintiff-Appellant,v.ALLSTATE INSURANCE COMPANY, DOES 1-20, Defendant-Appellee.
No. 93-17301.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted June 13, 1995.Decided June 21, 1995.

Before:  SCHROEDER, BEEZER and THOMPSON, Circuit Judges.

1
MEMORANDUM*

OVERVIEW

2
Ralph Renna appeals the district court's summary judgment for Allstate Insurance Company in Renna's diversity action for breach of contract, breach of the implied covenant of good faith and fair dealing, and negligence, arising out of a dispute over coverage for costs of earthquake repairs to Renna's home.  We affirm.

FACTS

3
Renna's home, located in Saratoga, California, was damaged October 17, 1989 by an earthquake.  He submitted a claim under his homeowner's insurance policy to Allstate Insurance Company (Allstate).  Under the terms of the policy, he was entitled to the actual cash value of the loss up to the policy limit.  However, if he completed repairs of the damaged property within 180 days of Allstate's last cash value payment, he would be entitled to reimbursement of his total cost to repair the home, even if that cost exceeded the policy limit.  Allstate paid the policy limit of $959,200 in March 1991.  It is undisputed that Renna never completed the repairs within 180 days after the last cash value payment.

4
The district court granted Allstate's motion for summary judgment and later denied Renna's motion for reconsideration.  This appeal followed.

DISCUSSION
A.  Breach of Contract Claim

5
Renna contends Allstate breached his insurance contract by failing to pay him the actual replacement cost of his home.  A condition precedent to payment of the actual replacement cost, in excess of the policy limit, was that Renna had to make all repairs to his home within 180 days of Allstate's last cash value payment.  Renna contends this condition precedent was excused under the doctrine of "impossibility," because he did not have the money to make the repairs within the 180-day period.1

6
Under California law, "[t]he defense of impracticality (or impossibility) of performance is a matter of law to be decided by the trial court," and one which Renna bore the burden of proving.  Monroe v. Oakland Unified Sch. Dist., 114 Cal.  App. 3d 804, 813 (1981).

7
In support of his impossibility contention, Renna offered only his own naked assertion of penury.2  He did not present any evidence that it was impossible or impracticable to obtain construction funding from other sources.  See McCalden v. California Library Ass'n, 955 F.2d 1214, 1219 (9th Cir. 1990)  ("A party invoking the impossibility defense must show that he used reasonable efforts to surmount the obstacles which prevented performance.")  (citing Oosten v. Hay Haulers Dairy Employees & Helpers Union, 45 Cal. 2d 784, 789 (1955)), cert. denied, 504 U.S. 957 (1992).

8
Nor did he establish that his situation involved more than "[m]ere difficulty, or unusual or unexpected expense."  Glens Falls Indem. Co. v. Perscallo, 96 Cal.  App. 2d 799, 802 (1950); see also Schmeltzer v. Gregory, 266 Cal.  App. 2d 420, 424 (1968) ("It is elemental that a person may not escape a voluntary assumed contractual obligation merely because performance would be more expensive than contemplated unless it arises to the point of impossibility.").  Allstate paid Renna $959,200, which was the policy limit according to the terms of the policy as adjusted following the earthquake damage to the home.  Notwithstanding the receipt of this money, Renna only produced $87,000 worth of receipts for alleged repairs to the house.  The district court commented that this circumstance rendered Renna's financial impossibility argument "implausible."  See California Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, Inc., 818 F.2d 1466, 1468 (9th Cir. 1987) ("[I]f the factual context makes the non-moving party's claim implausible, that party must come forward with more persuasive evidence than would otherwise be necessary to show that there is a genuine issue for trial."), cert. denied, 484 U.S. 1006 (1988).

9
Moreover, in its order denying reconsideration, the district court pointed out that any dispute as to Renna's financial ability to make the repairs was irrelevant, because the policy specifically provided that if the insured (Renna) wanted to recover the full cost of repairing the home, he had to make the necessary repairs within the specified 180-day time period.  This policy provision made it reasonably foreseeable that the policy limit might not be enough to cover all costs of repair, and to the extent it did not, that any excess would be Renna's financial obligation.  Because this circumstance was reasonably foreseeable, "there can be no commercial frustration of [the] contract."  Glens Falls, 96 Cal.  App. 2d at 802.

10
Because Renna failed to present "specific facts" showing that there was a material issue to be tried on his breach of contract claim, the district court did not err in granting summary judgment on this claim in favor of Allstate.  See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986).3

B.  Negligence Claim

11
Renna contends that Allstate violated its duty of care by not advising him to obtain a higher coverage limit on his home.  The question whether a duty exists is decided by the court as a matter of law.  Ahern v. Dillenback, 1 Cal.  App. 4th 36, 42-43 (1991).

12
Under California law, insurance agents do not owe their insureds a duty to establish and maintain adequate policy limits.  See, e.g., Jones v. Grewe, 189 Cal.  App. 3d 950 (1987); Schultz Steel Co. v. Rowan-Wilson, Inc., 187 Cal.  App. 3d 513 (1986).  Notwithstanding that Renna told the agent he wanted "adequate" coverage, and the agent actually toured the property before writing the policy, Allstate did not have an independent duty to advise Renna regarding the adequacy of his policy limits.  See Jones, 189 Cal.  App. 3d at 956-57; Schultz, 187 Cal.  App. 3d at 523-25.

13
Moreover, there was no evidence that Renna made, or that Allstate responded to, any inquiries concerning the adequacy of his limits sufficient to create a special duty on Allstate's part.  Compare Free v. Republic Ins. Co., 8 Cal.  App. 4th 1726, 1729 (1992) (departing from general rule that agent owes no duty to insured regarding coverage limits, when plaintiff for ten years annually contacted his agent to determine adequacy of his coverage, and policy contained no home replacement cost guarantee).

14
Renna attempts to minimize controlling California case law by drawing a distinction between liability and homeowner's insurance.  Such a distinction has been implicitly rejected by the California courts, and we therefore reject it as well.  See Free, 8 Cal.  App. 4th at 1729.

15
Renna also argues that because Allstate "maintained complete control over policy limits," Allstate owed a special, independent duty of care to ensure that he carried adequate insurance.  We reject this argument.

16
It is undisputed that Renna told the Allstate agent it had recently cost approximately $800,000 to build his house.  This was the amount of the initial policy limit accepted by both Renna and Allstate.  The importance of this is the premium Renna was required to pay was computed with reference to the policy limit.  By accepting the $800,000 limit as 100% of replacement cost of the house, and paying a premium on that amount, Renna was entitled to recover the full cost of replacement of the house regardless of the policy limit.  All he had to do to avail himself of this privilege was pay the cost of repairs within 180 days of Allstate's last cash value payment.

17
Allstate did not maintain complete control over the policy limit.  Renna had the right under the policy "to increase the limit of liability [for dwelling protection coverage] at any time."  He never exercised this right, despite receiving annual policy declarations listing the coverage amounts.  Even when the coverage amounts were erroneously set lower, which resulted in reduced premiums, he accepted the reduced policy limit amounts and paid the reduced premiums without objection.4

18
The district court did not err in granting summary judgment in favor of Allstate.

19
AFFIRMED.

*
 This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by Ninth Circuit Rule 36-3

1
 At oral argument, Renna for the first time contended the 180-day repair clause in the Allstate policy was unconscionable and therefore should not be enforced.  Because none of the exceptions "to our general rule that an issue may not be raised for the first time on appeal" exist, we decline to consider the issue.  See United States v. Carlson, 900 F.2d 1346, 1349-50 (9th Cir. 1990)

2
 Q:  With regard to the exterior repairs, then why is it that no repairs have been done?
A:  I haven't got the money.  If they would pay all that it would take to do it, then it would have got done.

3
 Renna does not dispute that his claim for breach of the implied covenant relates to Allstate's failure to pay contract benefits.  As such, the former claim is nothing more than an "attempt to recover on the policy," Abari v. State Farm Fire & Casualty Co., 205 Cal.  App. 3d 530, 536 (1988) (emphasis in original), which cannot lie independently of the breach of contract claim.  See Prieto v. State Farm Fire & Casualty Co., 225 Cal.  App. 3d 1188, 1195-96 (1990)

4
 Renna claims he asked for, and was denied, an increase in policy coverage.  He made this request, however, after the earthquake, and did so because he wanted to obtain a retroactive increase in the policy limit.  Allstate did increase the policy limit after the earthquake, but only to the extent required to set the policy limit to the correct limit


[Cite as State v. Miley, 2013-Ohio-5673.]

                                        COURT OF APPEALS
                                     RICHLAND COUNTY, OHIO
                                    FIFTH APPELLATE DISTRICT

STATE OF OHIO                                     JUDGES:
                                                  Hon. William B. Hoffman, P.J.
        Plaintiff-Appellee                        Hon. John W. Wise, J.
                                                  Hon. Craig R. Baldwin, J.
-vs-
                                                  Case No. 13CA47
MILTON C. MILEY

        Defendant-Appellant                       OPINION

CHARACTER OF PROCEEDING:                       Appeal from the Richland County Common
                                               Pleas Court, Case No. 05-CR-85 H

JUDGMENT:                                      Affirmed

DATE OF JUDGMENT ENTRY:                         December 4, 2013

APPEARANCES:

For Plaintiff-Appellee                         For Defendant-Appellant

JAMES J. MAYER, JR.                            MILTON C. MILEY, PRO SE
Prosecuting Attorney                           Inmate Number 484-425
Richland County, Ohio                          c/o Allen Correctional Institution
                                               P.O. Box 4501
By: JILL M. COCHRAN                            Lima, Ohio 45802
Assistant Richland County Prosecutor
38 South Park Street
Mansfield, Ohio 44902
Richland County, Case No. 13CA47                                                             2

Hoffman, P.J.

         {¶1}   Defendant-appellant Milton C. Miley appeals the judgment entered by the

Richland County Court of Common Pleas denying his motion to vacate sentence.

Plaintiff-appellee is the state of Ohio.

                            STATEMENT OF PROCEDURAL HISTORY1

         {¶2}   In 2004, Appellant was indicted by the Richland County Grand Jury on 55

counts in Case No. 2005 CR 0085, including rape, unlawful sexual conduct with a

minor, corrupting another with drugs and disseminating matter harmful to juveniles.

         {¶3}   On May 20, 2005, a jury returned a verdict of guilty as to all counts of the

indictment. On May 31, 2005, the trial court sentenced Appellant to a total prison term of

thirty-five years. The trial court further classified Appellant a sexual predator under R.C.

Chapter 2950. An appeal ensued.

         {¶4}   On September 8, 2006, this Court reversed Appellant's convictions and

remanded the matter for a new trial finding the trial court erred in admitting evidence of

Appellant's prior acts. State v. Miley, 5th Dist. Nos.2005–CA–67 and 2006–CA–14,

2006–Ohio–4670.

         {¶5}   On February 8, 2007, the Richland County Grand Jury indicted Appellant

on four additional charges alleging recently discovered evidence in Case No. 2007 CR

0163. On July 30, 2007, Appellant filed a motion to dismiss the 2007 indictment on

speedy trial grounds. The trial court overruled the motion, via Judgment Entry of

September 21, 2007. The trial court then consolidated the cases and scheduled a trial

date for October 8, 2007.

1
    A rendition of the underlying facts is unnecessary for our disposition of this appeal.
Richland County, Case No. 13CA47                                                         3

      {¶6}   On October 9, 2007, Appellant entered a plea of no contest to two of the

additional charges, counts 58 and 59, of having weapons under disability. Following a

trial by jury, Appellant was convicted on a total 57 counts, and sentenced to thirty-eight

years in prison, via two separate entries in Case Nos. 2005 CR 0085 and 2007 CR

0163. Appellant again appealed.

      {¶7}   In State v. Miley, 5th Dist. Nos. 07–CA–113 and 07–CA–114, 2009–Ohio–

570, this Court dismissed Appellant's appeal for lack of a final, appealable order

pursuant to the Ohio Supreme Court's decision in State v. Baker, 119 Ohio St.3d 197,

2008–Ohio–3330, 893 N.E.2d 163. The entries at issue in the consolidated appeal did

not contain the manner of conviction; therefore, the entries were not final, appealable

orders pursuant to Baker.

      {¶8}   On February 13, 2009, the trial court issued amended sentencing entries.

Appellant filed an appeal of the February 13, 2009 amended sentencing entries. In

State v. Miley, 5th Dist. Nos. 09CA39 and 09CA40, 2009–Ohio–4011, this Court first

found the trial court erred in not dismissing counts 58 and 59 charging having weapons

under disability because Appellant's speedy trial rights were violated. We affirmed the

remainder of the trial court's decision in relation to Appellant's conviction and sentence.

On December 2, 2009, the Ohio Supreme declined to accept the case on further

appeal.

      {¶9}   On March 17, 2010, Appellant filed a complaint requesting the issuance of

a writ of mandamus and/or procendendo compelling the trial court to issue a final,

appealable order, which complied with State v. Baker, supra. State ex rel. Miley v.

Henson, Richland App. No.2010–CA–0032, 2010–Ohio–4093. In that case, this Court
Richland County, Case No. 13CA47                                                            4

reviewed the entries issued by the trial court on February 13, 2009, finding although this

Court allowed an appeal based upon the entries to proceed to a conclusion in State v.

Miley, 5th Dist. Nos. 09CA39 and 09CA40, 2009–Ohio–4011, the opinion on the merits

was improvidently issued because the order was not a final, appealable order because

the order did not contain a finding of guilt. This Court then ordered the trial court to issue

an entry which complied with the dictates of Baker.2

       {¶10} On December 28, 2010, the trial court filed a Nunc Pro Tunc sentencing

entry in Case No.2005 CR 85H. The Court included amended language “the defendant

had been found guilty” by a jury, and also clarified the terms of postrelease control.

       {¶11} Appellant again filed an appeal to this Court in State v. Miley 5th Dist. No.

2011CA0005, 2011-Ohio-5647. This Court held,

       {¶12} "Applying Lester, we find appellant's convictions were upheld on direct

appeal by this Court in State v. Miley, 5th Dist. Nos. 09CA39 and 09CA40, 2009–Ohio–

4011 and the Ohio Supreme Court declined jurisdiction. The convictions were based

upon the entries issued by the trial court on February 13, 2009. Upon review, we find

the entry in the underlying case fully complied with the requirements of Crim.R. 32(C),

and as set forth in the Lester syllabus. Appellant's 2009 judgment of conviction was

final, and any new challenges to it are barred by the doctrine of res judicata. The nunc

pro tunc entry by its very nature applies retrospectively to the judgment it corrects and is

not a new final order from which a new appeal may be taken to again challenge the

underlying conviction.

2
  The State suggests this order was limited to the sentencing entry reflecting appellant's
plea of no contest to the weapons charges in Case No. 2007 CR 163, nevertheless this
Court issued the writ in regards to Case No. 2005 CR 85.
Richland County, Case No. 13CA47                                                          5

       {¶13} "Although Appellant does not challenge on appeal the modified terms of

postrelease control, we note that the doctrine of res judicata still applies to all other

aspects of the conviction, including the determination of guilt. State v. Fischer, 128 Ohio

St.3d 92, 2010–Ohio–6238."

       {¶14} On April 1, 2013, Appellant filed a motion to vacate sentence and to

resentence. Via Judgment Entry of May 2, 2013, the trial court overruled the motion to

vacate and resentence. Appellant now appeals, assigning as error:

       {¶15} “I. THE TRIAL COURT ERRED IN DENYING THE DEFENDANT

APPELLANT’S       MOTION      TO    VACATE      SENTENCE       AND     RESENTENCE        IN

ACCORDANCE WITH CRIMINAL RULE 32 (B) VIOLATING HIS RIGHTS TO EQUAL

PROTECTION UNDER THE LAW AND RIGHT TO DUE PROCESS AS GUARANTEED

BY BOTH THE UNITED STATES AND THE OHIO CONSTITUTIONS.”

       {¶16} In the sole assignment of error Appellant maintains the trial court erred in

denying his motion to vacate and resentence in accordance with Criminal Rule 32(B).

Appellant alleges he was never properly advised of his rights pursuant to Criminal Rule

32(B); therefore, he must be resentenced accordingly.

       {¶17} As set froth in the Statement of Procedural History above, Appellant was

sentenced on December 22, 2007. On two occasions this Court found the sentencing

entries relative to Appellant's sentence did not constitute final appealable orders. On

December 28, 2010, the trial court issued an amended entry clarifying the terms of

postrelease control and indicating Appellant had been found guilty of the charges and

the manner of conviction. This Court found further arguments barred by the doctrine of

res judicata. Appellant filed an appeal to this Court. As set forth above, this Court held,
Richland County, Case No. 13CA47                                                          6

       {¶18} "Applying Lester, we find appellant's convictions were upheld on direct

appeal by this Court in State v. Miley, 5th Dist. Nos. 09CA39 and 09CA40, 2009–Ohio–

4011 and the Ohio Supreme Court declined jurisdiction. The convictions were based

upon the entries issued by the trial court on February 13, 2009. Upon review, we find

the entry in the underlying case fully complied with the requirements of Crim.R. 32(C),

and as set forth in the Lester syllabus. Appellant's 2009 judgment of conviction was

final, and any new challenges to it are barred by the doctrine of res judicata. The nunc

pro tunc entry by its very nature applies retrospectively to the judgment it corrects and is

not a new final order from which a new appeal may be taken to again challenge the

underlying conviction.

       {¶19} "Although Appellant does not challenge on appeal the modified terms of

postrelease control, we note that the doctrine of res judicata still applies to all other

aspects of the conviction, including the determination of guilt. State v. Fischer, 128 Ohio

St.3d 92, 2010–Ohio–6238."

       {¶20} As such, we find Appellant's arguments raised in the motion to vacate and

resentence an attempt to circumvent his prior invocation of the appellate process. We

again find his present arguments barred by the doctrine of res judicata.

       {¶21} This case is factually distinguishable from State v. Hunter, 2010-Ohio-657,

cited by Appellant, as Appellant was represented by counsel at the time of sentencing

herein, has failed to fully demonstrate the trial court did not comply with Criminal Rule

32 at the time he was sentenced, and Appellant has previously directly appealed his

sentence to this Court.
Richland County, Case No. 13CA47                                                7

      {¶22} Accordingly, the May 2, 2013 Judgment Entry denying Appellant's motion

to vacate and resentence is affirmed.

By: Hoffman, P.J.

Wise, J. and

Baldwin, J. concur

                                        ___________________________________
                                        HON. WILLIAM B. HOFFMAN

                                        ___________________________________
                                        HON. JOHN W. WISE

                                        ___________________________________
                                        HON. CRAIG R. BALDWIN
Richland County, Case No. 13CA47                                                      8

           IN THE COURT OF APPEALS FOR RICHLAND COUNTY, OHIO
                        FIFTH APPELLATE DISTRICT

STATE OF OHIO                             :
                                          :
       Plaintiff-Appellee                 :
                                          :
-vs-                                      :         JUDGMENT ENTRY
                                          :
MILTON C. MILEY                           :
                                          :
       Defendant-Appellant                :         Case No. 13CA47

       For the reasons stated in our accompanying Opinion, the May 2, 2013 Judgment

Entry of the Richland County Court of Common Pleas is affirmed. Costs to Appellant.

                                          ___________________________________
                                          HON. WILLIAM B. HOFFMAN

                                          ___________________________________
                                          HON. JOHN W. WISE

                                          ___________________________________
                                          HON. CRAIG R. BALDWIN


26 Ariz. App. 137 (1976)
546 P.2d 1146
Marvin JAMES and Barbara H. James, individually and as husband and wife and as surviving parents of John Marvin James, Deceased minor, Appellants,
v.
AETNA LIFE & CASUALTY, Appellee.
No. 2 CA-CIV 2016.
Court of Appeals of Arizona, Division 2.
March 17, 1976.
Rehearing Denied April 14, 1976.
*138 Law offices of Richard D. Grand by James G. Heckbert, Tucson, for appellants.
Chandler, Tullar, Udall & Richmond by D.B. Udall, Tucson, for appellee.
OPINION
HOWARD, Chief Judge.
When will deviation from permissive use preclude coverage under the omnibus clause? That is the issue to be determined in this appeal from the judgment entered after a bench trial.
Appellants are the parents of a sixteen-year old boy who was killed when a vehicle driven by Leonard Robles collided with the rear-end of a vehicle the boy was attempting to rig for tow, crushing him between the disabled and towing vehicles. The truck operated by Robles was owned by Adams Tree Service, Inc., his employer. Appellants brought a wrongful death action against Robles and Adams. Appellee brought an independent action seeking a declaratory judgment to the effect that its policy issued in the name of Adams did not cover Robles on this occasion for the reason that Robles, at the time of the accident, was not using the vehicle with Adams' permission. Appellee prevailed in the declaratory judgment action, the court ruling that appellee's policy did not provide coverage for the accident.
Appellants contend the court's decision was based upon an erroneous interpretation of the law concerning permissive use within the meaning of the omnibus provision in the policy which states:
"II. PERSONS INSURED
Each of the following is an insured under this insurance to the extent set forth below:
* * * * * *
(c) any other person while using an owned automobile with the permission of the named insured provided his actual operation ... thereof is within the scope of such permission, ...
* * * * * *"
On the day of the accident, Robles left the Adams lot at approximately 4:45 p.m. He then drove a fellow employee home and returned to the Adams lot. After again leaving the lot, Robles drove to his brother-in-law's house located on South 8th Avenue. At 11:30 p.m. he went to a bar on 36th Street. At approximately 12:30 a.m. he returned to the house on South 8th Avenue. He then used the company truck to drive his brother-in-law to a service station near 22nd Street and Interstate 10 where they had a tire from the brother-in-law's truck repaired. Robles then drove his brother-in-law home and proceeded to drive toward his own house. The collision occurred at 1:48 a.m. on December 1, 1973, on West Ajo Way, a place where Robles might have been had he driven straight home from work.
Courts are not in agreement as to what legal theory to apply in determining when a deviation from the purpose and use for which permission is granted will preclude coverage under the omnibus clause of an automobile liability insurance policy. Three rules have been adopted: (1) the strict, *139 conversion or specific purpose rule, (2) the "hell or high water rule" and (3) the minor deviation rule. See Annot. 5 A.L.R.2d 600 (1949).
Under the strict, conversion, or specific purpose rule the time when the bailment was to expire must not have passed; the place where the vehicle is used must be one either specified or contemplated by the parties; and the use made of the automobile at the time of the accident must be one either contemplated or specified. All these elements must be present in order for permission to exist. See, 12 Couch on Insurance 2d Sec. 45:464 p. 452 (1964).
The "hell or high water" rule which extends coverage if there was initial permission to use the car, no matter how gross the deviation may be, was specifically rejected by our Supreme Court in Universal Underwriters Ins. Co. v. State Auto & Cas. Underwriters, 108 Ariz. 113, 493 P.2d 495 (1972).
The intermediate position is the "minor deviation rule", i.e. if the bailee's use is not a gross, substantial, or major violation, even though it may have amounted to a deviation, protection is still afforded to the bailee under the omnibus clause. Thus, under this rule the deviation is "material" or "major" when the deviation from the purpose for which the permission was originally granted was substantial in terms of duration, distance, time, or purpose. Speidel v. Kellum, 340 S.W.2d 200 (Mo. App. 1960); Farmers Mut. Auto. Ins. Co. v. Noel, 211 F. Supp. 216 (W.D.Mo. 1962); 12 Couch on Insurance 2d Secs. 45:474 and 45:475; Annot. 5 A.L.R.2d 600, 636.
Considering the purpose of the financial responsibility laws as expressed in Jenkins v. Mayflower Insurance Exchange, 93 Ariz. 287, 380 P.2d 145 (1963), we believe the "minor deviation" rule best advances the public policy of the state.
Robles was given the use of the truck for transportation to and from work. He had no authority to drive it for his own personal use. While it is true that his employer did not specify a time frame for traveling to and from work, a reasonable time to accomplish the trip must be implied. Robles left work at 4:30 p.m. and the accident occurred at 1:48 a.m. the next day. During this time he had been to his brother-in-law's home, a bar, a gas station for a purpose unconnected with his employment, and back to his brother-in-law's house.
The lower court, as the trier of fact, found that Robles was not within the scope of the permissive use "because of the time element of when the accident occurred in relationship to when he left his place of employment." Whether or not Robles' operation of the vehicle at the time of the accident was within the "minor deviation" rule was a question for the trier of fact. The lapse of nine hours from the time Robles left his place of employment until the accident occurred justified the trier of fact in concluding that, in view of the purpose of the permissive use, i.e. transportation to and from work, the deviation was not minor. We therefore, cannot agree with appellants' contention that the trial court erred in concluding that Robles was not a permissive user within the ambit of the omnibus clause. Cases cited by appellants involving an employee's return, after a deviation, to the scope of his employment are not apposite here.
Affirmed.
KRUCKER, J., concurs.
HATHAWAY, Judge (specially concurring).
The trial court and the majority conclude that Robles was not within the scope of the permissive use because of the time of the use. This court-imposed time restriction is at odds with the uncontroverted evidence, namely the testimony of Anthony Adams, vice president of Adams Tree Service, who authorized the use and answered affirmatively that no time limit was placed "... on when he was to be home, nor did the rules say anything about *140 the time limits in which he was to go to and from his home ..." The uncontroverted evidence is that the vehicle was in a normal home-bound route at the time of the accident and Robles' statement confirms that he was in route home.
I reach the same result as the trial court and the majority on the portion of his statement that he had "... about 4 or 5 beers between 5:30 and 12:30 p.m. [sic]" Company Rule 5 provides:
"No one may drive a company vehicle after consuming alcoholic beverages for at least two hours after consumption."
Robles was in violation of this rule and was, therefore, not a permissive user at the time of the accident. For that reason I would affirm.


                              No.       94-493
           IN THE SUPREME COURT OF THE STATE OF MONTANA
                                    1996

IN RE THE MARRIAGE OF
MONICA ELAINE SMITH,
           Petitioner and Respondent,
     and
VAN EARL SMITH,
           Respondent and Appellant

APPEAL FROM:      District Court of the Eighth Judicial District,
                  In and for the County of Cascade,
                  The Honorable Thomas M. McKittrick, Judge presiding.

COUNSEL OF RECORD:
           For Appellant:
                  Michael S. Smartt; Big Sky Law Center,
                  Great Falls, Montana
           For Respondent:
                  Joan E. Cook; Miller and Cook,
                  Great Falls, Montana

                                    Submitted on Briefs:    March 7, 1996
                                                 Decided:   May 6, 1996
Filed:

                                    /
                                    Clerk
Justice Karla M. Gray delivered the Opinion of the Court.

     Pursuant to Section I, Paragraph 3(c), Montana Supreme Court
1995 Internal Operating Rules, the following decision shall not be
cited as precedent and shall be published by its filing as a public
document with the Clerk of the Supreme Court and by a report of its
result to State Reporter Publishing Company and West Publishing
Company.
     Van Earl Smith (Van) appeals from the June 10, 1994, judgment
of the Eighth Judicial District Court, Cascade County, granting
Monica Elaine Smith (Monica) primary physical custody of the
couple's children and awarding child support in the amount of $310
per month.   We affirm.
     We address the following issues on appeal:
     1.  Did the District Court abuse its discretion in awarding
primary physical custody of the children to Monica?
     2. Did the District Court err in its application of the child
support guidelines?
     Monica and Van married on May 31, 1985.   They had two children
during their marriage.    The District Court entered a Final Decree
of Dissolution on November 14, 1990, adopting and incorporating the
parties' settlement agreement provisions regarding custody.   Under
the agreement, the parties would alternate actual physical custody
of the children every six months until the oldest child started
kindergarten,   at which time actual physical     custody would be
redetermined.   In incorporating the agreement's custody provisions
into the decree,   the District Court added that the standard for
redetermining custody would be the best interests of the children.
Neither party appealed.

                                  2
        The oldest child started kindergarten in 1992.            In January of
1993,    upon motions by both parties,        the District Court entered a
temporary     custody   order in which Monica was awarded physical
custody of the children for the rest of the school year and one-
half of the summer.         Van was granted physical custody for the
remainder of the summer and the beginning of the 1993-94 school
year.     The District Court stated that it would be necessary to
review the children's custody at a later date.
        In December of 1993, Monica petitioned the court to review the
children's    custody    arrangement.       On June 13, 1994, the District
Court entered its Findings of Fact, Conclusions of Law and Order
awarding Monica primary physical custody of the children; the court
gave Van secondary physical custody from one week after school
terminates in the summer until two weeks before school begins in
the fall. Van was required to provide child support in the amount
of $155 per month per child, for a total of $310 per month, for the
months Monica has physical custody of the children. Van appeals.
      1. Did the District Court abuse its discretion in awarding
primary physical custody of the children to Monica?
        The District Court made extensive findings of fact relating to
custody of the children,         concluded that the           "best interests"
standard contained in § 40-4-212(l),               MCA, applied and determined
that it was in the children's best interests to be placed in
Monica's primary physical custody.             We will overturn a district
court's      custody    determination       only     when   its   findings   and
conclusions clearly demonstrate an abuse of discretion.               & In re
Marriage of Hunt (19941, 264 Mont. 159, 164, 870 P.2d 720, 723

                                        3
(citation omitted); In re Marriage of Strizic (19941,               263 Mont.
193,   195, 867 P.2d 386, 387 (citation omitted).
     a.   Did the District Court err in applying § 40-4-212, MCA,
instead of § 40-4-219, MCA?
       Van argues that the District Court improperly relied on the
best interests standard contained in § 40-4-212, MCA, in deter-
mining    the    children's    physical    custody.      He contends that the
court's action was a modification of custody subject to the more
stringent requirements of § 40-4-219, MCA.                We review a district
court's     conclusions       of   law to determine whether the court's
interpretation of the law is correct.                 In re Marriage of Kovash
(1995) I 270 Mont. 517, 521, 893 P.2d 860, 863 (citation omitted).
       A district court making an original determination of child
custody applies the best interest of the child standard contained
in § 40-4-212, MCA. A modification of custody, on the other hand,
can be accomplished only under § 40-4-219, MCA.                The § 40-4-219,
MCA,   "change of circumstance" requirement and the requirement that
the court find that one of the subsection (a) through (f) factors
exists are jurisdictional prerequisites to modification of custody;
unless    the    prerequisites     are   satisfied,    a court may not modify
custody even if it finds that modification is in the child's best
interest.       Section 40-4-219, MCA; In re Marriage of Johnson (1994),
266 Mont. 158, 162-66, 879 P.2d 689, 692-94.                The more stringent
requirements of !$ 40-4-219, MCA, reflect the Legislature's recog-
nition of the importance of continuity and stability in children's
living    arrangements.       Marriase of Johnson, 879 P.2d at 694.
       We have held that a petition to modify child custody which has
the effect of         substantially changing the residential            living

                                           4
arrangements      of   a     child    must      satisfy      the      jurisdictional
requirements set forth in § 40-4-219,                 MCA.   Marriase of Johnson,
a79 P.2d at 694.       Monica and Van's motions in this case sought to
substantially    change     the    children's        residential    arrangements   by
terminating the alternating six-month custody schedule and having
themselves designated the children's primary physical custodian for
the entirety of the school year.               Thus,     pursuant to Marriaqe      of
Johnson, § 40-4-219, MCA, ordinarily would apply.
     The District Court, however, applied the terms of its original
decree under which custody was to be "redetermined in accordance
with the best interests of the children" when the oldest child
started    kindergarten.          The redetermination provision had been
agreed upon in Monica and Van's settlement agreement and incor-
porated into the original decree with the addition of the best
interest standard.         Neither party appealed the 1990 decree, which
predated   Marriase    of    Johnson.        Thus,     the decree reflected the
parties' voluntary      intentions      and    expectations        regarding   custody
redetermination and the standard under which redetermination would
be made.        Under these unique facts, it would be altogether
inequitable to permit Van to now reject his earlier agreement and
invoke § 40-4-219, MCA, in order to vary the express terms of the
1990 decree.     We conclude, therefore, that the District Court did
not err in determining the children's                    custody under the best
interest standard contained in § 40-4-212, MCA.
     b. Did the District Court abuse its discretion in determining
that it was in the children's best interests to award primary
physical custody to Monica?
     Van argues that the evidence supports his contention that it
is in the children's best interests that he be designated their
                                         5
primary residential custodian and challenges several of the court's
findings.       However, our standard in reviewing a district court's
underlying findings of fact in a child custody case is whether
those    findings    are clearly erroneous; we             review the ultimate
custody determination under a clear abuse of discretion standard.
In re Marriage of Dreesbach (1994), 265 Mont. 216, 220-21, 875 P.2d
1018,    1021   (citations    omitted).        Moreover,    it is particularly
important in custody modification cases that this Court defer to
the district court which personally evaluated the testimony and was
in the best position to determine the credibility and character of
the witnesses.       In re Marriage of Starks (1993), 259 Mont. 138,
143,    855 P.2d 527,        530   (citation    omitted).      In the face of
conflicting evidence, it is the trier of fact's function to resolve
the conflicts and we will not substitute our judgment for that of
the district court.      Marriase of Starks, 855 P.2d at 530.
        The evidence of record in this case regarding the parties' and
children's circumstances is substantial and often contradictory.
The District Court entered extensive findings relating to the
factors to be considered under § 40-4-212, MCA, in determining a
child's best interest.
        With regard to Monica, the court found that Monica appears to
have a strong marital relationship with her new husband, they have
attended parenting classes and the children enjoy normal play and
educational activities at her house; during the post-July 1993
period when Van had custody of the children, Monica maintained
regular telephone contact with them and traveled from North Dakota
to Great Falls to see them a number of times.                 The court further
found that Monica and her husband have a large house, Monica is
                                          6
currently a      housewife        and    one   child's   deficient     academic
performance    resulted    from    unsatisfactory    maturity    skills    rather
than poor schools near Monica's residence.
     Van asserts that certain of the District Court's findings
relating to Monica are not supported by the evidence.              He contends,
for example, that no evidence supports the findings that Monica's
psychological counseling was terminated at the suggestion of her
counselor and that Monica and her husband,               Joel,   have a strong
marital    relationship.       The record, however,       reflects   otherwise.
Monica testified that her counselor terminated her counseling
sessions and both Monica and Joel testified to the strength of
their marriage.
     Van also asserts that no evidence supports the District
Court's    finding that the         children     experienced     "educationally
related endeavors" while in Monica's custody.               Monica   testified,
however,    that she engages with the children in coloring, Sunday
school     and playing cars.            Given the   children's     ages,    these
activities fairly can be said to constitute educationally-related
endeavors.
     In addition, Van apparently contends that the District Court's
finding that Monica and Joel attend church, "although not every
Sunday,"     is exaggerated.       The finding is supported by Monica's
testimony that she and Joel attend church as often as they can and
that work obligations prevent them from attending church every
Sunday.
     Van's final argument regarding lack of evidence to support the
court's finding relates to one child's alleged breathing problem.
According to the District Court, Monica "testified that . there
                                          7
was no interruption in Jordan's breathing."          Van is correct that
the record does not contain testimony by Monica that the child's
breathing was not interrupted; her actual testimony was that she
was not sure that the child had stopped breathing.              Such a minor
variance from the record with regard to one portion of one sentence
in     a four-sentence finding relating to the child's breathing
problem does not, however, constitute a lack of evidence to support
the remainder of the finding.       The variance is, at best, harmless
error in the context of the extensive findings of fact relating to
the children's custody.
        Van's remaining challenges to the court's findings essentially
suggest that the District Court was required to make additional
findings.      We disagree.   The    court's   findings   are   sufficiently
comprehensive in light of the factors enumerated in § 40-4-212,
MCA.
        The District Court weighed the evidence before it and entered
extensive findings pursuant to § 40-4-212, MCA.           We conclude that
the findings are supported by substantial evidence and are not
otherwise clearly erroneous.        We hold that the District Court did
not abuse its discretion in awarding primary physical custody of
the children to Monica.
     2 . Did the District Court abuse its discretion in applying
the child support guidelines?
        The District Court awarded Monica a total of $310 per month
child support for the months that Monica has physical custody of
the children.     Our standard in reviewing a district court's child
support award is whether the court abused its discretion.              In re
Marriage of Noel (1994), 265 Mont. 249, 252, 875 P.2d 358, 359

                                      8
(citation omitted).       The district court must take into account the
parties' actual situation and apply its discretion in a realistic
manner.     Marriage of Noel, 875 P.2d at 359 (citation omitted).
     Under    Montana's    child   support    guidelines,   each parent is
required to contribute child support in an amount proportionate to
his or her share of the parents' combined resources after specific
allowable deductions are made from each parent's gross income.
Marriage of Noel, 875 P.2d at 359.           Van argues that the District
Court erred by including depreciation relating to his employment-
related equipment in his income and that, had the court properly
deducted the depreciation from his gross income, his total child
support obligation would have been only $133 per month.          According
to Van, the District Court thereby abused its discretion.
     Section 46.30.1508(l) (c), ARM, provides that depreciation for
vehicles, machinery and tangible assets may be deducted from the
gross income of a person who is self-employed upon a showing of
economic    necessity.     The   "may be"    in the guideline language is
discretionary on its face.         Indeed,   we previously have held that
although a district court may allow depreciation on a showing of
economic necessity under the guideline, the court is not required
to do so.     Pederson v. Nordahl (1993), 261 Mont. 284, 287-88, 862
P.2d 411, 413.
     Van contends that his testimony regarding the propriety of
deducting depreciation establishes "economic necessity" under
§ 46.30.1508(l) (c), ARM.          His argument ignores the discretion
vested in the District Court by the guideline itself and by
Pederson.    We conclude that Van has failed to establish an abuse of
discretion by the court with regard to its treatment of the
                                       9
depreciation and, on that basis, we hold that the District Court
did not abuse its discretion in applying the child support
guidelines.

                               LO


547 F.3d 564 (2008)
Howard FRANK, Individually and On Behalf of All Others Similarly Situated, Plaintiff,
Plumbers & Pipefitters National Pension Fund; Seiu Pension Plans Master Trust, and West Virginia Laborers Pension Trust Fund, On Behalf of Themselves and All Others Similarly Situated, Plaintiffs-Appellants,
v.
DANA CORPORATION, Defendant, *565
Michael J. Burns and Robert C. Richter, Defendants-Appellees.
No. 07-4235.
United States Court of Appeals, Sixth Circuit.
Argued: October 30, 2008.
Decided and Filed: November 19, 2008.
*567 ARGUED: Joseph D. Daley, Coughlin, Stoia, Geller, Rudman & Robbins, San Diego, California, for Appellants. Joel W. Sternman, Katten Muchin Rosenman, New York, New York, for Appellees. ON BRIEF: Joseph D. Daley, Coughlin, Stoia, Geller, Rudman & Robbins, San Diego, California, for Appellants. Joel W. Sternman, Anthony L. Paccione, Katten Muchin Rosenman, New York, New York, for Appellees.
Before: CLAY, GILMAN, and ROGERS, Circuit Judges.

OPINION
CLAY, Circuit Judge.
Plaintiffs-appellants represent a class of investors who purchased securities of Dana Corporation ("Dana") between April 21, 2004 and October 7, 2005 (the "Class Period"). Plaintiffs' class-action complaint alleges violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, 15 U.S.C. §§ 78j(b) and 78t(a), and Rule 10b-5 promulgated thereunder by the Securities and Exchange Commission, 17 C.F.R. § 240.10b-5. In particular, Plaintiffs allege that the Defendants, two of Dana's chief corporate officers during the Class Period, are responsible for a number of intentional or reckless misstatements and material omissions which Plaintiffs allege were calculated to artificially boost Dana's stock price.
Pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, the district court dismissed the complaint for failure to satisfy the heightened pleading requirements of the Private Securities Litigation Reform Act of 1995 ("PSLRA"), finding that the complaint failed to assert allegations that could support a "strong inference" that Defendants acted with the requisite scienter. Frank v. Dana Corp., 525 F.Supp.2d 922, 932 (N.D.Ohio 2007). In articulating the controlling pleading standard, the district court stated that it was "required to accept plaintiff's inferences of scienter only if those inferences are the most plausible of competing inferences." Id. at 930 (emphasis added). Because this formulation of the applicable pleading standard is contrary to the Supreme Court's decision in Tellabs, Inc. v. Makor Issues & Rights, Ltd., ___ U.S. ___, 127 S.Ct. 2499, 168 L.Ed.2d 179 (2007), which held that a complaint will survive a motion to dismiss so long as "a reasonable person would deem the inference of scienter cogent and at least as compelling as any opposing inference one could draw from the facts alleged," id. at 2510 (emphasis added), we vacate the judgment of the district court.

I.
Dana is a supplier of automotive parts and drive-train systems for light, commercial, and off-highway vehicle manufacturers. Sales to three customersGeneral Motors, Ford, and DaimlerChrysleraccounted for nearly half of Dana's sales during the Class Period. The Defendants are Michael J. Burns and Robert C. Richter, Dana's Chief Executive Officer and Chief Financial Officer, respectively, during the Class Period. Dana is no longer a party to this action, having filed for bankruptcy protection.
Based on a series of positive financial statements, the value of Dana's stock steadily increased over the Class Period, until Dana quickly fell into financial ruin in October of 2005. Following Dana's collapse, *568 Plaintiffs filed this action, alleging that Burns and Richter misled and deceived investors by reporting strong earnings, declaring positive financial outlooks, and touting sound internal accounting procedures when in fact none of these were true. For each of the financial quarters during the Class Period, Defendants signed Dana's SEC filings, issued press releases and participated in conference calls announcing the company's quarterly earnings, and signed the company's Sarbanes-Oxley § 302 certificates.[1] Plaintiffs also allege that the Defendants misled investors by repeatedly assuring the public that Dana had instituted improved accounting controls, when in fact Dana's accounting systems and procedures were plagued with material weaknesses.
On July 21, 2004, Dana reported $0.72 second quarter earnings per share ("EPS"), more than double Dana's EPS over the same period in 2003. In announcing these earnings, Dana projected EPS of $1.90 per share for fiscal year 2004. Despite the notable rise in the price of steel and other raw materials, Defendants stated that Dana expected continued growth, assuring investors that the company's cost reduction initiatives would offset rising production costs.
On October 12, 2004, however, Dana was forced to lower its projected 2004 EPS to $1.60 to $1.65 per share, noting rising raw material costs as a key factor. Despite these pressures, Defendants continued to project positive growth for 2005. Shortly thereafter, on October 20, 2004, Dana reported solid third quarter figures, including a near 40% jump in net profits over the same period in 2003. In announcing the third quarter figures, Defendants again assured investors that Dana could offset rising costs by, among other things, "accelerat[ing] deployment of lean manufacturing techniques" and "standardiz[ing] ... administrative processes throughout the company."
On February 23, 2005, Dana again announced positive quarterly results, reporting increased fourth quarter sales and earnings over 2003. Dana also reported net income of approximately $262 million for fiscal year 2004, up from $183 million for 2003. In announcing these figures, Defendants reiterated Dana's positive financial outlook, projecting earnings of $0.17 to $0.23 per share for the first quarter of 2005 and $1.40 to $1.62 per share for 2005.
In March of 2005, Dana again was forced to temper its earnings projections, reducing its EPS forecast for both the first quarter of 2005 and fiscal year 2005. In April of 2005, Dana reported earnings below even its reduced estimate. In announcing these figures, Defendants again attempted to reassure investors that the dip in earnings was the result of temporary production issues that had been resolved. Despite rising costs and slowing production, Dana reiterated its March 2005 earnings estimate of $1.30 to $1.45 per share for 2005.
On July 20, 2005, Dana issued its earnings figures for the second quarter of 2005, reporting a staggering 275% increase over the preceding quarter. In announcing the results, Defendants claimed that the company made "substantial profit improvement" by focusing on "lean manufacturing and value engineering programs" that yielded "tangible results." Despite the increased earnings, Dana maintained its *569 tempered $1.30 to $1.45 earnings projections for 2005.
On September 15, 2005, Defendants announced that Dana was reducing its prior EPS projections by half based on rising steel prices and Dana's inability to offset the increase in production costs. Defendants also announced that Dana would likely restate its financial results for the second quarter of 2005, and that the company may have to write down its deferred tax assets. As a result of this news, Dana's shares fell 20% in a single day, with Dana's stock continuing to fall over the following days as the market absorbed the news.
Just over three weeks later, on October 10, 2005, Dana announced that its financial statements for all of 2004 and the first half of 2005 "should no longer be relied upon," and that Dana intended to restate its financial positions for those periods. Despite prior assurances regarding its internal accounting policies and controls, Dana also reported that it had uncovered "material weaknesses in its internal control over financial reporting." The market reaction was swift and unkind, as Dana's stock price dropped nearly 35% in a single day on record trading volume.
On December 30, 2005, Dana issued its restated earnings for the first two quarters of 2005, reducing its stated net income by $44 million. On January 17, 2006, Dana announced a loss of $1.27 billion for the third quarter of 2005. At the same time, Dana announced that it intended to write off nearly $1 billion of the company's assets, taking a "valuation allowance" that reduced its tax deferred assets by $918 million.
In February of 2006, the SEC announced a formal investigation into Dana's accounting practices. That same month, Dana defaulted on $21 million of interest payments on its outstanding debt. Ultimately, Dana filed for bankruptcy on March 3, 2006. Three days after the bankruptcy filing, Defendant Richter announced his retirement from the company. Defendant Burns remains at Dana.

II.
Purchasers of Dana securities initially filed suit on October 12, 2005. After the district court appointed certain plaintiffs to serve as statutory lead plaintiffs and approved their choice of counsel, the lead plaintiffs filed a consolidated class-action complaint in this action. Defendants moved to dismiss the complaint pursuant to Rules 8, 9(b), and 12(b)(6) of the Federal Rules of Civil Procedure, as well as under the pleading requirements set forth in the Private Securities Litigation Reform Act of 1995 ("PSLRA"). After briefing and oral argument, the district court granted Defendants' motion and dismissed the complaint. Frank, 525 F.Supp.2d at 933. Judgment was entered on August 21, 2007.

III.
Section 10(b) of the Exchange Act and Rule 10b-5 promulgated thereunder prohibit "fraudulent, material misstatements or omissions in connection with the sale or purchase of a security." Morse v. McWhorter, 290 F.3d 795, 798 (6th Cir. 2002). To state a securities fraud claim under Section 10(b), a plaintiff "must allege, in connection with the purchase or sale of securities, the misstatement or omission of a material fact, made with scienter, upon which the plaintiff justifiably relied and which proximately caused the plaintiff's injury." In re Comshare Inc. Sec. Litig., 183 F.3d 542, 548 (6th Cir.1999).
Securities fraud claims arising under Section 10(b), as with any fraud *570 claim, must satisfy the particularity pleading requirements of Rule 9(b). PR Diamonds, Inc. v. Chandler, 364 F.3d 671, 681 (6th Cir.2004). Accordingly, Plaintiffs' complaint must "(1) specify the statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4) explain why the statements were fraudulent." Gupta v. Terra Nitrogen Corp., 10 F.Supp.2d 879, 883 (N.D.Ohio 1998). At a minimum, Plaintiffs must allege the time, place and contents of the misrepresentations upon which they relied. Bender v. Southland Corp., 749 F.2d 1205, 1216 (6th Cir.1984).
In addition, the PSLRA imposes additional and more "[e]xacting pleading requirements" for pleading scienter in a securities fraud case. Tellabs, 127 S.Ct. at 2504. Under the PSLRA's heightened pleading requirements, any private securities complaint alleging that the defendant made a false or misleading statement must:
(1) ... specify each statement alleged to have been misleading, the reason or reasons why the statement is misleading, and, if an allegation regarding the statement or omission is made on information and belief, the complaint shall state with particularity all facts on which that belief is formed [and]
(2) ... state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind.
15 U.S.C. § 78u-4(b)(1), (2) (emphasis added). In other words, the PSLRA "requires plaintiffs to state with particularity both the facts constituting the alleged violation, and the facts evidencing scienter, i.e., the defendant's intention `to deceive, manipulate or defraud.'" Tellabs, 127 S.Ct. at 2504 (quoting Ernst & Ernst v. Hochfelder, 425 U.S. 185, 194, 96 S.Ct. 1375, 47 L.Ed.2d 668 (1976)).
Although the PSLRA left the term undefined, the Supreme Court has concluded that Congress adopted the "strong inference" standard in order to raise the bar for pleading scienter. Tellabs, 127 S.Ct. at 2509. In doing so, the PSLRA "implement[ed] procedural protections to discourage frivolous litigation." Helwig v. Vencor, Inc., 251 F.3d 540, 547 (6th Cir. 2001).
In Tellabs, the Supreme Court prescribed a specific three-step analysis that district courts are to follow in considering a motion to dismiss private securities claims arising under Section 10(b). First, "courts must, as with any motion to dismiss for failure to plead a claim on which relief can be granted, accept all factual allegations in the complaint as true." Tellabs, 127 S.Ct. at 2509. Second, "courts must consider the complaint in its entirety, as well as other sources courts ordinarily examine when ruling on Rule 12(b)(6) motions to dismiss, in particular, documents incorporated into the complaint by reference, and matters of which a court may take judicial notice." Id. (citation omitted). At the second stage, the relevant question "is whether all of the facts alleged, taken collectively, give rise to a strong inference of scienter, not whether any individual allegation, scrutinized in isolation, meets that standard." Id. (emphasis in original). The PSLRA does not permit a plaintiff merely "to allege facts from which an inference of scienter rationally could be drawn." Id. at 2510. Rather, the inference of scienter "must be cogent and compelling, thus strong in light of other explanations." Id.
Finally, in determining whether the pleaded facts give rise to a strong inference of scienter, "the court must take into account plausible opposing inferences." *571 Id. at 2509. Because the strength of an inference "cannot be decided in a vacuum," the district court must conduct a "comparative inquiry" and assess the possible competing inferences that could be drawn from the allegations, including "plausible nonculpable explanations for the defendant's conduct, as well as inferences favoring the plaintiff." Id. at 2509-10.
In defining how this framework is to be applied, the Supreme Court expressly held that a complaint will survive a motion to dismiss so long as "a reasonable person would deem the inference of scienter cogent and at least as compelling as any opposing inference one could draw from the facts alleged." Id. at 2510 (emphasis added). Thus, where two equally compelling inferences can be drawn, one demonstrating scienter and the other supporting a nonculpable explanation, Tellabs instructs that the complaint should be permitted to move forward. See id. at 2510 n. 5; ACA Fin. Guar. Corp. v. Advest, Inc., 512 F.3d 46, 59 (1st Cir.2008) ("In other words, where there are equally strong inferences for and against scienter, Tellabs now awards the draw to the plaintiff.").

IV.
It is this final aspect of Tellabs that we confront here.[2] In articulating the controlling pleading standard, the district court stated that it was "required to accept plaintiff's inferences of scienter only if those inferences are the most plausible of competing inferences." Frank, 525 F.Supp.2d at 930 (emphasis added). The district court explained that, "under Tellabs, plaintiff must establish an inference of scienter that is more plausible and powerful than competing inferences of defendants' state of mind." Id. at 928 (emphasis added). This standard plainly is at odds with the Supreme Court's holding in Tellabs that inferences of scienter that are "at least as compelling" as competing nonculpable inferences are sufficient for the complaint to survive a motion to dismiss.
The district court's "most plausible" standard is derived from this Court's decision in Helwig, where the en banc Court held that "the `strong inference' requirement means that plaintiffs are entitled only to the most plausible of competing inferences." 251 F.3d at 553. After Tellabs, however, the standard adopted in Helwig is no longer good law. 127 S.Ct. at 2510 (expressly rejecting the "most plausible of competing inferences" standard applied in Fidel v. Farley, 392 F.3d 220, 227 (6th Cir.2004), and Helwig, 251 F.3d at 553).

V.
Because the "most plausible" pleading standard applied by the district court is at odds with Tellabs, we hereby VACATE the judgment of the district court and REMAND the case to the district court to consider whether Plaintiffs have made allegations that support an inference of scienter that is "at least as compelling" as competing nonculpable inferences.
NOTES
[1]  Pursuant to 15 U.S.C. § 7241, Dana's Sarbanes-Oxley certifications stated that the financial report being certified "does not contain any untrue statement of material fact," and that each of the financial statements "fairly present in all material respects" the company's financial condition during the reporting period.
[2]  Because we vacate on other grounds, we do not address whether the district court erred in entering judgment without considering Plaintiffs' informal request to amend the complaint.