June 6, 2001. However, during the some five and one-third months immediately preceding the June 7, 2001 IPO, natural gas prices had in fact declined approximately 60%. That information was not included anywhere in the prospectus. Though it did discuss the volatile nature of oil and natural gas prices, the prospectus made no mention of any particular decline in the price of natural gas.


6
During the two month period after the issuance of the IPO, Torch's share prices declined to below $8 per share. On August 2, 2001, Torch issued a press release stating that during the period after the IPO, domestic natural gas and crude oil prices declined. The press release also noted that Torch had begun to note delays in the completion of shallow water drilling projects.


7
OnLucia asserted that although those statements in the prospectus were true, they were misleading to a reasonable investor, because the prospectus failed to disclose that during the six years immediately preceding the offering, the yield of the junk bonds had in fact been lower than the yield of Treasury bonds. Id. at 173. The First Circuit reversed the district court's conclusion that the representations were not misleading because they were literally true, and held that a determination of whether the prospectus statements were misleading due to failure to disclose the rates in the six year time period was a factual question, and therefore inappropriate for resolution on a motion to dismiss. The court stated:


22
"the six years at issue are the six years leading up to the fund's public