The same duty that applies in a director or officer's dealings with shareholders applies with equal force with respect to their dealings with the corporation itself. See Rowland v. Kable, 174 Va. 343, 366, 6 S.E.2d 633, 642 (1940) ; see also Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D.Va.1999) (“It is well settled that a Virginia corporation's directors and officers owe a duty of loyalty both to the corporation and to the corporation's shareholders.” (quoting WLR Foods v. Tyson Foods, Inc., 869 F.Supp. 419, 421 (W.D.Va.1994) (internal quotations and alterations omitted))).

Directors and officers of Virginia corporations owe fiduciary duties to their corporation and to the corporation's shareholders. Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999); A.I.M. Percolating Corp. v. Ferrodine Chem. Corp., 124 S.E. 442, 445 (Va. 1924). The law considers directors and officers to have a “quasi trust” relation with the corporation and the stockholders as a class, meaning that they “must act in the utmost good faith, and this good faith forbids placing himself in a position where his individual interest clashes with his duty to his corporation.” Rowland v. Kable, 6 S.E.2d 633, 642-43 (Va. 1940).

When confronted with uncertain state law, a federal court must predict what course the highest court in the state would take. Byelick v. Vivadelli, 79 F. Supp. 2d 610, 623 (E.D. Va. 1999). The federal court may base its prediction on "canons of construction, restatements of the law, treatises, recent pronouncements of general rules or policies by the state's highest court, well considered dicta, and the state's trial court decisions."

In re Kaplan, 143 F.3d 807, 812 (3d Cir. 1998); Davis v. U.S. Gypsum Co., 451 F.2d 659, 662 (3d Cir. 1971) ("It is hornbook law that claims asserted for the benefit of stockholders qua stockholders in a corporation because of the tortious acts of its officers or those actions in conjunction with them is a class suit, a derivative action, and recovery is for the benefit of the corporation directly and indirectly to its stockholders. It is equally clear that where a corporation, tortiously conspires with others to damage an individual and does so a cause of action arises which belongs to the individual."); Schupp v. Jump! Info. Technologies, Inc., 65 F. App'x 450, 454 (4th Cir. 2003) (non-precedential) ("Virginia law may permit an individual shareholder to bring an action for breach of fiduciary duty against the directors or officers of a closely held corporation" (citing Byelick v. Vivadelli, 79 F. Supp. 2d 610, 625 (E.D. Va. 1999) (emphasis in original)). While "[b]reach of a fiduciary obligation is a tort claim, and thus requires the showing of a duty, a breach, an injury, and causation," Madsen does not challenge any of these elements.

But even without this finding, the allegation concerning Envion's financial state in April 2012 does not render earlier statements about Carlucci's potential investment return false at the time those statements were made. See Byelick v. Vivadelli, 79 F.Supp.2d 610, 616–17 (E.D.Va.1999) (noting that to prevail on a Section 10(b) claim, the plaintiff must demonstrate that “the defendant made a statement of material fact that was false when made”). For these reasons, that portion of Carlucci's Section 10(b) claim that is timely is dismissed for failure to plead a material misrepresentation with requisite particularity.

The law of Virginia is clear that corporate directors have a fiduciary duty to the corporation and to its shareholders, and they must govern themselves accordingly. Va. Code § 13.1-690;Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999) ("It is well settled that `[a] Virginia corporation's directors and officers owe a duty of loyalty both to the corporation and to the corporation's shareholders.'") (quoting, WLR Foods v. Tyson Foods, Inc., 869 F.Supp. 419, 421 (W.D. Va. 1994)); Glass v. Glass, 228 Va. 39, 47, 321 S.E.2d 69, 74 (1984) ("Corporate officers and directors have a fiduciary duty in their dealings with shareholders and must exercise good faith in such dealings.").

The law of Virginia is clear that corporate directors have a fiduciary duty to the corporation and to its shareholders, and they must govern themselves accordingly. Va. Code § 13.1-690;Byelick v. Vivadelli, 79 F.Supp.2d 610, 623 (E.D. Va. 1999) ("It is well settled that `[a] Virginia corporation's directors and officers owe a duty of loyalty both to the corporation and to the corporation's shareholders.'") (quoting, WLR Foods v. Tyson Foods, Inc., 869 F.Supp. 419, 421 (W.D. Va. 1994)); Glass v. Glass, 228 Va. 39, 47, 321 S.E.2d 69, 74 (1984) ("Corporate officers and directors have a fiduciary duty in their dealings with shareholders and must exercise good faith in such dealings.").