Dodona I, LLC invested 4 million in two securities offerings from Goldman, Sachs & Co. The investments were in collateralized debt obligations (CDOs). Their value depended on residential mortgage backed securities (RMBS), whose value in turn depended on the performance of subprime residential mortgages. Before making the CDOs, Goldman had notice several "red flags" relating to investments in the subprime markets, in which it had invested heavily. To limit its risk, Goldman began betting against subprime mortgages, RMBS and CDO's; including the CDOs it had sold to Dodona. In other words, Goldman made investments based on the assumption that subprime mortgages and the securities instruments built upon them would decrease in value. In an internal e-mail Goldman official commented that the company had managed to "make some lemonade from some big old lemons." Nevertheless, Goldman's marketing materials provided only boilerplate statements about the risks of investing in the securities. The CDOs were later downgraded to junk status and Dodona I suffered a major loss while Goldman profited.

Assuming that Goldman did not affirmatively misrepresent any facts about the CDO's, can Dodona still recover under SEC Rule 10b-5?