Dickerson v. Macmillan ( 2023 )

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BRENNA DICKERSON, Case No. 23-cv-01320-AMO 8 Plaintiff, ORDER GRANTING PLAINTIFF'S 9 v. MOTION TO APPOINT LEAD PLAINTIFF AND LEAD COUNSEL 10 ANDY MACMILLAN, et al., Re: Dkt. Nos. 16, 25 Defendants. 11 12 13 In this putative securities class action, Plaintiff Brenna Dickerson filed a motion to be 14 appointed as lead plaintiff pursuant to the Private Securities Litigation Reform Act (“PSLRA”), 15 15 U.S.C. § 78u-4(a)(3)(B). ECF No. 16. Dickerson also seeks appointment of her counsel, 16 Monteverde & Associates PC (“Monteverde”), as lead counsel for the putative class. Id. The 17 motion is unopposed. For the reasons set forth below, the Court GRANTS Plaintiff’s motion to 18 be appointed as lead plaintiff and GRANTS Plaintiff’s motion to appoint Monteverde as interim 19 lead counsel. 20 I. APPOINTMENT OF LEAD PLAINTIFF 21 The Ninth Circuit has established a three-step process for determining appointment of lead 22 plaintiff in private securities actions arising under the PSLRA. 15 U.S.C. § 78u-4(a)(1); In re 23 Cavanaugh, 306 F.3d 726, 729–30 (9th Cir. 2002); see Mulligan v. Impax Labs, Inc., No. C-13- 24 1037 EMC, 2013 WL 3354420, at *3 (N.D. Cal. July 2, 2013). First, the plaintiff must satisfy the 25 PSLRA’s notice requirement. Within twenty days of filing the complaint, the plaintiff must 26 publish a notice in a widely circulated national business-oriented publication advising members of 27 the putative class of the pending action. 15 U.S.C. § 78u-4(3)(A)(i). The publication must also 1 move the Court to serve as lead plaintiff. Id. Second, the Court must determine the plaintiff 2 “most capable of adequately representing the interests of class members.” 15 U.S.C. 3 § 78u-4(3)(B)(i). There is a rebuttable presumption that the “most adequate plaintiff” is the person 4 who (1) filed the complaint or made a motion in response to the notice; (2) has the largest financial 5 interest; and (3) otherwise satisfies Federal Rule of Civil Procedure 23. 15 U.S.C. 6 § 78u-4(a)(3)(B)(iii)(I); see Cavanaugh, 306 F.3d at 729–30 (describing the PSLRA process for 7 appointing lead plaintiff). Third, putative class members may rebut the presumption that the most 8 adequate plaintiff will satisfy the typicality and adequacy requirements of Rule 23(a). 15 U.S.C. 9 § 78u-4(a)(3)(B)(iii)(II). 10 The Court examines Dickerson’s compliance with these steps. After filing her complaint 11 on March 21, 2023, Dickerson published the required PSLRA notice by PR Newswire on March 12 23, 2023, announcing the litigation and advising class members that they could move for 13 appointment as lead plaintiff within 60 days. ECF No. 16 at 6–7. On May 22, 2023, Dickerson 14 filed the instant motion. Id. Thus, Dickerson has fulfilled the first requirement. 15 U.S.C. 15 § 78u-4(3)(A)(i); see Mulligan, 2013 WL 3354420, at *3. 16 Next, the Court considers whether Dickerson is the most capable of adequately 17 representing the interests of the class members. 15 U.S.C. § 78u-4(3)(B)(i)-(iii). In addition to 18 filing the complaint, Dickerson has alleged—and it is uncontested—that she has the largest 19 financial interest in the litigation. ECF No. 16 at 7; see 15 U.S.C. §78u-4(a)(3)(B)(iii)(I). While 20 the Ninth Circuit “has not provided clear guidance on what metrics district courts should use” in 21 determining which potential plaintiff has the greatest financial interest in the litigation, Mulligan, 22 2013 WL 3354420, at *4, district courts frequently consider four factors, including the number of 23 shares purchased, and the approximate losses suffered, during the class period. Xu v. FibroGen, 24 Inc., No. 21-cv-02623-EMC, 2021 WL 3861454, at *4 (N.D. Cal. Aug. 30, 2021). Dickerson 25 alleges that she owned 100 shares of UserTesting common stock prior to the announcement of its 26 acquisition, which she was forced to exchange at less than fair value. ECF No. 16 at 7. As no 27 other putative class member has claimed a greater financial interest, Dickerson has established that 1 Litig., No. 15-CV-04883-BLF, 2016 WL 3519283, at *3 (N.D. Cal. June 28, 2016). 2 Finally, in determining whether Dickerson is the most adequate plaintiff, the Court must 3 also examine whether Dickerson satisfies the Rule 23 typicality and adequacy requirements. See 4 15 U.S.C. §78u-4(a)(3)(B)(iii)(I); Xu, 2021 WL 3861454, at *7. The typicality requirement 5 considers whether other class members have “the same or similar injury . . . based on conduct 6 which is not unique to the named plaintiffs, and whether other class members have been injured by 7 the same course of conduct.” Melucci v. Corcept Therapeutics Inc., No. 19-CV-01372-LHK, 8 2019 WL 4933611, at *4 (N.D. Cal. Oct. 7, 2019). The adequacy requirement ensures that the 9 plaintiff will “fairly and adequately protect the interests of the class,” Fed. R. Civ. P. 23(a)(4), and 10 ensures that plaintiff and counsel do not have any conflicts of interest with other class members 11 and will “prosecute the action vigorously.” Ellis v. Costco Wholesale Corp., 657 F.3d 970, 985 12 (9th Cir. 2011) (citation omitted). Dickerson alleges that she suffered “the identical harm of being 13 cashed out of her ownership of UserTesting common stock for the unfair acquisition consideration 14 due to the same materially false and misleading statements in the Proxy.” ECF No. 16 at 9. She 15 alleges that she is not subject to any unique defenses and there is no evidence of any conflict of 16 interest between her interests and those of other prospective class members. Id. Further, as 17 detailed below, she has satisfactorily alleged that counsel will pursue the action vigorously. Id. 18 No class members have rebutted the presumption that Dickerson will adequately represent 19 the class. See Mulligan, 2013 WL 3354420 at *9. 20 Because Dickerson has met the statutory requirements for appointment as lead plaintiff, the 21 Court GRANTS Dickerson’s uncontested motion for appointment as lead plaintiff under 15 22 U.S.C. § 78u-4(a)(3). 23 II. APPOINTMENT OF LEAD COUNSEL 24 The PSLRA “expressly provides that lead plaintiff has the power to select lead counsel.” 25 Cohen v. U.S. Dist. Ct. for N. Dist. of California, 586 F.3d 703, 709 (9th Cir. 2009); 15 U.S.C. 26 § 78u-4(a)(3)(B)(v). The Court “generally defer[s]” to lead plaintiff’s reasonable choice of 27 counsel. Id. at 712. Federal Rule of Civil Procedure 23(g)(3) authorizes courts to “designate 1 as a class action.” Fed. R. Civ. P. 23(g)(3).1 Courts typically weigh the factors outlined in Rule 2 23(g)(1)(A): “(i) the work counsel has done in identifying or investigating potential claims in the 3 action; (ii) counsel’s experience in handling class actions, other complex litigation, and the types 4 of claims asserted in the action; (iii) counsel’s knowledge of the applicable law; and (iv) the 5 resources that counsel will commit to representing the class.” Fed. R. Civ. P. 23(g)(1)(A); see 6 Olosoni v. HRB Tax Group, Inc., No. 19-cv-03610-SK, 2019 WL 7576680 at *5 (N.D. Cal. Nov. 7 05, 2019); Levitte v. Google, Inc., No. C 08-03369 JW, 2009 WL 482252, at *2 (N.D. Cal. Feb. 8 25, 2009). The Court may further consider “any other matter pertinent to counsel’s ability to fairly 9 and adequately represent the interests of the class.” Fed. R. Civ. P. 23(g)(1)(B). 10 Dickerson has selected Monteverde to be lead counsel for the class and has established that 11 Monteverde satisfies the Rule 23(g) factors. ECF No. 16 at 9–10; Supplemental Declaration (ECF 12 No. 25) ¶¶ 2–5. Monteverde has investigated the potential claims, including the parties involved, 13 the allegedly false or misleading statements surrounding the company acquisition, and the relevant 14 class period. See Complaint (ECF No. 1) ¶¶ 1–39. Monteverde has established its extensive 15 experience litigating securities class actions, as well as its knowledge of the applicable law. 16 Monteverde specializes in securities class actions, has been recognized as a Top 50 securities class 17 action firm, and has litigated complex securities class actions in this district and other districts 18 across the United States. ECF No. 16 at 9–10; Supp. Decl. ¶¶ 2–4. Finally, Monteverde 19 represents that it committed resources to adequately investigating the claims prior to commencing 20 this action and will continue to do so throughout the pendency of the case. Supp. Decl. ¶¶ 3–5. 21 /// 22 /// 23 /// 24 /// 25 /// 26 27 1 Dickerson seeks appointment of Monteverde as lead counsel. ECF No. 16 at 9. Because the 1 Accordingly, this Court GRANTS Dickerson’s motion for Monteverde to serve as interim 2 class counsel. 3 4 IT IS SO ORDERED. 5 Dated: June 23, 2023 6 □ Quack Wade? ARACELI MARTINEZ-OLGUIN 8 United States District Judge 9 10 11 g 12 123 14 15 16 17 Z 18 19 20 21 22 23 24 25 26 27 28