Gorsline v. Nutanix, Inc. ( 2023 )

UNITED STATES DISTRICT COURT 1 NORTHERN DISTRICT OF CALIFORNIA 2 Case No. 4:23-cv-01827-YGR 3 ALEXANDER GORSLINE, Individually 4 and On Behalf of All Others Similarly ORDER APPOINTING LEAD PLAINTIFF AND Situated, APPROVING SELECTION OF LEAD 5 Plaintiff, COUNSEL Re: Dkt. No. 12, 27 6 vs. 7 NUTANIX, INC., RAJIV RAMASWAMI, 8 DUSTON WILLIAMS, and RUKMINI SIVARAMAN, 9 Defendants. 10 11 Now before the Court is movant Alexander Gorsline’s motion for appointment of lead 12 plaintiff, and for approval of his selection of lead counsel. (Dkt. No. 12.) For the reasons set forth 13 below, the motion is GRANTED.1 14 I. APPOINTMENT OF LEAD PLAINTIFF 15 The PSLRA instructs district courts “to select as lead plaintiff the one ‘most capable of 16 adequately representing the interests of class members.’” In re Cavanaugh, 306 F.3d 726, 729 17 (9th Cir. 2002) (quoting 15 U.S.C. § 78u-4(a)(3)(B)(i)). This is done through a three-step process. 18 “The first step consists of publicizing the pendency of the action, the claims made and the 19 purported class period. 15 U.S.C. § 78u–4(a)(3)(A). The first plaintiff to file an action covered by 20 the Reform Act must post this notice ‘in a widely circulated national business-oriented publication 21 or wire service.’ 15 U.S.C. § 78u–4(a)(3)(A)(i). The notice must also state that ‘any member of 22 the purported class may move the court to serve as lead plaintiff.’ 15 U.S.C. § 78u– 23 4(a)(3)(A)(i)(II).” Id. 24 The second step requires the Court to “consider the losses allegedly suffered by the various 25 plaintiffs” and to choose the “‘presumptively most adequate plaintiff.’” Id. The “most capable” 26 1 Pursuant to Federal Rule of Civil Procedure 78(b) and Civil Local Rule 7-1(b), the Court finds this motion appropriate for decision without oral argument. See Lake at Las Vegas Investors 27 Group, Inc. v. Pacific Malibu Dev. Corp., 933 F.2d 724, 729 (9th Cir. 1991). Accordingly, the 1 plaintiff is generally “the one who has the greatest financial stake in the outcome of the case, so 2 long as he meets the requirements of [Federal Rule of Civil Procedure] 23.” Id. “In other words, 3 the district court must compare the financial stake of the various plaintiffs and determine which 4 one has the most to gain from the lawsuit. It must then focus its attention on that plaintiff and 5 determine, based on the information [plaintiff] has provided in his pleadings and declarations, 6 whether he satisfies the requirements of Rule 23(a), in particular those of ‘typicality’ and 7 ‘adequacy.’” Id. at 730. 8 The third step of the process is to give other plaintiffs an opportunity to rebut the 9 presumptive lead plaintiff's showing that it satisfies Rule 23’s typicality and adequacy 10 requirements. 15 U.S.C. § 78u–4(a)(3)(B)(iii)(II). 11 The Court finds the first step is met here. On April 14, 2023, counsel for Gorsline 12 published the required notice in Globe Newswire. As required, it announced that this action was 13 filed and advised other plaintiffs that they have 60 days from the date of the notice to file a motion 14 to be appointed as lead plaintiff. (Dkt. No. 12-2, Pafiti Decl. at Ex B.) 15 The Court also finds the second step is met here. Gorsline submitted a declaration 16 certifying that he purchased 6,000 shares of Nutanix stock during the Class Period at a cost of 17 $174,658, retained that stock through the class period, and suffered losses of approximately 18 $15,658 on his investments in Nutanix stock during the class period. (See Dkt. No. 12 at 2.) The 19 Court has reviewed the supporting materials, and takes note that no other plaintiff has challenged 20 Gorsline’s claim, and finds that Gorsline has alleged the most financial loss. 21 Gorsline has also made a prima facie showing of typicality and adequacy under Rule 23(a). 22 The typicality requirement is readily satisfied as Gorsline’s claims arise out of the same events and 23 are based on the same legal theories as the claims of other class members. See Hanlon v. Chrysler 24 Corp., 150 F.3d 1011, 1020 (9th Cir. 1998) (“[R]epresentative claims are ‘typical’ if they are 25 reasonably co-extensive with those of absent class members; they need not be substantially 26 identical.”). As the plaintiff with the highest financial interest, he has a strong incentive to pursue 27 vigorously a substantial recovery for all putative class members. See Takeda v. Turbodyne Techs., ] is ‘adequate’ when counsel for the class is qualified and competent, the representative’s interests 2 || are not antagonistic to the interests of absent class members, and it is unlikely that the action is 3 || collusive.”) (citing in re N. Dist. of Cal., Dalkon Shield IUD Prods. Liab. Litig., 693 F.2d 847, 855 4 |} (9th Cir. 1982)). 5 As no alternative plaintiffs have come forth in this action, the third step also weighs in 6 || favor of appointing Gorsline as lead plaintiff. Accordingly, the motion is GRANTED as to the 7 || appointment of Gorsline as lead plaintiff. 8 || IL. APPROVAL OF SELECTION OF LEAD COUNSEL 9 Section 78u-4(a)(3)(B)(v) provides: “The most adequate plaintiff shall, subject to the 10 || approval of the court, select and retain counsel to represent the class.” Here, Gorsline has selected 11 Pomerantz LLP to serve as lead counsel. (Dkt. No. 12 at 10-11.) Pomerantz has significant 12 || experience litigating securities class actions. (/d.; Pafiti Decl., Ex. D).) Because Gorsline has 13 made a “reasonable choice of counsel,” the Court will “defer to that choice.” See Cohen vy. U.S. 14 || Dist. Court for N. Dist. of Cal., 586 F.3d 703, 712 (9th Cir. 2009). 3 15 Il. CONCLUSION 16 The Court APPOINTS Gorsline as lead plaintiff and APPOINTS Pomerantz LLP as lead i 17 || counsel to represent the putative class in this action. Further, in light of the stipulation filed at Z 18 docket number 27, the Court VACATES the CMC set for July 17, 2023. 19 This Order terminates Docket Numbers 12 and 27. 20 IT Is SO ORDERED. 21 22 || Dated: July 12, 2023 LS jpane Hatelf lcs, — 23 VONNE GONZALEZ ROGERS UNITED STATES DISTRICT COURT JUDGE 24 25 26 27 28