1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 SOUTHERN DISTRICT OF CALIFORNIA 9 10 SCOTT KUHNE, individually and on Case No.: 3:20-cv-00649-DMS-DEB 11 behalf of all others similarly situated, 12 ORDER PRELIMINARILY Plaintiff, APPROVING SETTLEMENT AND 13 AUTHORIZING DISSEMINATION 14 v. OF NOTICE TO THE CLASS 15 GOSSAMER BIO, INC., SHEILA 16 GUJRATHI, M.D., BRYAN 17 GIRAUDO, FAHEEM HASNAIN, JOSHUA H. BILENKER, M.D., 18 KRISTINA BUROW, RUSSELL 19 COX, THOMAS DANIEL, M.D., RENEE GALA, OTELLO 20 STAMPACCHIA, Ph.D., MERRILL 21 LYNCH, PIERCE, FENNER & SMITH INCORPORATED, SVB 22 LEERINK LLC, BARCLAYS 23 CAPITAL INC., and EVERCORE 24 GROUP L.L.C., 25 Defendants. 26 27 28 1 WHEREAS, a class action is pending in this Court entitled Kuhne v. 2 Gossamer Bio, Inc., et al., Case No. 3:20-cv-00649-DMS-DEB (the “Action”); 3 WHEREAS, (a) Lead Plaintiff Scott Kuhne (“Lead Plaintiff”), on behalf of 4 himself and the Class (defined below) and (b) Defendants Gossamer Bio, Inc. 5 (“Gossamer” or “the Company”), Sheila Gujrathi, M.D., Bryan Giraudo, Faheem 6 Hasnain, Joshua H. Bilenker, M.D., Kristina Burow, Russell Cox, Thomas Daniel, 7 M.D., Renee Gala, Otello Stampacchia, Ph.D, Merrill Lynch, Pierce, Fenner & 8 Smith Incorporated, SVB Leerink LLC, Barclays Capital Inc., and Evercore Group 9 L.L.C. (the “Defendants”) (collectively with Lead Plaintiff, the “Settling Parties”) 10 have determined to settle all claims asserted against Defendants in this Action with 11 prejudice on the terms and conditions set forth in the Stipulation and Agreement of 12 Class Action Settlement dated February 1, 2022 (the “Stipulation”) (ECF No. 66-2) 13 subject to approval of this Court (the “Settlement”); 14 WHEREAS, the Settling Parties having made application, pursuant to Federal 15 Rule of Civil Procedure 23(e), for an order preliminarily approving the settlement of 16 the Action, in accordance with the Stipulation; 17 WHEREAS, the Court has read and considered: (a) Lead Plaintiff’s motion 18 for preliminary approval of the Settlement and authorizing dissemination of notice 19 to the Class and the papers filed and arguments made in connection therewith (ECF 20 Nos. 66, 66-1); and (b) the Stipulation and the exhibits attached thereto (ECF Nos. 21 66-2–66-6); and 22 WHEREAS, the proposed settlement: “(1) appears to be the product of 23 serious, informed, non-collusive negotiations; (2) has no obvious deficiencies; (3) 24 does not improperly grant preferential treatment to class representatives or segments 25 of the class; and (4) falls within the range of possible approval[,]” Romero v. Securus 26 Techs, Inc., No. 16-cv-1283 JM (MDD), 2020 WL 3250599, at *5 (S.D. Cal. June 27 16, 2020) (internal quotations omitted); and 28 1 WHEREAS, unless otherwise defined herein, all capitalized words contained 2 herein shall have the same meanings as they have in the Stipulation. 3 NOW THEREFORE, IT IS HEREBY ORDERED: 4 1. Provisional Certification of the Settlement Class – Pursuant to Rules 5 23(a) and (b)(3) of the Federal Rules of Civil Procedure, and for the purposes of this 6 settlement only, the Action is hereby preliminarily certified as a class action on 7 behalf of: all Persons who purchased Gossamer common stock between February 8, 8 2019 and December 13, 2020, inclusive (the “Class Period”), and/or who acquired 9 Gossamer shares pursuant or traceable to Gossamer’s Registration Statement and 10 Prospectus in connection with the IPO. Excluded from the Class are Defendants and 11 their families, the officers, directors, and affiliates, and their legal representatives, 12 heirs, successors or assigns, and any entity in which Defendants have or had a 13 controlling interest. The foregoing exclusion shall not cover Investment Vehicles. 14 2. Also excluded from the Class are the Persons who timely and validly 15 seek exclusion from the Class pursuant to the requirements described below and in 16 the Notice to be sent to Class Members pursuant to this Order. 17 3. The Court finds, for the purposes of the Settlement only, that the 18 prerequisites for a class action under Rules 23(a) and (b)(3) of the Federal Rules of 19 Civil Procedure have been satisfied. The (a) number of Class Members is so 20 numerous that joinder of all members is impracticable, given that millions of shares 21 were sold during the class period (ECF No. 66-1 at 20), tending to indicate a 22 sufficiently large class that makes joinder “impracticable.” Fed. R. Civ. P. 23(a)(1). 23 There (b) are questions of law and fact common to the Class, centered on whether 24 Defendants’ SEC filings failed to disclose material facts (ECF No. 66-1 at 21) and 25 (c) the claims of Lead Plaintiff Scott Kuhne are typical of the claims of the Class he 26 seeks to represent. (Id. at 22.) Both (d) Lead Plaintiff and Lead Counsel have and 27 will fairly and adequately represent the interests of the Class, given that Lead 28 Plaintiff’s interests are aligned with the class and Proposed Class Counsel is 1 experienced in securities class action litigation. (Id. at 23). The (e) the questions of 2 law and fact common to members of the Class—centered on whether there was a 3 misrepresentation or omission and whether it was material—predominate over any 4 questions affecting only individual members of the Class, and (f) a class action is 5 superior to other available methods for the fair and efficient adjudication of the 6 controversy, given geographically dispersed investors with likely small individual 7 damages. (Id. at 23–24). 8 4. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, and solely 9 for the purposes of effectuating the Settlement, Lead Plaintiff is appointed as 10 representative for the Class and Lead Counsel is appointed as counsel for the Class. 11 Solely for the purposes of effectuating the proposed Settlement, Lead Counsel is 12 authorized to act on behalf of Lead Plaintiff and the other Class Members with 13 respect to all acts or consents required by or that may be given pursuant to the 14 Stipulation, including all acts that are reasonably necessary to consummate the 15 Settlement. 16 5. Preliminary Approval of the Settlement – The Court hereby 17 preliminarily approves the Settlement, as embodied in the Stipulation, as being fair, 18 reasonable and adequate to the Class, subject to further consideration at the 19 Settlement Hearing to be conducted as described below. 20 6. Settlement Hearing – The Court will hold a settlement hearing (the 21 “Settlement Hearing”) on Friday, June 24, 2022 at 1:00 p.m. at the United States 22 District Court for the Southern District of California, 333 West Broadway, San 23 Diego, CA 92101, Courtroom 13-A, for the following purposes: (a) to determine 24 whether the proposed Settlement on the terms and conditions provided for in the 25 Stipulation is fair, reasonable and adequate to the Class, and should be approved by 26 the Court; (b) to determine whether a Judgment substantially in the form attached as 27 Exhibit B to the Stipulation should be entered dismissing the Action with prejudice 28 against Defendants; (c) to determine whether the proposed Plan of Allocation for the 1 proceeds of the Settlement is fair and reasonable and should be approved; (d) to 2 determine whether the motion by Lead Counsel for an award of attorneys’ fees and 3 reimbursement of Litigation Expenses should be approved; and (e) to consider any 4 other matters that may properly be brought before the Court in connection with the 5 Settlement. Notice of the Settlement and the Settlement Hearing (“Notice”) shall be 6 given to Class Members as set forth in paragraph 8 of this Order. 7 7. Retention of Claims Administrator and Manner of Giving Notice – 8 Lead Counsel is hereby authorized to retain Angeion Group (the “Claims 9 Administrator”) to supervise and administer the notice procedure in connection with 10 the proposed Settlement as well as the processing of Claims as more fully set forth 11 below. Notice of the Settlement and the Settlement Hearing shall be given by Lead 12 Counsel as follows: 13 (a) not later than twenty (20) business days after the date of entry of 14 this Order (the “Notice Date”), Lead Counsel shall cause the Claims Administrator 15 to mail the Notice, substantially in the form attached hereto as Exhibit A-1, and 16 Claim Form, substantially in the form attached hereto as Exhibit A-2, to those 17 members of the Class as may be identified through reasonable effort; 18 (b) contemporaneously with the mailing of the Notice, Lead Counsel 19 shall also cause the Claims administrator to post downloadable copies of the Notice 20 and Claim Form online at www.GossamerSecuritiesLitigation.com; 21 (c) not later than ten (10) business days after the Notice Date, Lead 22 Counsel shall cause the Claims Administrator to cause the Summary Notice, 23 substantially in the form attached hereto as Exhibit A-3, to be published once in the 24 national edition of The Wall Street Journal and once over a national newswire 25 service; and 26 (d) not later than seven (7) calendar days prior to the Settlement 27 Hearing, Lead Counsel shall serve on Defendants’ Counsel and file with the Court 28 proof, by affidavit or declaration, of such mailing and publication. 1 8. Approval of Form and Content of Notice – The Court (a) approves, 2 as to form and content, the Notice, the Claim Form, and the Summary Notice, 3 attached hereto as Exhibits A-1, A-2, and A-3, respectively, and (b) finds that the 4 mailing and distribution of the Notice, the posting of the Notice and Claim Form 5 online, and the publication of the Summary Notice in the manner and form set forth 6 in paragraph 8 of this Order (i) is the best notice practicable under the circumstances; 7 (ii) constitutes notice that is reasonably calculated, under the circumstances, to 8 apprise Class Members of: the pendency of the Action; of the effect of the proposed 9 Settlement (including the Releases to be provided thereunder); of Lead Counsel’s 10 motion for an award of attorneys’ fees and reimbursement of Litigation Expenses; 11 of Class Members’ right to object to the Settlement, the Plan of Allocation and/or 12 Lead Counsel’s motion for attorneys’ fees and reimbursement of Litigation 13 Expenses; of Class Members’ right to exclude themselves from the Class; and of 14 Class Members’ right to appear at the Settlement Hearing; (iii) constitutes due, 15 adequate and sufficient notice to all persons and entities entitled to receive notice of 16 the proposed Settlement; and (iv) satisfies the requirements of Rule 23 of the Federal 17 Rules of Civil Procedure, the United States Constitution (including the Due Process 18 Clause), the Private Securities Litigation Reform Act of 1995, 15 U.S.C. § 77z- 19 1(a)(7), as amended, and all other applicable law and rules. The date and time of the 20 Settlement Hearing shall be included in the Notice and Summary Notice before they 21 are mailed, posted online, and published, respectively. 22 9. Nominee Procedures – Brokers and other nominees who purchased or 23 otherwise acquired Gossamer common stock during the Class Period for the benefit 24 of another Person shall (a) within seven (7) calendar days of receipt of the Notice, 25 request from the Claims Administrator sufficient copies of the Notice to forward to 26 all such beneficial owners and within seven (7) calendar days of receipt of those 27 Notices forward them to all such beneficial owners; or (b) within seven (7) calendar 28 days of receipt of the Notice, send a list of the names and addresses of all such 1 beneficial owners to the Claims Administrator in which event the Claims 2 Administrator shall promptly mail the Notice to such beneficial owners. Upon full 3 compliance with this Order, such nominees may seek reimbursement of their 4 reasonable expenses actually incurred in complying with this Order, by providing 5 the Claims Administrator with proper documentation supporting the expenses for 6 which reimbursement is sought. Such properly documented expenses incurred by 7 nominees in compliance with the terms of this Order shall be paid from the 8 Settlement Fund, with any disputes as to the reasonableness or documentation of 9 expenses incurred subject to review by the Court. 10 10. Participation in the Settlement – Class Members who wish to 11 participate in the Settlement and to be eligible to receive a distribution from the Net 12 Settlement Fund must complete and submit a Claim Form in accordance with the 13 instructions contained therein. Unless the Court orders otherwise, all Claim Forms 14 must be postmarked no later than ninety (90) calendar days after the Notice Date. 15 Notwithstanding the foregoing, Lead Counsel may, at its discretion, accept for 16 processing late Claims provided such acceptance does not delay the distribution of 17 the Net Settlement Fund to the Class. By submitting a Claim, a Person shall be 18 deemed to have submitted to the jurisdiction of the Court with respect to his, her or 19 its Claim and the subject matter of the Settlement. 20 11. Each Claim Form submitted must satisfy the following conditions: (a) 21 it must be properly completed, signed and submitted in a timely manner in 22 accordance with the provisions of the preceding paragraph; (b) it must be 23 accompanied by adequate supporting documentation for the transactions and 24 holdings reported therein, in the form of broker confirmation slips, broker account 25 statements, an authorized statement from the broker containing the transactional and 26 holding information found in a broker confirmation slip or account statement, or 27 such other documentation as is deemed adequate by Lead Counsel or the Claims 28 Administrator; (c) if the person executing the Claim Form is acting in a 1 representative capacity, a certification of his, her or its current authority to act on 2 behalf of the Class Member must be included in the Claim Form to the satisfaction 3 of Lead Counsel or the Claims Administrator; and (d) the Claim Form must be 4 complete and contain no material deletions or modifications of any of the printed 5 matter contained therein and must be signed under penalty of perjury. 6 12. Any Class Member that does not timely and validly submit a Claim 7 Form or whose Claim is not otherwise approved by the Court: (a) shall be deemed 8 to have waived his, her or its right to share in the Net Settlement Fund; (b) shall be 9 forever barred from participating in any distributions therefrom; (c) shall be bound 10 by the provisions of the Stipulation and the Settlement and all proceedings, 11 determinations, orders and judgments in the Action relating thereto, including, 12 without limitation, the Judgment or Alternate Judgment, if applicable, and the 13 Releases provided for therein, whether favorable or unfavorable to the Class; and (d) 14 will be barred from commencing, maintaining or prosecuting any of the Released 15 Claims against each and all of the Released Defendant Parties, as more fully 16 described in the Stipulation and Notice. Notwithstanding the foregoing, late Claim 17 Forms may be accepted for processing as set forth in paragraph 11 above. 18 13. Exclusion From the Class – Any member of the Class who wishes to 19 exclude himself, herself or itself from the Class must request exclusion in writing 20 within the time and in the manner set forth in the Notice, which shall provide that: 21 (a) any such request for exclusion from the Class must be mailed or delivered such 22 that it is received no later than twenty-one (21) calendar days prior to the Settlement 23 Hearing, to: 24 Gossamer Securities Litigation Settlement, 25 EXCLUSIONS, c/o ____________________, P.O. Box 26 ______, ____________, __ _____-____, 27 and (b) each request for exclusion must (i) state the name, address, and telephone 28 number of the Person requesting exclusion, and in the case of entities, the name and 1 telephone number of the appropriate contact person; (ii) state that such Person 2 “requests exclusion from the Settlement Class in Kuhne v. Gossamer Bio, Inc., et 3 al., Case No. 3:20-cv-00649-DMS-DEB”; (iii) state the number of shares of 4 Gossamer common stock that the Person requesting exclusion purchased/acquired 5 and/or sold during the Class Period, as well as the dates and prices of each such 6 purchase/acquisition and sale; and (iv) be signed by the Person requesting exclusion 7 or an authorized representative. A request for exclusion shall not be effective unless 8 it provides all the required information and is received within the time stated above, 9 or is otherwise accepted by the Court. 10 14. Any Person who timely and validly requests exclusion in compliance 11 with the terms stated in this Order and is excluded from the Class shall not be a Class 12 Member, shall not be bound by the terms of the Settlement or any orders or 13 judgments in the Action and shall not receive any payment out of the Net Settlement 14 Fund. 15 15. Any Class Member who or which does not timely and validly request 16 exclusion from the Class in the manner stated in this Order: (a) shall be deemed to 17 have waived his, her or its right to be excluded from the Class; (b) shall be forever 18 barred from requesting exclusion from the Class in this or any other proceeding; (c) 19 shall be bound by the provisions of the Stipulation and Settlement and all 20 proceedings, determinations, orders and judgments in the Action, including, but not 21 limited to, the Judgment or Alternate Judgment, if applicable, and the Releases 22 provided for therein, whether favorable or unfavorable to the Class; and (d) will be 23 barred from commencing, maintaining or prosecuting any of the Released Claims 24 against any of the Released Defendant Parties, as more fully described in the 25 Stipulation and Notice. 26 16. Appearance and Objections at Settlement Hearing – Any Class 27 Member who does not request exclusion from the Class may enter an appearance in 28 the Action, at his, her or its own expense, individually or through counsel of his, her 1 or its own choice, by filing with the Clerk of Court and delivering a notice of 2 appearance to both Lead Counsel and Defendants’ Counsel, at the addresses set forth 3 in paragraph 18 below, such that it is received no later than twenty-one (21) calendar 4 days prior to the Settlement Hearing, or as the Court may otherwise direct. Any 5 Class Member who does not enter an appearance will be represented by Lead 6 Counsel. 7 17. Any Class Member who does not request exclusion from the Class may 8 file a written objection to the proposed Settlement, the proposed Plan of Allocation, 9 and/or Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of 10 Litigation Expenses and appear and show cause, if he, she or it has any cause, why 11 the proposed Settlement, the proposed Plan of Allocation and/or Lead Counsel’s 12 motion for attorneys’ fees and reimbursement of Litigation Expenses should not be 13 approved; provided, however, that no Class Member shall be heard or entitled to 14 contest the approval of the terms and conditions of the proposed Settlement, the 15 proposed Plan of Allocation and/or the motion for attorneys’ fees and reimbursement 16 of Litigation Expenses unless that Person has filed a written objection with the Court 17 and served copies of such objection on Lead Counsel and Defendants’ Counsel at 18 the addresses set forth below such that they are received no later than twenty-one 19 (21) calendar days prior to the Settlement Hearing. 20 Lead Counsel Defendants’ Counsel 21 22 Block & Leviton LLP Latham & Watkins LLP 23 Jacob A. Walker Colleen C. Smith 260 Franklin Street, Suite 1860 12670 High Bluff Drive 24 Boston, MA 02110 San Diego, CA 92130 25 26 27 18. Any objections, filings and other submissions by the objecting Class 28 Member: (a) must state the name, address, and telephone number of the Person 1 objecting and must be signed by the objector; (b) must contain a statement of the 2 Class Member’s objection or objections, and the specific reasons for each objection, 3 including any legal and evidentiary support the Class Member wishes to bring to the 4 Court’s attention; and (c) must include documents sufficient to prove membership 5 in the Class, including the number of shares of Gossamer common stock that the 6 objecting Class Member purchased/acquired and/or sold during the Class Period, as 7 well as the dates and prices of each such purchase/acquisition and sale. Objectors 8 who enter an appearance and desire to present evidence at the Settlement Hearing in 9 support of their objection must include in their written objection or notice of 10 appearance the identity of any witnesses they may call to testify and any exhibits 11 they intend to introduce into evidence at the hearing. 12 19. Any Class Member who or which does not make his, her or its objection 13 in the manner provided herein shall be deemed to have waived his, her or its right to 14 object to any aspect of the proposed Settlement, the proposed Plan of Allocation, 15 and Lead Counsel’s motion for an award of attorneys’ fees and reimbursement of 16 Litigation Expenses and shall be forever barred and foreclosed from objecting to the 17 fairness, reasonableness or adequacy of the Settlement, the Plan of Allocation or the 18 requested attorneys’ fees and Litigation Expenses, or from otherwise being heard 19 concerning the Settlement, the Plan of Allocation or the requested attorneys’ fees 20 and Litigation Expenses in this or any other proceeding. 21 20. Stay and Temporary Injunction – Until otherwise ordered by the 22 Court, the Court stays all proceedings in the Action other than proceedings necessary 23 to carry out or enforce the terms and conditions of the Stipulation. Pending final 24 determination of whether the Settlement should be approved, the Court bars and 25 enjoins Lead Plaintiff, and all other members of the Class, from commencing or 26 prosecuting any and all of the Released Claims against each and all of the Released 27 Defendant Parties. 28 21. Settlement Administration Fees and Expenses – All reasonable costs 1 incurred in identifying Class Members and notifying them of the Settlement as well 2 as in administering the Settlement shall be paid as set forth in the Stipulation without 3 further order of the Court. 4 22. Settlement Fund – The contents of the Settlement Fund held by 5 Huntington Bank (which the Court approves as the Escrow Agent), shall be deemed 6 and considered to be in custodia legis of the Court, and shall remain subject to the 7 jurisdiction of the Court, until such time as they shall be distributed pursuant to the 8 Stipulation and/or further order(s) of the Court. 9 23. Taxes – Lead Counsel is authorized and directed to prepare any tax 10 returns and any other tax reporting form for or in respect to the Settlement Fund, to 11 pay from the Settlement Fund any Taxes owed with respect to the Settlement Fund, 12 and to otherwise perform all obligations with respect to Taxes and any reporting or 13 filings in respect thereof without further order of the Court in a manner consistent 14 with the provisions of the Stipulation. 15 24. Termination of Settlement – If the Settlement is terminated as 16 provided in the Stipulation, the Settlement is not approved, or the Effective Date of 17 the Settlement otherwise fails to occur, this Order shall be vacated, rendered null and 18 void and be of no further force and effect, except as otherwise provided by the 19 Stipulation, and this Order shall be without prejudice to the rights of the Lead 20 Plaintiff, the other Class Members and Defendants, and the Parties shall revert to 21 their respective positions in the Action as of October 15, 2021, as provided in the 22 Stipulation. 23 25. Use of this Order – Neither this Order, the Term Sheet, the Stipulation 24 (whether or not consummated), including the exhibits thereto and the Plan of 25 Allocation contained therein (or any other plan of allocation that may be approved 26 by the Court), the negotiations leading to the execution of the Term Sheet and the 27 Stipulation, nor any proceedings taken pursuant to or in connection with the Term 28 Sheet, the Stipulation and/or approval of the Settlement (including any arguments 1 proffered in connection therewith): (a) shall be offered against any of the Released 2 Defendant Parties as evidence of, or construed as, or deemed to be evidence of any 3 presumption, concession, or admission by any of the Released Defendant Parties 4 with respect to the truth of any fact alleged by Lead Plaintiff or the validity of any 5 claim that was or could have been asserted or the deficiency of any defense that has 6 been or could have been asserted in this Action or in any other litigation, or of any 7 liability, negligence, fault, or other wrongdoing of any kind of any of the Released 8 Defendant Parties or in any way referred to for any other reason as against any of 9 the Released Defendant Parties, in any civil, criminal or administrative action or 10 proceeding, other than such proceedings as may be necessary to effectuate the 11 provisions of the Stipulation; (b) shall be offered against any of the Released 12 Plaintiff Parties, as evidence of, or construed as, or deemed to be evidence of any 13 presumption, concession or admission by any of the Released Plaintiff Parties that 14 any of their claims are without merit, that any of the Released Defendant Parties had 15 meritorious defenses, or that damages recoverable under the Complaint would not 16 have exceeded the Settlement Amount, or with respect to any liability, negligence, 17 fault or wrongdoing of any kind, or in any way referred to for any other reason as 18 against any of the Released Plaintiff Parties, in any civil, criminal or administrative 19 action or proceeding, other than such proceedings as may be necessary to effectuate 20 the provisions of the Stipulation; or (c) shall be construed against any of the 21 Releasees as an admission, concession, or presumption that the consideration to be 22 given under the Settlement represents the amount which could be or would have 23 been recovered after trial; provided, however, that if the Stipulation is approved by 24 the Court, the Settling Parties and the Releasees and their respective counsel may 25 refer to it to effectuate the protections from liability granted thereunder or otherwise 26 to enforce the terms of the Settlement. 27 26. Supporting Papers – Lead Counsel shall file and serve the opening 28 papers in support of the proposed Settlement, the Plan of Allocation, and Lead 1 Counsel’s motion for an award of attorneys’ fees and reimbursement of Litigation 2. Expenses no later than thirty-five (35) calendar days prior to the Settlement Hearing; 3. and reply papers, if any, shall be filed and served no later than seven (7) calendar 4 days prior to the Settlement Hearing. 5 27. The Court retains jurisdiction to consider all further applications arising 6 out of or connected with the proposed Settlement. 7 28. In accordance with the Settlement, the Court hereby adopts the 8 following dates for performance: 9 10 12 “Notice Date’) 14 newswire 19 17 objections 18 19 21 Forms 22 23 IT IS SO ORDERED. 24. Dated: March 14, 2022 gf p 25 4”: Hon. Dana M. Sabraw, Chief Judge United States District Court 27 28