Opinion
Master File No.: C-01-1092-SC.
August 6, 2004.
ABBEY GARDY, LLP, JAMES S. NOTIS (pro hac vice), EVAN J. KAUFMAN, New York, NY, Lead Counsel for Plaintiffs.
LERACH COUGHLIN STOIA ROBBINS LLP, REED R. KATHREIN, SHAWN A. WILLIAMS, San Francisco, CA, Liaison Counsel for Plaintiffs.
COOLEY GODWARD LLP, WILLIAM S. FREEMAN, GRANT P. FONDO, CORY E. MANNING, Palo Alto, CA, Counsel for Defendants Daniel Scharre Frederick D. Lawrence, Donna S. Birks and Peter Maloney.
CLASS ACTION FINAL JUDGMENT AND ORDER OF DISMISSAL WITH PREJUDICE
This matter came before the Court for hearing pursuant to the Court's Order Preliminarily Approving Settlement and Directing Notice to the Class, dated March 25, 2004 (the "Preliminary Approval Order") in the above-captioned consolidated action (the "Litigation"), and on plaintiff's motions for (1) approval of the settlement set forth in the Stipulation of Settlement dated as of December 12, 2003 (the "Stipulation"), (2) approval of the Plan of Allocation of settlement proceeds and (3) an award of attorneys' fees and reimbursement of expenses to plaintiff's counsel. Due and adequate notice having been given to the Class as required in the Preliminary Approval Order, and the Court having considered all papers filed in connection with the settlement and proceedings had herein and otherwise being fully informed in the premises and good cause appearing therefore, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that:
1. This Judgment incorporates by reference the definitions in the Stipulation, and all terms used herein shall have the same meanings as set forth in the Stipulation, as follows:
a. "Adaptive" means AB Liquidating Corporation, formerly known as Adaptive Broadband Corporation.
b. "Authorized Claimant" means any Class Member whose claim for recovery has been allowed pursuant to the terms of the Stipulation.
c. "Claims Administrator" means the firm of Berdon Claims Administration LLC.
d. "Class" means all Persons (other than those Persons who timely and validly request exclusion from the Class) who purchased or otherwise acquired the publicly traded securities of Adaptive during the Class Period, and who were injured thereby, excluding Defendants, and persons and entities related to Defendants, including any subsidiaries or affiliates of Adaptive, the officers and directors of Adaptive during the Class Period, members of Defendants' immediate families, any person, firm, trust, officer, director or any individual or entity in which any of the Defendants has a controlling interest or which is related to, or affiliated with, any of the Defendants, and the legal representatives, agents, affiliates, heirs, successors-in-interest or assigns of any such excluded party.
e. "Class Member" means a Person who falls within the definition of the Class.
f. "Class Period" means the period between August 10, 2000 and March 15, 2001, inclusive.
g. "Defendants" means Frederick D. Lawrence, Donna S. Birks, Daniel L. Scharre, Peter J. Maloney and Adaptive.
h. "Effective Date" means the first date by which this Judgment becomes final by the expiration of the time to file a motion to alter or amend the Judgment under Fed.R.Civ.P. 59(e) has passed without any such motion having been filed; (ii) the expiration of the time in which to appeal the Judgment has passed without any appeal having been taken; and (iii) if such motion to alter or amend is filed or if an appeal is taken, then upon the determination of that motion or appeal in such a manner as to permit the consummation of the settlement substantially in accordance with the terms and conditions of this Stipulation.
i. "Escrow Agent" means the law firm of Abbey Gardy, LLP, or its successor(s).
j. "Individual Defendants" means Daniel Scharre, Frederick D. Lawrence, Donna S. Birks and Peter Maloney.
k. "Judgment" means this Final Order and Judgment.
l. "Parties" means Defendants and Plaintiff (on behalf of himself and the Class).
m. "Person" means an individual, corporation, partnership, limited partnership, association, joint stock company, estate, legal representative, trust, unincorporated association, government or any political subdivision or agency thereof, and any business or legal entity and their spouses, heirs, predecessors, successors, representatives, or assignees.
n. "Plaintiff" means Donald Angelini.
o. "Plaintiff's Counsel" means all counsel who have appeared for Plaintiff in the Litigation.
p. "Plaintiff's Settlement Counsel" means the law form of Abbey Gardy, LLP.
q. "Plan of Allocation" means the plan or formula of allocation of the Settlement Fund whereby the Settlement Fund shall be distributed to Authorized Claimants after payment of expenses of notice and administration of the settlement, Taxes and Tax Expenses and such attorneys' fees, costs, expenses and interest as may be awarded by the Court:
(1) To the extent there are sufficient funds in the Net Settlement Fund, each Authorized Claimant will receive an amount equal to the Authorized Claimant's claim, as defined below. If, however, the amount in the Net Settlement Fund is not sufficient to permit payment of the total claim of each Authorized Claimant, then each Authorized Claimant shall be paid the percentage of the Net Settlement Fund that each Authorized Claimant's claim bears to the total of the claims of all Authorized Claimants. Payment in this manner shall be deemed conclusive against all Authorized Claimants.
(2) A claim will be calculated as follows:
(a) For shares of Adaptive common stock that were purchased or acquired between August 10, 2000 and March 15, 2001, inclusive, and
(ii) sold from August 10, 2000 through March 15, 2001, inclusive, the claim per share is ten percent (10%) of the difference between the price paid for the shares of Adaptive common stock (excluding commissions, taxes, and fees) and the amount realized from the sale of any such shares (excluding commissions, taxes, and fees),
(iii) retained at the end of March 15, 2001, the claim per share is the difference between the price paid for the shares of Adaptive common stock (excluding commissions, taxes, and fees) and $0.8759 per share (the 90-day average closing price following the end of the Class Period).
(b) For Class Members who held shares at the beginning of the Class Period or made multiple purchases or sales during the Class Period, the first-in, first-out ("FIFO") method will be applied to such holdings, purchases and sales for purposes of calculating a claim. Under the FIFO method, sales of shares during the Class Period will be matched, in chronological order, first against shares held at the beginning of the Class Period. The remaining sales of shares during the Class Period will then be matched, in chronological order, against shares purchased during the Class Period.
(c) The date of purchase or sale is the trade date, and not the settlement date. The date of covering a "short sale" is deemed to be the date of purchase of Adaptive common stock. The date of a "short sale" is deemed to be the date of sale of Adaptive common stock. Exercises of option contracts will be considered purchases or sales of common stock. The option premiums should be incorporated into the purchase/sale price of the shares of common stock.
(d) A Class Member will be eligible to receive a distribution from the Net Settlement Fund only if a Class Member had a net loss, after all profits from transactions in Adaptive common stock during the Class Period are subtracted from all losses. However, the proceeds from sales of stock which have been matched against stock held at the beginning of the Class Period will not be used in the calculation of such loss. No payment will be made on any claims where the potential distribution amount is $5.00 or less, but the Authorized Claimant will nonetheless be bound by the Judgment.
r. "Related Parties" means each of Adaptive's past or present directors, officers, employees, partners, insurers, co-insurers, reinsurers, controlling shareholders, attorneys, accountants or auditors, personal or legal representatives, predecessors, successors, parents, subsidiaries, divisions, joint ventures, assigns, spouses, heirs, related or affiliated entities, any entity in which any of the Defendants have a controlling interest, any members of any Defendant's immediate family, or any trust of which any Individual Defendant is the settlor or which is for the benefit of any Individual Defendant's family.
s. "Released Claims" shall collectively mean all claims (including "Unknown Claims" as defined below), demands, rights, liabilities and causes of action of every nature and description whatsoever, known or unknown, whether or not concealed or hidden, asserted or that might have been asserted, including, without limitation, claims for negligence, gross negligence, breach of duty of care and/or breach of duty of loyalty, fraud, breach of fiduciary duty, or violations of any state or federal statutes, rules or regulations, by Plaintiff or any Class Member against Defendants and their Related Parties arising out of or based upon the purchase or acquisition of publicly traded securities of Adaptive and the facts, transactions, events, occurrences, acts, disclosure, statements, omissions or failures to act which were or could have been alleged in the Litigation.
t. "Released Persons" means each and all of the Defendants and all their Related Parties.
u. "Settlement Fund" means $8.2125 million in cash paid by check and deposited on July 14, 2003 into an interest-bearing escrow account established and controlled by the Escrow Agent, plus all interest earned thereon.
v. "Unknown Claims" means any Released Claims which Plaintiff or any Class Member does not know or suspect to exist in his, her or its favor at the time of the release of the Released Persons which, if known by him, her or it, might have affected his, her or its settlement with and release of the Released Persons, or might have affected his, her or its decision not to object to this settlement. With respect to any and all Released Claims, Plaintiff shall expressly and each of the Class Members shall be deemed to have, and by operation of this Final Judgment and Order shall have, expressly waived the provisions, rights and benefits of Cal. Civ. Code § 1542 and any and all provisions, rights and benefits conferred by any law of any state or territory of the United States, or principle of common law, which is similar, comparable or equivalent to Cal. Civ. Code § 1542.
2. This Court has jurisdiction over the subject matter of the Litigation and over all parties to the Litigation, including all Class Members.
3. Pursuant to Fed.R.Civ.P. 23, this Court hereby approves, in all respects, the settlement set forth in the Stipulation, which settlement includes an $8.21215 million settlement fund to be distributed to Authorized Claimants after payment of expenses of notice and administration of the settlement, taxes and tax expenses and attorneys' fees, costs, expenses and interest. The Court finds that the settlement set forth in the Stipulation is, in all respects, fair, just, reasonable and adequate to the Class.
4. Except as to any individual claim of those Persons (identified in Schedule 1, attached hereto) who have validly and timely requested exclusion from the Class, the Litigation and all claims contained therein, as well as all of the Released Claims, are dismissed with prejudice as to Plaintiff and the other Class Members, as against each and all of the Released Persons. The Parties are to bear their own costs, except as otherwise provided in the Stipulation.
5. The Court finds that the Stipulation and settlement are fair, just, reasonable and adequate as to each of the Parties, and that the Stipulation and settlement are hereby finally approved in all respects, and the Parties are hereby directed to perform its terms.
6. Upon the Effective Date hereof, Plaintiff shall, and each of the Class Members shall be deemed to have, and by operation of the Judgment shall have, fully, finally, and forever released, relinquished and discharged all Released Claims against the Released Persons, whether or not such Class Member executes and delivers the Proof of Claim and Release.
7. All Class Members are hereby forever barred and enjoined from prosecuting any of the Released Claims against any of the Released Persons.
8. Upon the Effective Date, each of the Defendants shall be deemed to have, and by operation of this Judgment shall have, fully, finally, and forever released, relinquished and discharged each and all of the Class Members and Plaintiff's Counsel from all claims (including Unknown Claims), arising out of, relating to, or in connection with the institution, prosecution, assertion, settlement or resolution of the Litigation or the Released Claims.
9. The Notice of Pendency and Proposed Settlement of Class Action given to the Class was the best notice practicable under the circumstances, including the individual notice to all Class Members who could be identified through reasonable effort. These notices fully satisfied the requirements of Fed.R.Civ.P. 23 and the requirements of due process. The Notices provided the best notice practicable under the circumstances of those proceedings and of the matters set forth therein, and advised the Class of the proposed settlement set forth in the Stipulation, the Plan of Allocation, Plaintiff's Counsel's application for attorney's fees and reimbursement of expenses, and advised the Class or their right to object thereto, and a full and fair opportunity was accorded to all Persons and entities who are Class Members to be heard with respect thereto.
10. The Court hereby finds and concludes that the Plan of Allocation set forth in the Notice of Pendency and Proposed Settlement of Class Action given to the Class provides a fair and reasonable basis upon which to allocate the proceeds of the Net Settlement Fund established by the Stipulation among Class Members, with due consideration having been given to administrative convenience and necessity. This Court hereby finds and concludes that the Plan of Allocation set forth in the Notice is, in all respects, fair, reasonable and adequate and the Court hereby approves the Plan of Allocation.
11. Payment pursuant to the Plan of Allocation set forth in the Notice shall be conclusive against all Authorized Claimants. No Person shall have any claim against Plaintiff's Settlement Counsel or any claims administrator or Defendants or other agent designated by Plaintiff's Settlement Counsel or Defendants or Defendants' Counsel based on distributions made substantially in accordance with the Stipulation and the settlement contained therein, the Plan of Allocation, or further orders of the Court. All Class Members who fail to complete and file a valid and timely Proof of Claim and Release shall be barred from participating in distributions from the Settlement Fund (unless otherwise ordered by the Court), but otherwise shall be bound by this Final Judgment and Order.
12. The Court hereby awards Plaintiffs' Settlement Counsel attorneys' fees of twenty-five percent (25%) of the Settlement Fund, plus reimbursement of litigation expenses in the amount of $324,177.00, together with the interest earned thereon at the same rate and for the same time as that earned on the Settlement Fund until paid. The Court finds that the "benchmark" percentage is appropriate and that the amount of fees awarded is fair and reasonable under the "percentage-of-recovery" method. The awarded attorneys' fees and expenses and interest earned thereon shall immediately be paid to Plaintiff's Counsel subject to the terms, conditions and obligations of the Stipulation.
13. The fees and expenses shall be allocated among Plaintiff's Counsel in a manner which, in Plaintiff's Settlement Counsel's good-faith judgment, reflects each such counsel's contribution to the institution, prosecution and resolution of the Litigation.
14. Neither the Stipulation nor the settlement contained therein, nor any act performed or document executed pursuant to or in furtherance of the Stipulation or the settlement: (a) is or may be deemed to be or may be used as an admission of, or evidence of, the validity of any Released Claim, or of any wrongdoing or liability of the Defendants or their respective Related Persons, or (b) is or may be deemed to be or may be used as an admission of, or evidence of, any fault or omission of any of the Defendants or their respective Related Persons in any civil, criminal or administrative proceeding in any court, administrative agency or other tribunal. Defendants and/or their respective Related persons may file the Stipulation and/or the Judgment from this action in any other action brought against them in order to support a defense or counterclaim based on principles of res judicata, collateral estoppel, release, good faith settlement, judgment bar or reduction or any theory of claim preclusion or issue preclusion or similar defense or counterclaim.
15. Without affecting the finality of this Judgment in any way, this Court hereby retains continuing jurisdiction over: (a) implementation of this settlement and any award or distribution of the Settlement Fund, including interest earned thereon; (b) disposition of the Settlement Fund; (c) hearing and determining applications for attorneys' fees, interest and expenses in the Litigation; and (d) all parties hereto for the purpose of construing, enforcing and administering the Stipulation.
16. The Court finds that during the course of the Litigation, the Parties and their respective counsel at all times complied with the requirements of Fed.R.Civ.P. 11.
17. In the event that the settlement does not become effective in accordance with the terms of the Stipulation, or the Effective Date does not occur, or in the event that the Settlement Fund, or any portion thereof, is returned to the Defendants or their Insurers, then this Judgment shall be rendered null and void to the extent provided by and in accordance with the Stipulation and shall be vacated and, in such event, all orders entered and releases delivered in connection herewith shall be null and void to the extent provided by and in accordance with the Stipulation.
IT IS SO ORDERED.
DECLARATION OF SERVICE BY FACSIMILE PURSUANT TO NORTHERN DISTRICT LOCAL RULE 23-2(c)(2)
I, the undersigned, declare:1. That declarant is and was, at all times herein mentioned, a citizen of the United States and employed in the City and County of San Francisco, over the age of 18 years, and not a party to or interest in the within action; that declarant's business address is 100 Pine Street, Suite 2600, San Francisco, California 94111.
2. That on August 5, 2004, declarant served by facsimile the [PROPOSED] FINAL JUDGMENT AND ORDER OF DISMISSAL WITH PREJUDICE to the parties listed on the attached Service List and this document was forwarded to the following designated Internet site at:
http://securities.lerachlaw.com/
3. That there is a regular communication by facsimile between the place of origin and the places so addressed.
I declare under penalty of perjury that the foregoing is true and correct. Executed this 5th day of August, 2004, at San Francisco, California.