Opinion
Civil Action No. 3:98-CV-1442-M
November 25, 2002
ORDER AND FINAL JUDGMENT
On this 25 day of November 2002, a hearing having been held before this Court to determine: (1) whether the terms and conditions of the Stipulation and Agreement of Settlement with All Defendants dated as of September 13, 2002 (the "Stipulation") are fair, reasonable and adequate for the settlement of all claims asserted by the Class against the Defendants in the complaint (the "Complaint") now pending in this Court under the above caption (the "Action"), including the release of the Defendants and the Released Parties (as defined below) and should be approved; (2) whether judgment should be entered dismissing the Complaint on the merits and with prejudice in favor of the Defendants and as against all persons or entities who are members of the Class herein who have not requested exclusion therefrom; (3) whether to approve the Plan of Allocation as a fair and reasonable method to allocate the settlement proceeds among the members of the Class; (4) whether and in what amount to award counsel for plaintiffs and the Class fees and reimbursement of expenses; and (5) whether and in what amount to award Lead Plaintiff Keith Dartley compensation for the time he expended and expenses he incurred in the litigation directly relating to the representation of the Class. The Court having considered all matters submitted to it at the hearing and otherwise; and it appearing that a notice of the hearing substantially in the form approved by the Court was mailed to all persons or entities (the "Class" or "Class Members") reasonably identifiable, who purchased common stock of ErgoBilt, Inc. ("ErgoBilt") during the period between February 3, 1997 and May 14, 1998, inclusive (the "Class Period"), except those persons or entities excluded from the definition of the Class, as shown by the records of ErgoBilt's transfer agent, at the respective addresses set forth in such records, and that a summary notice of the hearing substantially in the form approved by the Court was published in Investors Business Daily pursuant to the specifications of the Court; and the Court having considered and determined the fairness and reasonableness of the award of attorneys' fees and expenses requested, and all capitalized terms used herein having the meanings as set forth and defined in the Stipulation.
NOW, THEREFORE, IT IS HEREBY ORDERED THAT:
1. The Court has jurisdiction over the subject matter of the Litigation, plaintiffs, all Class Members and the Defendants. This Court hereby determines that due and proper notice of the proposed Settlement has been given to the members of the Class pursuant to Rule 23 of the Federal Rules of Civil Procedure, section 21D of the Securities Exchange Act of 1934, 15 U.S.C. § 78u-4(a)(7), due process, and any other applicable law.
2. The Court finds the prerequisites for a class action under Fed.R.Civ. p. 23(a) and (b)(3) have been satisfied in that: (a) the number of Class Members is so numerous that joinder of all members thereof is impracticable; (b) there are questions of law and fact common to the Class; (c) the claims of the Class Representatives are typical of the claims of the Class they seek to represent; (d) the Class Representatives have and will fairly and adequately represent the interests of the Class; (e) the questions of law and fact common to the members of the Class predominate over any questions affecting only individual members of the Class; and (f) a class action is superior to other available methods for the fair and efficient adjudication of the controversy.
3. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, this Court hereby finally certifies this action as a class action on behalf of all persons who, during the period between February 3, 1997 and May 14, 1998, inclusive, purchased common stock of ErgoBilt, excluding (i) Defendants and the officers and directors of ErgoBilt, members of their immediate families (parents, spouses, siblings, and children) and their legal representatives, heirs, successors or assigns and any entity in which defendants have or had a controlling interest; (ii) Generic Trading Associates, LLC; Sherleigh Associates Inc., Profit Sharing Plan; Sherleigh Associates Inc., Defined Benefit Pension Plan; Shirley Silver, Custodian for Romy Silver; Shirley Silver, Custodian for Leigh Silver; Shirley Silver, Trustee FBO Romy I. Silver; Shirley Silver, Trustee FBO Leigh N. Silver; CTSS, Inc.; Cheetah Systems, Inc. ("Cheetah"); and the following current or former owners of Cheetah shares or options: Paul Klein, Alan Anderson, David Blanchette, Gary Robson and William Robson, and (iii) any person who purchased ErgoBilt common stock in a privately negotiated transaction with any defendant named in this litigation or any of the Released Parties (as defined below). Also excluded from the Class are the persons and/or entities who properly requested exclusion from the Class as listed on Exhibit A annexed hereto.
4. Notice of the pendency of this Action as a class action and of the proposed Settlement was given to all Class Members who could be identified with reasonable effort. The form and method of notifying the Class of the pendency of the action as a class action and of the terms and conditions of the proposed Settlement met the requirements of Rule 23 of the Federal Rules of Civil Procedure, section 21D of the Securities Exchange Act of 1934, 15 U.S.C. § 78u-4(a)(7), due process, and any other applicable law, constituted the best notice practicable under the circumstances, and constituted due and sufficient notice to all persons and entities entitled thereto.
5. The Stipulation is approved as fair, reasonable and adequate, and the Class Members and the parties are directed to consummate the Stipulation in accordance with its terms and provisions.
6. The Complaint, which the Court finds was filed on a good faith basis in accordance with the Private Securities Litigation Reform Act and Rule 11 of the Federal Rules of Civil Procedure based upon all publicly available information, is hereby dismissed with prejudice and without costs, except as provided in the Stipulation, as against the Defendants.
7. Members of the Class and the successors and assigns of any of them, are hereby permanently barred and enjoined from instituting, commencing or prosecuting, either directly or in any other capacity, all known and unknown claims of the Plaintiffs and all Class Members against the Released Parties (as defined below), including (i) all federal statutory and common law claims, including but not limited to claims under the Securities Act of 1933 (the "1933 Act") and the Securities Exchange Act of 1934 (the "1934 Act") and (ii) all state statutory and common law claims, including but not limited to state securities law claims, claims under the law of fraud and deceit, false advertising and unfair competition claims, claims sounding in negligence, and claims that have been asserted in the Complaint or that could have been asserted in the Complaint and arise out of the subject matter of the Complaint (the "Settled Plaintiffs' Claims") against each of the Defendants, and each of their current and former officers, directors, employees and agents, accountants, financial advisors, insurers, reinsurers and attorneys and all professionals advising the Defendants in their capacities as such (the "Released Parties"). Notwithstanding the foregoing, Settled Plaintiffs' Claims does not include, and the settlement will not release or discharge any claims, rights, demands, causes of action, suits, matters, and issues arising out of the purchase of ErgoBilt products or the products of its subsidiaries or predecessors. The Settled Plaintiffs' Claims are hereby compromised, settled, released, discharged and dismissed as against the Released Parties on the merits and with prejudice by virtue of the proceedings herein and this Order and Final Judgment.
8. The Defendants and the successors and assigns of any of them, are hereby permanently barred and enjoined from instituting, commencing or prosecuting, either directly or in any other capacity, any and all claims, rights or causes of action or liabilities whatsoever, whether based on federal, state, local, statutory or common law or any other law, rule or regulation, including both known claims and Unknown Claims, that have been or could have been asserted in the Action or any forum by the Defendants or any of them or the successors and assigns of any of them against any of the Plaintiffs, Class Members or their attorneys, which arise out of or relate in any way to the institution or prosecution of the Action (the "Settled Defendants' Claims") against any of the plaintiffs, Class Members or their attorneys. The Settled Defendants' Claims are hereby compromised, settled, released, discharged and dismissed on the merits and with prejudice by virtue of the proceedings herein and this Order and Final Judgment.
9. The Court hereby enters a bar order, pursuant to Section 21D of the Securities Exchange Act of 1934, 15 U.S.C. § 78u-4 (g)(7), constituting the final discharge of all obligations to Plaintiffs of the settling defendants arising out of the Action (the "Contribution Bar Order"). The Contribution Bar Order shall bar all future claims for contribution arising out of the Action (and all actions and proceedings consolidated in this Action): (a) by any person against any settling defendant(s); (b) by any settling defendant(s) against any person, other than a person whose liability has been extinguished by Settlement.
10. Neither this Judgment, the Stipulation, nor any of its terms and provisions, nor any of the negotiations or proceedings connected with it, nor any of the documents or statements referred to therein shall be:
(a) offered or received against the Defendants or against plaintiffs or the Class as evidence of or construed as or deemed to be evidence of any presumption, concession, or admission by any of the Defendants or by any of the plaintiffs or the Class with respect to the truth of any fact alleged by plaintiffs or the validity of any claim that had been or could have been asserted in the Action or in any litigation, or the deficiency of any defense that has been or could have been asserted in the Action or in any litigation, or of any liability, negligence, fault, or wrongdoing of the Defendants;
(b) offered or received against the Defendants as evidence of a presumption, concession or admission of any fault, misrepresentation or omission with respect to any statement or written document approved or made by any Defendant, or against the plaintiffs and the Class as evidence of any infirmity in the claims of plaintiffs and the Class;
(c) offered or received against the Defendants or against the plaintiffs or the Class as evidence of a presumption, concession or admission with respect to any liability, negligence, fault or wrongdoing, or in any way referred to for any other reason as against any of the parties to this Stipulation, in any other civil, criminal or administrative action or proceeding, other than such proceedings as may be necessary to effectuate the provisions of this Stipulation; provided, however, that if this Stipulation is approved by the Court, the Defendants may refer to it to effectuate the liability protection granted them hereunder;
(d) construed against the Defendants or the plaintiffs and the Class as an admission or concession that the consideration to be given hereunder represents the amount which could be or would have been recovered after trial; or
(e) construed as or received in evidence as an admission, concession or presumption against plaintiffs or the Class or any of them that any of their claims are without merit or that damages recoverable under the Complaint would not have exceeded the Settlement Fund.
11. The Plan of Allocation is approved as fair and reasonable, and Plaintiffs' Counsel and the Claims Administrator are directed to administer the Stipulation in accordance with its terms and provisions.
12. The Court finds that all parties and their counsel have complied with each requirement of Rule ii of the Federal Rules of Civil Procedure as to all proceedings herein.
13. Plaintiffs' Counsel are hereby awarded the sum of $1,073.333 in fees, which sum the Court finds to be fair and reasonable, and $92,134 in reimbursement of expenses, which shall be paid to Plaintiffs' Counsel from the Settlement Fund with interest from the, date such Settlement Fund was funded to the date of payment at the same net rate that the Settlement Fund earns.
14. Lead Plaintiff Keith Dartley is hereby awarded the sum of $2,200 which sum the Court finds to be fair and reasonable, as compensation for the time he expended and expenses he incurred in the litigation directly relating to the representation of the Class.
15. Exclusive jurisdiction is hereby retained over the parties and the Class Members for all matters relating to this litigation, including the administration, interpretation, effectuation or enforcement of the Stipulation and this Order and Final Judgment, and including any application for fees and expenses incurred in connection with administering and distributing the settlement proceeds to the members of the Class.
16. Without further order of the Court, the parties may agree to reasonable extensions of time to carry out any of the provisions of the Stipulation.
17. There is no just reason for delay in the entry of this Order and Final Judgment and immediate entry by the Clerk of the Court is expressly directed pursuant to Rule 54(b) of the Federal Rules of Civil Procedure.