Angela Kleinfeldt v. Chris T. Sharng et al

Filing 45

FINAL JUDGMENT by Judge Terry J. Hatter, Jr. See order for details. (MD JS-6, Case Terminated). (shb)

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FARU~I & FARUQI,LLP
Benjamin Heikali SBN 307466
10866 Wilshire Boulevard, Suite 1470
Los Angeles, CA 90024
Telephone: [phone]
Facsimile:(~24)256-2885
Email: [e-mail]

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Counselfor Plaintiff

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iJNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

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~viv~~L~v ~,r,iNrr,Llii, lierivative~y on
Behalf of Nominal Defendant, NATURAL
HEALTH TRENDS CORP.,

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Case No. 2:16-cv-01547 `~S ~ ~ ~~m~~
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Plaintiff,

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vs.

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CHRIS T. SHARNG,GEORGE K.
BROADY,KIN Y. CHUNG,RANDALL A.
MASON,CHRISTOPHER R. O'BRIEN,
and TIMOTHY S. DAVIDSON,
Defendants,
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[
P
]FINAL
JUDGMENT

NATURAL HEALTH TRENDS CORP.
Nominal Defendant.

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This matter came before the Court for a hearing pursuant to the Order of thi

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Court entered on April 4, 2018 ("Preliminary Approval Order"), on the application o

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the Parties for approval of the Settlement set forth in the Stipulation of Settlement,

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executed as of March 9, 2018 (the "Stipulation"). All capitalized terms used

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have the meanings set forth and defined in the Stipulation.

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The Court has received a declaration attesting to filing of the Notice with the

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United States Securities and Exchange Commission, publishing of the Notice via

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press release, and posting of the Notice and the Stipulation on NHTC's corporat

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website in accordance with the Preliminary Approval Order. Due and adequate notic

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having been given to NHTC Shareholders as required by the Preliminary Approve

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Order, and the Court having considered all papers filed and proceedings in thi

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Kleinfeldt Action and otherwise being fully informed of the matters herein, and goo

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cause appearing therefore, IT IS HEREBY ORDERED, ADJUDGED, AlVI

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This Court has jurisdiction over the subject matter of the Kleinfeldt

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Action, including the terms and conditions of the Stipulation and all exhibits thereto,

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and over the Parties to the Stipulation.

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Based on evidence submitted by NHTC's counsel, the Court finds tha

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the Notice was disseminated according to this Court's Preliminary Approval Order.

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This Court further finds that the form and content of the Notice, as previously

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preliminarily approved by the Court, complied with the requirements of Federal Rule

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of Civil Procedure 23.1, satisfied the requirements of due process, and constituted due

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and sufficient notice of the matters set forth therein.

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A full opportunity has been offered to NHTC Shareholders to object

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the proposed Settlement and to participate in the hearing thereon, and as such,

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current and former NHTC Shareholders are bound by this Order.

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The Court finds that the Settlement is fair, reasonable, adequate, and i

the best interests of NHTC and NHTC Shareholders.

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5.

The Court finds, for settlement purposes only, that: (1) the Klein

Action was properly brought as a shareholder derivative suit pursuant to Federal

3 ~ ~ of Civil Procedure 23.1; and (2) Plaintiff Angela Kleinfeldt has
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represented the interests of NHTC Shareholders in enforcing the rights of NHTC.
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The Stipulation and the terms of the proposed Settlement set forth therei

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are, in all respects, hereby finally approved. The Parties to the Stipulation are di

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to consummate the Settlement in accordance with the terms and provisions of the

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Stipulation.

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This Kleinfeldt Action and all claims contained therein, as well as all

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Released Claims, are hereby dismissed with prejudice, released, and discharged it

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their entirety, on the merits, as against all Released Persons. Each Party shall bear i

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own fees and costs, except as set forth herein.

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Upon the Effective Date, Plaintiffs, NHTC, and all current and

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NHTC Shareholders, on behalf of themselves, and each of their respective personal

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representatives, Immediate Family members, trustees, heirs, executors, administrators,

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parent entities, associates, affiliates, predecessors, successors, and assigns, and any

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other Person claiming (now or in the future) to be acting for, through, or on behalf of

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any of them, shall be deemed to have, and by operation of this Judgment shall have,

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fully, finally, and forever released, relinquished, settled, and discharged all Released

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Claims against the Released Persons and shall be permanently barred and enjoined

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f
rom instituting, commencing, participating in, continuing, maintaining, asserting, or

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prosecuting any Released Claims against any of the Released Persons, or assisting any

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Person in instituting, commencing, participating in, continuing, maintaining, asserting,

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or prosecuting any Released Claims against any of the Released Persons. Nothing

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herein shall in any way impair or restrict the rights of any of the Parties to enforce the

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terms of the Stipulation.

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Upon the Effective Date, the Released Persons shall be deemed to have

and by operation of this Judgment shall have, fully, finally, and forever released,

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relinquished, and discharged Plaintiffs and Plaintiffs' Counsel from all claims arisi

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out of, relating to, or in connection with the institution, prosecution, assertion.

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settlement, or resolution of the Released Claims, including all claims that each

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Released Person does not know or suspect to exist in his, her, or its favor at the time

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of the release of Plaintiffs and Plaintiffs' Counsel, which, if known by him, her, or it.

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might have affected his, her, or its settlement with and release of Plaintiffs and

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Plaintiffs' Counsel, or might have affected his, her, or its decision not to object to the

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Settlement. Nothing herein shall in any way impair or restrict the rights of any of the

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Parties to enforce the terms of this Stipulation.

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10.

Pursuant to the Stipulation, within three (3) business days after the

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Judgment in this Kleinfeldt Action becomes Final, Plaintiff Zhou shall file the

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necessary documents in the Zhou Action to voluntarily dismiss that action wi

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prejudice, in accordance with the State Court's local rules.

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11.

Plaintiffs' Counsel in the Actions are hereby awarded attorneys' fees an

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a reimbursement of expenses collectively totaling $250,000.00 ("Fee and Expens

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Award"). This Court finds that this amount is fair and reasonable under the facts an

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circumstances of this case. Payment of the Fee and Expense Award shall be made in

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accordance with the provisions of the Stipulation.

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Counsel shall have no responsibility for the allocation or distribution of the Fee

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Expense Award amongst Plaintiffs' Counsel in this Kleinfeldt Action and the

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Action.

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12.

Defendants and Defendants'

Plaintiffs are each awarded Service Awards in the amount of $1,000.00,

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which shall be funded from the Fee and Expense Award. Defendants and Defendants'

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Counsel shall have no responsibility for the allocation or distribution of the Service

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Awards.

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13.

This Judgment, the Stipulation and all of its provisions, and any

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negotiations, proceedings, or agreements relating to the Stipulation and the

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Settlement, and any matters arising in connection with such negotiations, proceedings

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or agreements, and any acts performed or documents executed pursuant to or i

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furtherance of this Judgment or the Stipulation:

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a
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shall not be offered or received against any of the Rel

Persons as evidence of a presumption, concession, or admission of any kind;
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shall not be offered or received against any of the Rel

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Persons as evidence of an admission by any of those Released Persons with respect

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the truth of any fact alleged in any of the Actions or the validity of any Releas

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Claims, or the deficiency of any defense that has been or could have been asserted,

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of any liability, negligence, fault, or wrongdoing of the Released Persons;

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c
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shall not be offered or received against the Released Persons

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evidence of any fault, misrepresentation, omission, or other actionable conduct wi

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respect to any statement or written document approved or made by any of the

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Released Persons;

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d
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shall not be offered or received against the Released Persons as

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evidence of any liability, negligence, fault, or wrongdoing, or in any way referred

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for any other reason as evidence against any of the Released Persons, in any

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civil, criminal, or administrative action or proceeding, other than such proceedings

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may be necessary to effectuate the provisions of this Stipulation; provided, however

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that if this Stipulation is approved by the Court, the Released Persons may refer to i~

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to effectuate the release of Released Claims and other liability protections grantee

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them hereunder;

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e
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shall not be construed against any of the Released Persons as

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admission, concession, or presumption that the consideration to be given

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represents the amount that could be or would have been recovered after trial;

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shall not be construed as or received in evidence as an admission,

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concession, or presumption against Plaintiffs that any of their claims are wi

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merit, or that any defenses asserted by the Defendants have any merit, or that damages

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recoverable in the Actions would not have exceeded the settlement amount; and

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g)

shall not, in the event of a Termination, be used by any Party

any purpose in any trial in any of the Actions
Notwithstanding anything else in this Judgement to the contrary, any Party

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f or introduce the Stipulation and/or this Judgment in any action or proceeding that
ile

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may be brought to enforce the terms of the Stipulation and/or the Judgment(including

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in support of a defense or counterclaim based on principles of res judicata, collateral

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estoppel, release, good faith settlement, judgment bar, or reduction, or any other

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theory of claim preclusion or issue preclusion or similar defense or counterclaim), or

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any action or proceeding related to rights or claims of Defendants relating to

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indemnification and/or advancement in connection with the Actions.
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The Court finds that during the course of the Kleinfeldt Action,

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Parties and their counsel at all times complied with the requirements of Federal Rul

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of Civil Procedure 11 and all other similar rules of professional conduct.

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15.

Without in any way affecting the finality of this Judgment, this

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shall retain jurisdiction over the Parties to the Stipulation and the Released Parti

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with respect to all matters related to the Kleinfeldt Action and over all proceedi

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related to the implementation and enforcement ofthe terms ofthe Stipulation.

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16.

The Settlement shall be a final and complete resolution of all disputes

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among the Parties. No party to the Stipulation may assert in any forum that the

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Actions were brought, commenced, or prosecuted by the Plaintiffs or Plaintiffs'

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Counsel in bad faith or that the Actions were not filed or raised in good faith or were

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not settled voluntarily after negotiating at arm's length and in good faith after

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consultation with competent legal counsel.

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17.

Nothing in this Judgment constitutes or reflects a waiver, release,

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discharge of any rights or claims of Defendants against their insurers, or their insurers'

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subsidiaries, predecessors, successors, assigns, affiliates, or representatives.

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18.

The Parties are hereby authorized, without further approval of the C

to unanimously agree to and adopt in writing such amendments, modifications,

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expansions of the Stipulation and all e~ibits attached thereto, provided that such

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amendments, modifications, and expansions of the Stipulation are done in accordance

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with the terms of Paragraph 27 of the Stipulation, are not materially inconsistent with

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this Judgment and do not materially limit the rights of NHTC Shareholders or the

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Released Persons under the Stipulation.

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19.

In the event that the Settlement does not become effective in accordance

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with the terms of the Stipulation, then this Judgment shall be rendered null and void to

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the extent provided by and in accordance with the Stipulation and shall be vacated,

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and in such event, all orders entered and releases delivered in connection herewith

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shall be null and void to the extent provided by and in accordance with the Stipulati

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and the provisions ofParagraph 21 ofthe Stipulation shall apply.

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20.

The provisions of this Judgment constitute a full and compl

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adjudication of the matters considered and adjudged herein, and the Court determi

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that there is no just reason for delay in the entry of judgment. The Clerk is hereby

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directed to immediately enter this Judgment.

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SO ORDERED this ~°~
day of

~,2018.

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The
o le Terry J. tter, Jr.
Uni d States District Court Judge