Porter v. Costolo et al

Filing 31

STIPULATION AND ORDER re 30 STIPULATION WITH PROPOSED ORDER Staying the Action filed by Francis Fleming, Ernesto Espinoza, Jim Porter. Signed by Judge Jon S. Tigar on April 13, 2017. (wsn, COURT STAFF) (Filed on 4/13/2017)

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JOHNSON & WEAVER, LLP
FRANK J. JOHNSON (174882)
[e-mail]
PHONG L. TRAN (204961)
[e-mail]
600 West Broadway, Suite 1540
San Diego, CA 92101
Telephone: [phone]
Facsimile: [phone]

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-and-

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ROBBINS ARROYO LLP
BRIAN J. ROBBINS (190264)
[e-mail]
FELIPE J. ARROYO (163803)
[e-mail]
SHANE P. SANDERS (237146)
[e-mail]
600 B Street, Suite 1900
San Diego, CA 92101
Telephone: [phone]
Facsimile: [phone]

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Co-Lead Counsel for Plaintiffs

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[Additional counsel appear on signature page]

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UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION
IN RE TWITTER, INC. SHAREHOLDER
DERIVATIVE LITIGATION,

Lead Case No.: 3:16-cv-06136-JST
(Consolidated with Nos. 3:16-cv-06457-JST
and 4:16-cv-06492-JST)

This Document Relates To:
ALL ACTIONS.

STIPULATION AND [PROPOSED]
ORDER STAYING THE ACTION

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(Derivative Action)

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Judge: Honorable Jon S. Tigar
Courtroom: 9
Date Action Filed: October 24, 2016

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STIPULATION AND [PROPOSED] ORDER STAYING
THE ACTION

Lead Case No. 3:16-cv-06136-JST

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Plaintiffs Jim Porter, Ernesto Espinoza, and Francis Fleming (“Plaintiffs”) and

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individual defendants Richard Costolo, Anthony Noto, Jack Dorsey, Peter Fenton, David

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Rosenblatt, Marjorie Scardino, Evan Williams, Peter Chernin, Peter Currie, and nominal

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defendant Twitter, Inc. (“Twitter” and, together with the individual defendants, the

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“Defendants”), through their respective counsel, hereby stipulate as follows:

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WHEREAS, between October 24, 2016, and November 8, 2016, Plaintiffs filed

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shareholder derivative actions pleading claims for, among other things, violations of federal

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securities law, breaches of fiduciary duties, waste of corporate assets, and unjust enrichment

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against certain current and/or formers directors and officers of Twitter, and this Court

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consolidated those actions (the “Consolidated Derivative Action” or “Action”) on January 20,

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2017 (Doc. No. 21) (the “January 2017 Order”);

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WHEREAS, pursuant to the January 2017 Order, Plaintiffs and Defendants (the

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“Parties”) have met and conferred to discuss further proceedings in the Consolidated

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Derivative Action and hereby submit this stipulation and proposed order;

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WHEREAS, in addition to the Consolidated Derivative Action, there is a related

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federal securities class action pending before this Court entitled Shenwick v. Twitter, Inc.,

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No. 3:16-cv-05314-JST (the “Securities Action”);

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WHEREAS, the defendants in the Securities Action plan to file a motion to dismiss the

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consolidated amended complaint filed in that matter, and a hearing on defendants’ anticipated

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motion to dismiss has been scheduled for September 14, 2017;

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WHEREAS, while Plaintiffs believe the allegations set forth in the Consolidated

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Derivative Action have merit independent of, and are not dependent on, the facts alleged in the

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Securities Action, the Parties agree that motion work in the Securities Action may help inform

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the manner in which the Consolidated Derivative Action proceeds and may affect or

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substantially streamline the resolution of the Action;

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WHEREAS, due to the unique facts and circumstances presented by this case, and the

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Parties’ interest in preserving the Company’s resources and avoiding potentially unnecessary

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STIPULATION AND [PROPOSED] ORDER STAYING
THE ACTION

Lead Case No. 3:16-cv-06136-JST

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costs and litigation during the pendency of the Securities Action, the Parties agree that the

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interests of justice and efficient and effective case management would best be served by

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temporarily deferring prosecution of the Consolidated Derivative Action until the resolution of

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the anticipated motion to dismiss in the Securities Action; and

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WHEREAS, the Parties agree that, at any time during which the prosecution of this

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Consolidated Derivative Action is stayed pursuant to this Order, any Party may file a motion

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with the Court seeking to modify the terms of the Order, which motion may be opposed by any

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other Party.

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NOW THEREFORE, IT IS HEREBY STIPULATED AND AGREED, by and between
the Parties, through their undersigned counsel, subject to approval of the Court, as follows:

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1.

Subject to Paragraphs 2-8 below, all proceedings in the Consolidated Derivative

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Action shall be stayed until a ruling on the defendants’ anticipated motion to dismiss in the

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Securities Action.

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2.

Within thirty (30) days after the ruling on the motion to dismiss in the

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Securities Action, the Parties in this Consolidated Derivative Action will meet and confer in

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good faith to determine a schedule for further proceedings in the Action, and will submit a

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proposed scheduling stipulation for this Court’s review and approval.

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3.

If the parties in the Securities Action decide to engage in mediation, Defendants

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agree to provide Plaintiffs in the Consolidated Derivative Action with reasonable advance

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notice of the mediation.

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4.

Notwithstanding the stay of the Consolidated Derivative Action, Plaintiffs shall

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be permitted to file a consolidated complaint, as well as any subsequent amended complaints,

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during the pendency of the stay. Defendants shall be under no obligation to move to dismiss

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or otherwise respond to any such complaint while the Consolidated Derivative Action is

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stayed.

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5.

In entering this Stipulation and agreement, Defendants expressly reserve all of

their defenses and objections that they may have in the Consolidated Derivative Action,

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STIPULATION AND [PROPOSED] ORDER STAYING
THE ACTION

Lead Case No. 3:16-cv-06136-JST

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including defenses and objections to jurisdiction and venue, and the stay of the Action shall

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not be, and shall not be deemed, a waiver of any of Defendants’ defenses or objections.

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The Parties agree that any challenges to Plaintiffs’ allegations that demand on

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the Twitter Board of Directors (the “Board”) is or was futile will be determined based on the

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composition of the Board as of the time the first derivative complaint was filed.

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7.

This Stipulation shall not preclude or prevent the Parties from stipulating to, or

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filing a motion seeking, a court order lifting, modifying, or extending the terms of this

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Stipulation, and any Party’s right to oppose such motion.

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8.

By entering into this Stipulation, the Parties do not waive any rights not

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specifically addressed herein, including the right to pursue formal discovery and/or file any

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motion any Party deems appropriate once this case is no longer stayed.

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Dated: April 12, 2017

ROBBINS ARROYO LLP
BRIAN J. ROBBINS
FELIPE J. ARROYO
SHANE P. SANDERS

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s/ Shane P. Sanders
SHANE P. SANDERS

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600 B Street, Suite 1900
San Diego, CA 92101
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
[e-mail]
[e-mail]

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Co-Lead Counsel for Plaintiffs

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Dated: April 12, 2017

JOHNSON & WEAVER, LLP
FRANK J. JOHNSON
PHONG L. TRAN

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s/ Frank J. Johnson
FRANK J. JOHNSON

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600 West Broadway, Suite 1540
San Diego, CA 92101
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
[e-mail]

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Co-Lead Counsel for Plaintiffs
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STIPULATION AND [PROPOSED] ORDER STAYING
THE ACTION

Lead Case No. 3:16-cv-06136-JST

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Dated: April 12, 2017

SIMPSON THACHER & BARTLETT LLP
JAMES G. KREISSMAN
SIMONA G. STRAUSS

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s/ Simona G. Strauss
SIMONA G. STRAUSS

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2475 Hanover Street
Palo Alto, CA 94304
Telephone: [phone]
Facsimile: [phone]
[e-mail]
[e-mail]

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SIMPSON THACHER & BARTLETT LLP
Jonathan K. Youngwood (pro hac vice)
425 Lexington Ave.
New York, NY 10017-3954
Telephone: [phone]
Facsimile: [phone]
[e-mail]

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Counsel for Defendants Richard Costolo,
Anthony Noto, Jack Dorsey, Peter Fenton,
David Rosenblatt, Marjorie Scardino, Evan
Williams, Peter Chernin, Peter Currie, and
Nominal Defendant Twitter, Inc.

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SIGNATURE ATTESTATION

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I am the ECF user whose identification and password are being used to file the

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foregoing Joint Case Management Statement. In compliance with Local Rule 5-1(i)(3), I

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hereby attest that concurrence in the filing of this document has been obtained.

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Dated: April 12, 2017
s/ Frank J. Johnson
FRANK J. JOHNSON

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ORDER
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PURSUANT TO STIPULATION, IT IS SO ORDERED.
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April 13, 2017
Dated: _______________________
HONORABLE JON S. TIGAR
UNITED STATES DISTRICT JUDGE

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STIPULATION AND [PROPOSED] ORDER STAYING
THE ACTION

Lead Case No. 3:16-cv-06136-JST