Luna et al v. Marvell Technology Group, Ltd. et al

Filing 53

ORDER by Judge Ronald M. Whyte granting 33 , 45 Motion to Appoint Lead Plaintiff and Lead Counsel (rmwlc1, COURT STAFF) (Filed on 2/8/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
Northern District of California

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DANIEL LUNA,

Case No. 15-cv-05447-RMW

Plaintiff,
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v.

ORDER GRANTING MOTION FOR
APPOINTMENT AS LEAD PLAINTIFF
AND APPROVAL OF SELECTION OF
COUNSEL

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MARVELL TECHNOLOGY GROUP LTD,
et al.,

Re: Dkt. No. 33, 45

Defendants.

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In this securities action, plaintiff Plumbers and Pipefitters National Pension Fund has

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moved for appointment to serve as lead plaintiff and for approval of its selection of Robbins

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Geller Rudman & Dowd LLP as lead counsel. Dkt. Nos. 33, 45. Plumbers & Pipefitters’ motion is

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unopposed. Pursuant to Civil Local Rule 7-1(b), the court finds the motion appropriate for

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determination without oral argument. The court grants Plumbers & Pipefitters’ motion.

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I.

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BACKGROUND
On September 11, 2015, plaintiff Daniel Luna filed suit in the Southern District of New

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York, alleging that defendants Marvell Technology Group, Ltd., Sehat Sutardja, Michael Sashkin,

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and Sukhi Nagesh violated federal securities laws. Dkt. No. 1. This case was consolidated with

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two similar actions on November 3, 2015. Dkt. No. 8. On November 10, 2015, Plumbers &
Pipefitters filed a motion for appointment as lead plaintiff and for approval of its selection of lead
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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC

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counsel. Dkt. Nos. 17. Four other parties also moved for appointment as plaintiff. Dkt. Nos. 11,

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The case was transferred from the Southern District of New York to the Northern District

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of California on November 27, 2015. Dkt. No. 30. On December 4, 2015, Plumbers & Pipefitters

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re-noticed its motion for appointment as lead plaintiff in the Northern District of California. Dkt.

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No. 33. Two motions for appointment as lead plaintiff were withdrawn. Dkt. Nos. 29, 37. The

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other two motions were not re-noticed.
This case was related to Saratoga Advantage Trust Technology & Communications

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United States District Court
Northern District of California

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Portfolio v. Marvell Technology Group, Ltd. et al, No. 5:15-cv-04881-RMW and transferred to
this court on December 22, 2015. Dkt. No. 41. On December 28, 2015, Plumbers & Pipefitters renoticed its motion for hearing on January 29, 2016. Dkt. No. 45. There are no competing motions
for appointment as lead counsel pending, and Plumbers & Pipefitters’ motion is unopposed.
II.

ANALYSIS
Under the Private Securities Litigation Reform Act, the court must appoint “the member or

members of the purported plaintiff class that the court determines to be most capable of adequately
representing the interests of class members” as lead plaintiff. 15 U.S.C. § 78u-4(a)(3)(B)(i). “The

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Reform Act provides a simple three-step process for identifying the lead plaintiff pursuant to these
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criteria.” In re Cavanaugh, 306 F.3d 726, 729 (9th Cir. 2002)
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First, the pendency of the action, the claims made, and the purported class period must be
publicized in a “widely circulated national business-oriented publication or wire service” within
20 days of the filing of the complaint. 15 U.S.C. § 78u-4(a)(3)(A)(i)(I). This notice must advise

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members of the purported class that “any member of the purported class may move the court to

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serve as lead plaintiff of the purported class” within 60 days of the notice. 15 U.S.C. § 78u-

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4(a)(3)(A)(i)(II).
Second, the court must identify the presumptive lead plaintiff. To do so, the court “must

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compare the financial stakes of the various plaintiffs and determine which one has the most to gain

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from the lawsuit.” Cavanaugh, 306 F.3d at 730. The court must then determine whether that

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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC

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individual, “based on the information he has provided in his pleadings and declarations,” satisfies

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the requirements of Rule 23(a), “in particular those of ‘typicality’ and ‘adequacy.’” Id. If the

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plaintiff with the largest financial interest satisfies these requirements, he becomes the

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“presumptively most adequate plaintiff.” Id.; see also 15 U.S.C. § 78u-4(a)(3)(B)(iii)(I).
Third, other plaintiffs must have “an opportunity to rebut the presumptive lead plaintiff’s

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showing that it satisfies Rule 23’s typicality and adequacy requirements.” Cavanaugh, 306 F.3d at

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730.

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United States District Court
Northern District of California

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A.

Procedural Requirements

On September 11, 2015, the same day the complaint was filed, a notice of the pendency of
this action was published on Business Wire. See Dkt. No. 45-2 at 5-6. This noticed identified the
claims asserted in the action, as well as the purported class period. See 15 U.S.C. § 78u–
4(a)(3)(A). It also advised putative class members that they had 60 days from the date of the notice
to file a motion to seek appointment as lead plaintiff. See id. Plumbers & Pipefitters filed is motion
within 60 days of the publication of the notice. Dkt. No. 17. Therefore, the statutory procedural
requirements are met.
B.

Presumptive Lead Plaintiff
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Financial Interest

The Court must next determine whether Plumbers & Pipefitters qualifies as the most
adequate plaintiff. To make this determination, the Court must first consider Plumbers &
Pipefitters’ financial interest in the relief sought. See Cavanaugh, 306 F.3d at 730. Plumbers &
Pipefitters has submitted a chart that summarizes its transactions involving Marvell shares. See
Dkt. No. 45-2 at 2. This chart shows an estimated total loss of $1,167,268.83. Dkt. No. 45-2 at 8.
Because Plumbers & Pipefitters was the only movant for appointment as lead counsel and
the motion is unopposed, Plumbers & Pipefitters is necessarily the prospective lead plaintiff with
the greatest financial interest in the litigation. See City of Dearborn Heights Act 345 Police & Fire
Ret. Sys. v. Align Tech., Inc., No. 12-CV-06039-LHK, 2013 WL 2368059, at *3 (N.D. Cal. May
29, 2013) (quoting Bassin v. Decode Genetics, Inc., 230 F.R.D. 313, 316 (S.D.N.Y.2005)
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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC

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(“Without access to financial information from other parties, the Court is constrained to conclude

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that the [proposed plaintiff’s] alleged loss best qualifies it to serve as lead plaintiff.”)).

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2.

Rule 23 Requirements

Having determined that Plumbers & Pipefitters is the prospective lead plaintiff, the court

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must next consider whether Plumbers & Pipefitters satisfies the typicality and adequacy

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requirements of Rule 23(a).1 In making this determination, the court “must rely on the

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presumptive lead plaintiff’s complaint and sworn certification; there is no adversary process to test

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the substance of those claims.” Cavanaugh, 306 F.3d at 730. As such, Plumbers & Pipefitters need

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only make a prima facie showing that it satisfies the Rule 23 requirements of typicality and

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adequacy. See id. at 731.
In determining whether typicality is satisfied, a Court inquires “whether other members

United States District Court
Northern District of California

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have the same or similar injury, whether the action is based on conduct which is not unique to the

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named plaintiffs, and whether other class members have been injured by the same course of

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conduct.” Hanon v. Dataproducts Corp., 976 F.2d 497, 508 (9th Cir. 1992) (quotation omitted).

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Plumbers & Pipefitters alleges that it has been injured by the same course of conduct in that it

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purchased Marvell stock during the relevant time period, was adversely affect by defendants’ false

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and misleading statements, and suffered damages as a result. See Dkt. No. 45-2 at 10-12; Dkt. No.

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45-1 at 6.
The test for adequacy asks whether the class representative and his counsel “have any

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conflicts of interest with other class members” and whether the class representative and his

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counsel will “prosecute the action vigorously on behalf of the class.” Staton v. Boeing Co., 327

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F.3d 938, 957 (9th Cir. 2003). There is no indication of conflicts between Plumbers & Pipefitters

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Federal Rule of Civil Procedure 23(a) sets forth four requirements for class certification: (1)
numerosity, (2) commonality, (3) typicality, and (4) adequacy. “At the appointment of lead
plaintiff stage, courts need only consider typicality and adequacy, as the failure to satisfy
numerosity or commonality would preclude certifying a class action at all.” Welgus v. Trinet Grp.,
Inc., No. 15-CV-03625-BLF, 2015 WL 7770222, at *2 n.1 (N.D. Cal. Dec. 3, 2015) (citing
Cavanaugh, 306 F.3d at 730 n.5.).

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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC

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and other class members, nor is there any indication that will not prosecute the action vigorously

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on behalf of the class. Moreover, Plumbers & Pipefitters’ “diligence in seeking appointment as

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lead plaintiff” suggests that it will prosecute this action vigorously.” Welgus, 2015 WL 7770222,

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at *3 (N.D. Cal. Dec. 3, 2015).

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C.

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Because it has the greatest financial stake and satisfies the Rule 23(a) requirements,

Opportunity for Rebuttal

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Plumbers & Pipefitters is presumptively the most adequate plaintiff to represent the class. This

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presumption may be rebutted only upon proof by a member of the purported plaintiff class that

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Plumbers & Pipefitters either (1) “will not fairly and adequately protect the interests of the class,”
or (2) “is subject to unique defenses that render [it] incapable of adequately representing the

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United States District Court
Northern District of California

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class.” 15 U.S.C. § 78u–4(a)(3)(3)(B)(iii)(II). No purported class member has come forward with

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such rebuttal evidence.

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D.

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Under the PLSRA, the lead plaintiff has the right, subject to court approval, to “select and

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retain counsel to represent the class.” 15 U.S.C. § 78u–4(a)(3)(B)(v). “[T]he district court should

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not reject a lead plaintiff’s proposed counsel merely because it would have chosen differently.”

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Cohen v. U.S. Dist. Court, 586 F.3d 703, 711 (9th Cir. 2009) (citation omitted); see also

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Cavanaugh, 306 F.3d at 734 n.14 (confirming that choice of counsel belongs to lead plaintiff).

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“[I]f the lead plaintiff has made a reasonable choice of counsel, the district court should generally

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defer to that choice.” Cohen, 586 F.3d at 712 (citations omitted).

Lead Counsel

Plumbers & Pipefitters has chosen the law firm of Robbins Geller Rudman & Dowd LLP.

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No parties have objected to Robbins Geller. The Court has reviewed the firm’s resume. See Dkt.

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Nos. 45-3:6. The court is satisfied that the lead plaintiff has made a reasonable choice of counsel.

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III.

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CONCLUSION
For these reasons, the court appoints Plumbers & Pipefitters as lead plaintiff and approves

the Plumbers & Pipefitters’ selection of Robbins Geller Rudman & Dowd LLP as lead counsel.

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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC

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IT IS SO ORDERED.
Dated: February 8, 2016
______________________________________
Ronald M. Whyte
United States District Judge

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United States District Court
Northern District of California

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15-cv-05447-RMW
ORDER GRANTING MOTION FOR APPOINTMENT AS LEAD PLAINTIFF AND APPROVAL OF SELECTION
OF COUNSEL
FC