Perez v. Target Corporation et al
ORDER granting in part and denying in part 60 Unopposed Motion to Substitute Lead Plaintiff and Lead Counsel and for Extension of Time. Signed by Magistrate Judge Tony N. Leung on 11/13/2023. (Written Opinion) (EB)
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
Rafael E. Perez,
individually and on behalf of all others
Case No. 23-cv-769 (PJS/TNL)
Brian C. Cornell,
Michael J. Fiddelke, and
A. Christina Hennington,
This matter comes before the Court on Lead Plaintiff Gary Schaedel and Movant
the Terry and Diane Van Der Tuuk Living Trust (the “Trust”)’s Unopposed Motion to
Substitute Lead Plaintiff and Lead Counsel and for Extension of Time, ECF No. 60.
Previously, the Court found that Schaedel had the largest financial interest in the
relief sought by the class and was the most adequate plaintiff, and consequently appointed
him as lead plaintiff in this putative class action brought pursuant to the Private Securities
Litigation Reform Act of 1995 (“PSLRA”). See generally ECF No. 54. The Court also
approved Schaedel’s selection of the law firm of Wolf Haldenstein Adler Freeman & Herz
LLP (“Wolf Haldenstein”) to serve as lead counsel for the putative class. See generally
ECF No. 54. In doing so, the Court denied without prejudice the Trust’s motion for
appointment as lead plaintiff and approval of its selection of counsel as, at the time, the
Trust conceded it did not appear to possess the largest financial interest. See 15 U.S.C.
§ 78u-4(a)(3)(B)(iii)(I)(bb); see generally ECF No. 51; ECF No. 54.
Following further “investigation into the claims asserted in the complaint to inform
the drafting of an amended complaint,” Schaedel and Wolf Haldenstein have determined
that the initial putative class period should be revised. Unopposed Mot. at 2. The new
putative class period is narrower than the initial period and now runs March 1 through May
17, 2022. 1 Unopposed Mot. at 2; ECF No. 64 at 1. Schaedel did not purchase Target stock
during this revised period and, consequently, “recognizes he would not have standing to
represent a class of investors” for such period. Unopposed Mot. at 2.
Under the PSLRA, the Court is required to “appoint as lead plaintiff 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.” 15 U.S.C. § 78u-4(a)(3)(B)(i).
The Court “plays an important role of protector of the absentee class members’ interests;
its decision to appoint a lead plaintiff and class counsel to advocate for them places a
fiduciary burden on the Court to ensure that their interests receive adequate representation.”
Pelletier v. Endo Int’l PLC, No. 17-cv-5114, 2021 WL 398495, at *10 (E.D. Penn. Feb. 4,
2021) (quotation omitted).
As such, “courts have a continuing duty to reconsider
leadership roles if concerns arise about adequately serving the class.” Id.; see also, e.g., In
re NYSE Specialists Sec. Litig., 240 F.R.D. 128, 133 (S.D. N.Y. 2007) (“Courts have
In the motion, the new putative class period is described as running through May 18, 2022. Unopposed Mot. at 2.
The Court inquired of counsel as to the correctness of the May 18 end date as the period originally noticed ended on
May 17, 2022. ECF No. 24-1 at 8 (“between August 18, 2021 and May 17, 2022, inclusive”). By letter, it was
confirmed that the “motion contained an inadvertent typographical error,” and the end of the new period was
intended to be May 17, consistent with the prior notice. ECF No. 64 at 1.
interpreted their lead plaintiff responsibilities under the PSLRA to encompass a continuing
duty to monitor whether lead plaintiffs are capable of adequately protecting the interests of
class members.” (quotation omitted)). Here, consistent with his obligation to act on behalf
of and for the benefit of the putative class, Schaedel has candidly advised the Court that he
is no longer best suited to do so. See In re NYSE Specialists Sec. Litig., 240 F.R.D. at 134
(“It is certainly within the lead plaintiff[’s] discretion and, perhaps more importantly, part
of a lead plaintiff’s responsibility to propose their own withdrawal and substitution should
it be discovered that they may no longer adequately represent the interests of the purported
Again, there is a rebuttal presumption under the PSLRA that the “most adequate
plaintiff” is the member who has (1) filed the complaint or moved for appointment as lead
plaintiff; (2) “has the largest financial interest in the relief sought by the class”; and (3)
“otherwise satisfies the requirements of Rule 23 of the Federal Rules of Civil Procedure.”
15 U.S.C. § 78u-4(a)(3)(B)(iii)(I). Subject to court approval, the most adequate plaintiff
“select[s] and retain[s] counsel to represent the class.” Id. § 78u-4(a)(3)(B)(v).
As noted above, the Trust previously filed a timely motion for appointment. See
generally ECF Nos. 19-22, 24; cf. In re Portal Software, Inc. Sec. Litig., No. C-03-5138
VRW, 2005 WL 8179740, at *4 (N.D. Cal. Mar. 9, 2005)
(“[T]he need to add
representative plaintiffs may arise after a case has been initiated. It would turn securities
litigation into a game of snakes and ladders to hold that any time a new plaintiff is added,
the action must ‘go back to square one’ and recommence the PSLRA lead plaintiff selection
process.”). The Trust alleged losses of $126,041.31 in connection with its Target stock,
which was second only to Schaedel. ECF No. 21 at 11; ECF No. 24-1 at 5. The only other
movants that purchased Target stock during the new, narrower class period were John W.
Zlatic and Chester Zoll (collectively, “Zlatic & Zoll”). Unopposed Mot. at 3; see generally
ECF Nos. 34-37. Zlatic & Zoll do “not dispute that the Trust is the presumptive lead
plaintiff.” Unopposed Mot. at 3.
Accordingly, the Trust “is entitled to lead plaintiff status so long as it satisfies the
typicality and adequacy requirements of Rule 23.” Mart v. Tactile Sys. Tech., Inc., No. 20cv-2074 (NEB/BRT), 2021 WL 321624, at *2 (D. Minn. Feb. 1, 2021); see also, e.g.,
Steamfitters Local 449 Pension & Retirement Sec. Funds v. Sleep Number Corp., No. 21cv-2669 (PJS/BRT), 2022 WL 1607306, at *3 (D. Minn. May 20, 2022) [hereinafter
Steamfitters]; Erickson v. Hutchinson Tech. Inc., Nos. 15-cv-4261, 15-cv-4321, 15-cv4338, 15-cv-4356 (DSD/LIB), 2016 WL 8199314, at *4 (D. Minn. Apr. 1, 2016), report
and recommendation adopted, 2016 WL 8200934 (D. Minn. Apr. 20, 2016). “Typicality
exists where the plaintiff’s claims arise from the same series of events or are based on the
same legal theories as the claims of all the class members.” Erickson, 2016 WL 8199314,
at *4; accord Mart, 2021 WL 321624, at *2; see Steamfitters, 2022 WL 1607306, at *3.
“Adequacy exists where (1) the plaintiff and its attorneys ‘are able and willing to prosecute
the action competently and vigorously’ and (2) the plaintiff’s ‘interests are sufficiently
similar to those of the class that it is unlikely that their goals and viewpoints will diverge.’”
Mart, 2021 WL 321624, at *2 (quoting Erickson, 2016 WL 8199314, at *5) (internal
quotation omitted); cf. Steamfitters, 2022 WL 1607306, at *3. At this stage, the Trust “need
only make a preliminary showing that it has claims that are typical to the putative class and
has the capacity to provide adequate representation for those class members.” Erickson,
2016 WL 8199314, at *4; see Steamfitters, 2022 WL 1607306, at *3 (initial inquiry into
typicality and adequacy requirements “need not be extensive” (quotation omitted)).
Based on the submissions, the Court finds that Trust’s claims are typical of the
claims of the putative class alleged in the Complaint. Compare ECF No. 21 at 12-13 with
ECF No. 1. The Court additionally finds that the Trust will fairly and adequately protect
the interests of the putative class. The Trust understands that “a lead plaintiff is required
to direct the litigation on behalf of the Class, stay apprised of all material developments of
the litigation, and act in the best interests of the Class throughout the litigation.” ECF No.
24-1 at 14. The Trust also acknowledges the responsibilities associated with serving as the
lead plaintiff, “including providing testimony at deposition and trial, if necessary.” ECF
No. 24-1 at 2. There is nothing to suggest that the Trust’s interests are in conflict with the
putative class or that the Trust is subject to any unique defenses vis-à-vis the Defendants.
And, as discussed below, the Trust has proposed the approval of competent and
experienced counsel to assist it in representing the interests of the putative class.
Accordingly, the Court finds the Trust to be the most adequate plaintiff in light of the new,
narrowed putative class period. Accordingly, the Court substitutes the Trust for Schaedel
and appoints the Trust as lead plaintiff in this action.
“Once the Court has determined the most adequate plaintiff, that plaintiff ‘shall,
subject to the approval of the court, select and retain counsel to represent the class.” Mart,
2021 WL 321624, at *2 (quoting 15 U.S.C. § 78u-4(a)(3)(B)(v)). “The Court should not
disturb the lead plaintiff’s choice of counsel unless it is necessary to protect the interests
of the class.” Id. The Trust has selected the law firm of Levi & Korsinsky, LLP to serve
as lead counsel for the putative class with Wolf Haldenstein, the firm previously approved
as lead counsel, serving as liaison counsel. Unopposed Mot. at 3; see ECF No. 21 at 1516. The Trust has submitted the firm resume of Levi & Korsinsky demonstrating its
extensive experience in securities litigation. Based on the evidence before the Court, Levi
& Korsinsky is well qualified to represent the putative class. Accordingly, the Court also
approves the Trust’s selection of Levi & Korsinsky. Levi & Korsinsky is substituted for
Wolf Haldenstein as lead counsel and Wolf Haldenstein shall serve as liaison counsel. 2
Should the Trust be appointed as the new lead plaintiff and its selection of counsel
be approved, the Trust has requested an extension of the existing deadlines for filing an
amended complaint and Defendants to answer or otherwise respond to that pleading so that
it “may get up to speed on the investigation.” Unopposed Mot. at 3; see generally ECF
No. 59. In consultation with the chambers of the presiding district judge, the Honorable
Patrick J. Schiltz, Chief District Judge for the United States District Court for the District
of Minnesota, the Court will grant an extension of those deadlines as set forth below. The
parties are cautioned, however, that no further extensions will be granted.
First, the Court notes that Levi & Korsinsky has not yet appeared in this action. Counsel shall take immediate
action to enter notices of appearance in this matter and, if necessary, seek temporary admission pro hac vice in
accordance with D. Minn. LR 83.5(d). See Unopposed Mot. at 8 (noting intention to apply for pro hac vice
admission). Second, while there is a notation under the signature block for the Trust’s current local counsel
(Reinhardt, Wendorf & Blanchfield) indicating that such counsel is the proposed liaison counsel for the class,
Unopposed Mot. at 8, Wolf Haldenstein has confirmed via e-mail that this notation was in error and it will remain as
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
1. The Unopposed Motion to Substitute Lead Plaintiff and Lead Counsel and for
Extension of Time, ECF No. 60, is GRANTED IN PART and DENIED IN
PART as set forth herein.
2. Pursuant to 15 U.S.C. § 78u-4(a)(3)(B), the Terry and Diane Van Der Tuuk
Living Trust is substituted for Gary Schaedel and appointed to serve as lead
plaintiff in this matter.
3. Pursuant to 15 U.S.C. § 78u-4(a)(3)(B)(v), the law firm of Levi & Korsinsky,
LLP is substituted for Wolf Haldenstein Adler Freeman & Herz LLP and
approved as lead counsel. Wolf Haldenstein Adler Freeman & Herz LLP shall
serve as liaison counsel.
4. Plaintiff shall file an amended complaint on or before December 15, 2023.
5. Defendants shall file a motion to dismiss or otherwise respond to the amended
complaint on or before March 8, 2024.
6. If Defendants file a motion to dismiss, Plaintiff shall file any opposition to the
motion to dismiss on or before April 19, 2024.
7. If Plaintiff files an opposition to the motion to dismiss, Defendants shall file any
reply to the opposition on or before May 31, 2024.
8. The hearing on any motion to dismiss will take place before Chief Judge Schiltz,
on June 14, 2024, at 8:30 a.m., in Courtroom 15 of the Diana E. Murphy United
States Courthouse, 300 South Fourth Street, Minneapolis, Minnesota.
Dated: November 13 , 2023
s/ Tony N. Leung
Tony N. Leung
United States Magistrate Judge
District of Minnesota
Perez v. Target Corp. et al.
Case No. 23-cv-769 (PJS/TNL)
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