Pendleton v. Reid et al

Filing 40

ORDER granting 30 Unopposed Motion for Settlement and granting 38 Joint Motion for Entry of Final Judgment. The Clerk is directed to close this case. Signed by District Judge Robert J. Conrad, Jr on 3/7/2018. (nvc)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NORTH CAROLINA
STATESVILLE DIVISION
Case No. 05:16-CV-00037
CURTIS PENDLETON and FLOYD
SCROGHAM, individually and
on behalf of all others similarly situated,

)
)
)
)
Plaintiff,
)
)
v.
)
)
ROBERT L. REID, SCOTT B. KAUFFMAN,
)
JERRY R. LICARI, J. CHANDLER MARTIN, )
T. GRAY MCCASKILL, H. RAY
)
MCKENNEY, JR., JOHN C. REDETT,
)
BOYD C. WILSON, JR., COMMUNITYONE
)
BANCORP, and CAPITAL BANK
)
FINANCIAL CORP.,
)
)
Defendants.
)
)
__________________________________________ )

ORDER

THIS MATTER comes before the Court on Curtis Pendleton’s Unopposed
Motion for Settlement, (Doc. No. 30), and Joint Motion for All Parties for Entry of
Final Judgment, (Doc. No. 38).
Previously, the Court granted Plaintiff's Unopposed Motion for Preliminary
Approval of Class Action Settlement (the “Notice Order”) for final approval of the
terms of a Stipulation of Settlement dated as of January 31, 2017 (“Stipulation”),
made and entered into by and among:
(i)

Plaintiffs Curtis
“Plaintiffs”) and

Pendleton and Floyd Scrogham (collectively,

(ii)

Defendants CommunityOne Bancorp (“CommunityOne”), Capital Bank
Financial Corp. (“Capital Bank”), Robert L. Reid, Scott B. Kauffman,
Jerry R. Licari, J. Chandler Martin, T. Gray McCaskill, H. Ray
McKenney, John C. Redett, Boyd C. Wilson, Jr. (collectively,
“Defendants,” and together with Plaintiffs, the “Parties”).

(Doc. Nos. 27, 29). Defendants constitute all of the parties in the above-captioned
action (the “Action”).
The Court held a hearing on July 31, 2017 (the “Settlement Hearing”) to
consider the proposed settlement as embodied in the Stipulation (the “Settlement”).
(Doc. No. 36). Due, adequate, and sufficient notice has been given in accordance with
the Notice Order and all parties duly appearing having been heard. Furthermore, an
opportunity to be heard has been given to all other persons desiring to be heard as
provided in the Notice Order and no such persons have submitted timely objections
as provided in the Notice Order. The entire matter of the Settlement, therefore, has
been heard and considered by the Court.
IT IS HEREBY ORDERED, ADJUDGED, AND DECREED THAT:
1.

This Court has jurisdiction over the subject matter of the Action and, for

the purposes of settlement of the Action only, over all parties to the Action, including
but not limited to, Plaintiffs, all members of the Settlement Class (as defined below),
and the Defendants.
2.

The Court finds, for purposes of settlement only, that each of the

requirements of Fed. R. Civ. P. 23 has been satisfied, in that:

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(a) the members of the Settlement Class are so numerous that separate
joinder of each member is impracticable,
(b) Plaintiffs’ claim or defense raises questions of law or fact common to the
questions of law or fact raised by the claim or defense of each member of
the class,
(c) Plaintiffs’ claim or defense is typical of the claim or defense of each member
of the class,
(d) Plaintiffs can fairly and adequately protect and represent the interests of
each member of the class,
(e) the prosecution of separate claims or defenses by or against individual
members of the Settlement Class would create a risk of either:
(i)

inconsistent or varying adjudications concerning individual
members of the Settlement Class, which would establish
incompatible standards of conduct for Defendants; or

(ii)

adjudications concerning individual members of the Settlement
class, which would, as a practical matter, be dispositive of the
interests of other members of the Settlement Class who are not
parties to the adjudications, or substantially impair or impede
the ability of other members of the Settlement Class who are not
parties to the adjudications to protect their interests; and

(f) Plaintiffs' claims that Defendants have acted or refused to act on grounds
generally applicable to all the members of the Settlement Class, thereby

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making final injunctive relief or declaratory relief concerning the class as
a whole appropriate.
3.

Pursuant to Fed. R. Civ. P. 23, the Court hereby certifies, for settlement

purposes only, a non-opt-out class consisting of any and all record holders and
beneficial owners of common stock of CommunityOne who held or owned such stock
at any time during the period beginning on and including November 23, 2015,
through and including the date of consummation of the Merger on October 26, 2016
(the “Class Period”), including any and all of their respective successors-in-interest,
successors,

predecessors-in-interest,

predecessors,

representatives,

trustees,

executors, administrators, estates, heirs, beneficiaries, legatees, devisees, assigns
and transferees, immediate and remote, and any other person or entity acting for or
on behalf of, or claiming under, any of the foregoing (the “Settlement Class”); provided
that Settlement Class shall not include Defendants and their immediate family
members, any entity in which any Defendant has a controlling interest, and any
successors in interest thereto.
4.

The Notice of Pendency and Proposed Settlement of Class Action (the

“Notice”) was sent to the Settlement Class Members pursuant to and in the manner
directed by the Notice Order. Additionally, on July 11, 2017, notice pursuant to 28
U.S.C. § 1715 enacted as a component of the Class Action Fairness Act of 2005
(“CAFA Notice”), was sent to state and federal officials pursuant to that statute.
Proof of such notice was filed with the Court on July 14, 2017. A full opportunity to
be heard has been afforded to all parties, the Settlement Class Members, the

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recipients of the CAFA Notice and persons in interest. The form and manner of the
Notice is hereby determined to have been the best notice practicable under the
circumstances and is due and sufficient notice to the members of the Settlement Class
pursuant to Fed. R. Civ. P. 23, due process and any other applicable law. The Court
further finds that the notice provisions of the Class Action Fairness Act, 28 U.S.C. §
1715, have been fully discharged and that the 90-day period provided for in 28 U.S.C.
§ 1715(d) has expired. All Settlement Class Members are bound by this Order and
Final Judgment.
5.

The Court finds that the Settlement set forth in the Stipulation is fair,

reasonable and adequate and in the best interests of the Settlement Class, and should
be approved. Accordingly, the Stipulation and the terms of the Settlement as
described in the Stipulation are hereby approved in their entirety and incorporated
into this Order and Final Judgment. The parties to the Settlement are hereby
directed to consummate the Settlement in accordance with the terms and provisions
of the Stipulation. Plaintiffs, all Settlement Class Members and Defendants are
hereby bound by the terms of the Settlement as set forth in the Stipulation.
6.

Upon the Effective Date of the Settlement (as defined in the

Stipulation), any and all manner of claims, demands, rights, liabilities, damages,
losses, obligations, duties, costs, debts, expenses, interest, penalties, sanctions, fees,
attorneys’ fees, actions, potential actions, causes of action, suits, agreements,
judgments,

defenses,

counterclaims,

offsets,

decrees,

matters,

issues

and

controversies of any kind, nature, or description whatsoever, whether known or

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unknown, disclosed or undisclosed, accrued or unaccrued, apparent or not apparent,
foreseen or unforeseen, matured or not matured, suspected or unsuspected,
liquidated or not liquidated, fixed or contingent, that Plaintiffs or any or all other
Settlement Class Members ever had, now have, or may have, whether direct,
derivative, individual, class, representative, legal, equitable, or of any other type, that
could be brought by any Settlement Class Member based on his, her, or its ownership
of CommunityOne stock during the Class Period, against any and every entity or
natural person named as a defendant in the complaint or amended complaint in any
of the Actions, and each of their respective past, present, or future family members,
spouses, heirs, trusts, trustees, executors, estates, administrators, beneficiaries,
distributees, legatees, devisees, foundations, agents, employees, fiduciaries, partners,
control persons, partnerships, general or limited partners or partnerships, joint
ventures, member firms, limited liability companies, corporations, parents,
subsidiaries, divisions, affiliates, associated entities, stockholders, principals,
officers, managers, directors, managing directors, members, managing members,
managing agents, predecessors, predecessors-in-interest, successors, successors-ininterest, assigns, financial or investment advisors, advisors, consultants, investment
bankers, entities providing any fairness opinion, underwriters, brokers, dealers,
lenders, commercial bankers, attorneys, personal or legal representatives,
accountants, insurers, co-insurers, reinsurers, and associates, whether or not such
persons and entities were served with process or appeared in the Actions (“Released
Persons”), in any court, tribunal, forum or proceeding, whether based on state, local,

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foreign, federal, statutory, regulatory, common or other law or rule (including, but
not limited to, any claims under federal securities laws or state disclosure law or any
claims that could be asserted derivatively on behalf of CommunityOne), which, now
or hereafter, are based upon, arise out of, relate in any way to, or involve, directly or
indirectly:
(i)

the Merger or the Merger Agreement;

(ii)

any deliberations or negotiations in connection with the Merger
or the Merger Agreement, including the process of deliberation
or negotiation by Defendants, and any of their respective officers,
directors, principals, partners, or advisors;

(iii)

the consideration to be received by Class members in connection
with the Merger;

(iv)

any other transaction or strategic option that CommunityOne
did consider or could have considered as an alternative to the
Merger;

(v)

the S-4 and all amendments thereto, the definitive joint proxy
statement, and/or any public filings, press releases, or other
disclosures made available or filed relating, directly or indirectly,
to the Merger;

(vi)

any of the allegations in any of the complaints in the Actions, or
any other actions, transactions, occurrences, statements,
representations, omissions, allegations, facts, practices, events,

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claims, or any other matters, things, or causes whatsoever, that
could have been, or in the future can or might be alleged,
asserted, set forth, claimed, embraced, involved, or referred to in,
or otherwise related in any way to, the Actions or the subject
matter of the Actions; or
(vii)

any benefits or consideration received by any of the Defendants
in connection with the Merger (the “Settled Claims”) shall be
deemed to have, and by operation of this Order and Final
Judgement shall have fully, finally and forever be completely,
individually, collectively, and derivatively, settled, released,
discharged, extinguished and dismissed with prejudice on the
merits; provided, however, that the Settled Claims shall not
include claims or rights to enforce the Settlement or any claims
or rights of any Defendant against its insurers or its insurers’
successors or assignees.

7.

Upon the Effective Date of the Settlement (as defined in the

Stipulation), Defendants shall be deemed to have, and by operation of this Order and
Final Judgment shall have, released Plaintiffs and Plaintiffs’ Counsel from any and
all claims, complaints, petitions, or sanctions arising out of the investigation,
commencement, prosecution, settlement, or resolution of the Actions; provided,
however, that Defendants shall retain the right to enforce the terms of this

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Stipulation and the Settlement and any claims or rights of any Defendant against its
insurers or insurers’ successors or assignees.
8.

The Action is hereby dismissed as against all Defendants on the merits

and with prejudice and without costs to any party as against any other party, except
as otherwise agreed to in the Stipulation and as set forth herein.
9.

Plaintiffs, and all members of the Settlement Class, are permanently

barred and enjoined from asserting, commencing, prosecuting, assisting, instigating,
continuing, or in any way participating in the commencement or prosecution of any
action in any forum, whether directly, representatively, derivatively, or in any other
capacity, asserting any claims that are, or relate in any way to, any Settled Claims
against any Released Persons.
10.

The Court, having considered the nature of the Action, the time and

effort expended by Plaintiffs’ Counsel, and the results obtained on behalf of the
Settlement Class, hereby orders that CommunityOne or its successor(s) shall pay, on
behalf of all Defendants, the sum of $500,000.00 in attorneys’ fees, costs and expenses
to Plaintiffs’ Counsel in accordance with, and subject to the terms and conditions of
the Stipulation.
11.

Neither the Stipulation, the MOU (as defined in the Stipulation), the

Settlement, this Order and Final Judgment, nor any act, communication or document
relating to, or in furtherance of, the foregoing:

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(a) is or may be deemed to be or may be used in any way as an admission of,
or evidence of, the validity or lack of validity of any Settled Claims or of
any wrongdoing or liability of Defendants or any Released Persons; or
(b) is or may be deemed to be or may be used in any way as an admission of,
or evidence of, any fault or omission of any of the Defendants or any other
Released Persons in any civil, criminal, or administrative proceeding in
any court, administrative agency, or other tribunal.
Notwithstanding the foregoing, any of the Released Persons may file the Stipulation
or any judgment or order of the Court related hereto, in any action or proceeding in
this Court or otherwise, to argue, support or establish any claim, defense or
counterclaim based on principles of res judicata, collateral estoppel, release, goodfaith settlement, judgment bar or reduction, or any other theory of claim preclusion
or issue preclusion, or similar claim, defense or counterclaim, or to secure or attempt
to secure any insurance rights or proceeds of any of the Released Persons.
12.

The Court approves the Settlement and reserves jurisdiction, without

affecting the finality of this Order and Final Judgment, over the enforcement and
administration of the Settlement and this Order and Final Judgment.
13.

If the Settlement does not become effective in accordance with the terms

of the Stipulation for any reason, the Stipulation, any class certification and any
actions taken or to be taken in connection therewith (including this Order and Final
Judgment) shall be vacated, terminated and shall become null and void and of no
further force and effect to the extent and as provided for in the Stipulation.

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14.

All capitalized terms not defined in this Final Judgment shall have the

meanings ascribed to them in the Stipulation.
15.

There being no just reason for delay, the Court hereby directs that this

Order and Final Judgment be entered by the Clerk of the Court.
IT IS, THEREFORE, ORDERED that:
1.

Curtis Pendleton’s Unopposed Motion for Settlement, (Doc. No. 30), is
GRANTED;

2.

Curtis Pendleton’s Joint Motion for All Parties for Entry of Final
Judgment, (Doc. No. 38), GRANTED; and

3.

The Clerk of Court is directed to close this case.

Signed: March 7, 2018

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