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MILBERG WEISS BERSHAD
HYNES & LERACH LLP
ALAN SCHULMAN (128661)
MARK SOLOMON (151949)
MICHAEL L. SCHRAG (185832)
600 West Broadway, Suite 1800
San Diego, CA 92101
Telephone: 619/231-1058
- and -
KIMBERLY C. EPSTEIN (169012)
222 Kearny Street, 10th Floor
San Francisco, CA 94108
Telephone: 415/288-4545
WEISS & YOURMAN
JOSEPH H. WEISS
JACK I. ZWICK
551 Fifth Avenue
Suite 1600
New York, NY 10176
Telephone: 212/682-3025
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KEVIN J. YOURMAN (147159)
10940 Wilshire Blvd.
24th Floor
Los Angeles, CA 90024
Telephone: 310/208-2800
BERNSTEIN LIEBHARD & LIFSHITZ
MEL E. LIFSHITZ
274 Madison Avenue
New York, NY 10016
Telephone: 212/779-1414
Attorneys for Plaintiffs
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION
| BROOKE GRAUBART, et al., On Behalf
of Themselves and All Others Similarly Situated, Plaintiffs, vs. INSIGNIA SOLUTIONS PLC, et al.,
Defendants.
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No. C-97-20265-JW(EAI)
CLASS ACTION DATE: June 30, 1997
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TABLE OF CONTENTS
I. INTRODUCTION
II. ARGUMENT
2. Movants Are The Most Adequate Plaintiffs Because They Have The Largest Financial Interest In The Relief Sought By The Class
3. Movants Otherwise Satisfy Federal Rule of Civil Procedure 23
b. Movants Will Fairly And Adequately Represent The Interests Of The Class
TO: ALL PARTIES AND THEIR ATTORNEYS OF RECORD
PLEASE TAKE NOTICE that, on Monday, June 30, 1997, at 9:00 a.m., or as soon thereafter as the Court may hear this motion, in the Courtroom of The Honorable James Ware, United States District Court, 280 South First Street, San Jose, California 95113, plaintiff Brooke Graubart, who filed a complaint against defendants for violations of federal securities laws on March 24, 1997, along with David R. Fried and Bruce Lieb (collectively, "Movants") will, and hereby do, move this Court, pursuant to §21D(a)(3)(B) of the Securities Exchange Act of 1934 (the "Exchange Act"), as amended by the Private Securities Litigation Reform Act of 1995 ("PSLRA"), 15 U.S.C. §78u-4(a)(3)(B), to be appointed Lead Plaintiffs in this action and for the approval of Movants' choice of Milberg Weiss Bershad Hynes & Lerach LLP ("Milberg Weiss") as Plaintiffs' Lead Counsel.
This motion is made on the grounds that Movants are the most adequate plaintiffs, as provided in the PSLRA, because having purchased, collectively, over 100,000 American Depository Shares ("ADS") of defendants Insignia Solutions, PLC, operating through its subsidiary Insignia Solutions, Inc. (collectively "Insignia" or the "Company"), and suffered losses of over $170,000, they have the largest financial interest in the relief sought by the class. In addition, Movants meet the requirements of Rule 23 of the Federal Rules of Civil Procedure in that their claims are typical of the claims of the class and they will fairly and adequately represent the claims of the class. Finally, Movants have appropriately selected and retained Milberg Weiss, a firm with substantial experience in prosecuting securities fraud class actions, to serve as lead counsel for the class.
This motion is based upon this Notice of Motion and the attached supporting
Memorandum of Points and Authorities, the accompanying Declaration of Michael
L. Schrag, the complete files and records in this action and such other
evidence as the Court may consider at the hearing on this motion.
Defendants' fraudulent course of conduct caused Insignia ADSs to trade at artificially inflated prices, as high as $22 per share. ¶4. When defendants disclosed on February 27, 1997 that due to accounting "irregularities" that resulted in improper revenue recognition, the Company would have to restate its revenues and net income for the first two quarters of 1996, the price of Insignia ADSs fell to $2-1/2 per share. ¶6. While class members lost millions as a result of defendants' fraud, certain Insignia insiders pocketed over $20 million from selling Insignia ADSs at inflated prices during the Class Period. ¶2.
Plaintiffs allege violations of §§10-b and 20(a) of the Securities
Exchange Act of 1934 (the "Exchange Act") and Securities and Exchange Commission
("SEC") Rule 10b-5 against defendants Insignia, Robert P. Lee, Roger D.
Friedberger, Paul R. Griffiths, John R. Johnston, Richard M. Noling, Nicholas
A. Samuel and David L. Gibbs. Plaintiff Brooke Graubart, brings this motion
along with David R. Fried and Bruce Lieb who are class members not individually
named in the Complaint.(2) Each Movant purchased Insignia ADSs
during the Class Period and suffered damages as a result of defendants'
violations of federal securities laws. Collectively, Movants purchased
over 100,000 Insignia ADSs and lost over $170,000. See Exhibit 1
to the Declaration of Michael L. Schrag ("Schrag Decl."). As set forth
below, these facts entitle Movants to be appointed Lead Plaintiffs.
the plaintiff or plaintiffs shall cause to be published, in a widely circulated national business-oriented publication or wire service, a notice advising members of the purported plaintiff class --15 U.S.C. §78u-4(a)(3)(A)(i).(I) of the pendency of the action, the claims asserted therein, and the purported class period; and
(II) that, not later than 60 days after the date on which the notice is published, any member of the purported class may move the court to serve as lead plaintiff of the purported class.(3)
On March 24, 1997, plaintiffs filed their Complaint and through their
counsel, published the required notice on the
Business Wire, a widely
circulated wire service.(4) As Movants have filed this motion
within 60 days after publishing their Notice, they have properly followed
the PSLRA's procedure.
shall 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 (hereafter in this paragraph referred to as the "most adequate plaintiff") in accordance with this subparagraph.§21D(a)(3)(B)(i) (emphasis added). Moreover, §21D(a)(3)(B)(iii) of the Exchange Act, as amended by the PSLRA, requires a court to adopt a rebuttable presumption
that the most adequate plaintiff in any private action arising under this title is the person or group of persons that --15 U.S.C. §78u-4(a)(3)(B)(iii) (emphasis added). Thus the statutory language provides that a "member or members" of the class or a "person or group of persons" may combine to constitute "the largest financial interest" and thereby jointly serve as the "most adequate plaintiff."* * *
(bb) in the determination of the court, has the largest financial interest in the relief sought by the class . . . .
During the Class Period, Movants collectively purchased over 100,000 Insignia ADSs at prices artificially inflated by defendants' false and misleading statements during the Class Period and collectively have incurred losses in excess of $170,000. See Schrag Decl., Ex. 1. In the aggregate, Movants have a significant financial interest in this case. Only class members who have filed a complaint or made a motion pursuant to §21D(a)(3)(B), are eligible to be appointed lead plaintiffs. To Movants' knowledge, no other class member has filed a complaint or moved to be appointed lead plaintiff. Thus, Movants possess the largest financial interest in the outcome of this litigation of any eligible class member or other group of class members, and, this Court should presume that they are the most adequate plaintiffs.
In addition, Movants are qualified to represent the class. Each of them
signed a certification stating that they have reviewed the Complaint, approve
of its filing and are willing to serve as a representative party on behalf
of the class. Plaintiff Graubart filed her certification with the Complaint.
See Schrag Decl., Ex. 3. Messrs. Lieb and Fried are submitting their
certifications as Exhibits 4 and 5 to the Schrag Declaration. Therefore,
Movants satisfy the prerequisites for appointment as Lead Plaintiffs pursuant
to §21D(a)(3)(B).
As detailed below, Movants satisfy the typicality and adequacy requirements
of Rule 23(a), justifying their appointment as Lead Plaintiffs.
The claims that Movants assert are typical of the claims of the members
of the class. Each of the Movants, as do all members of the class, allege
that defendants violated the Exchange Act by publicly disseminating a series
of false and misleading statements concerning Insignia's IPO, growth potential,
and financial statements throughout the Class Period, and by including
this false information in the Company's Prospectus, Registration Statement
and filings with the SEC. Each of the Movants, as did all of the members
of the class, acquired Insignia ADSs at prices inflated by defendants'
misrepresentations and omissions and, suffered damages. Thus, typicality
is satisfied because Movants' claims arise "from the same event or course
of conduct giving rise to the claims of other class members" and are "based
on the same legal theory." SeeIn re United Energy Corp. Solar Power
Modules Tax Shelter Inv. Sec. Litig., 122 F.R.D. 251, 256 (C.D. Cal.
1988).
Milberg Weiss possesses extensive experience in the area of securities litigation and has successfully prosecuted numerous securities fraud class actions on behalf of injured investors. See Schrag Decl., Ex. 7. When Milberg Weiss moved to be appointed lead counsel in one recent federal securities fraud action, Chief Judge Tauro stated:
[T]he court concludes (1) that Movants should be appointed lead plaintiff, and (2) that, in light of the conceded expertise of Milberg, Weiss, Bershad, Hynes & Lerach in securities class actions, the court should approve Movants' selection of that firm as lead counsel.Greebel v. FTP Software, 939 F. Supp. 57, 64 (D. Mass. 1996). Thus, the Court may be assured that if it grants this motion the members of the class will receive the highest caliber of legal representation available.
| DATED: May 21, 1997 | Respectfully submitted,
MILBERG WEISS BERSHAD
______________________________
600 West Broadway, Suite 1800
MILBERG WEISS BERSHAD
Proposed Lead Counsel for
WEISS & YOURMAN
WEISS & YOURMAN
BERNSTEIN LIEBHARD & LIFSHITZ
Attorneys for Plaintiffs |
INSIGN-2\DB00139.MTN
1. Unless otherwise indicated, all paragraph references ("¶__") are to Plaintiffs' Complaint For Violation Of The Federal Securities Laws (the "Complaint"), filed with this Court on March 24, 1997.
2. §21D(a)(3)(B)(i) of the PSLRA states that "the court shall consider any motion made by a purported class member in response to the notice, including any motion by a class member who is not individually named as a plaintiff in the complaint or complaints . . . ."
3. Section 21D(a)(3)(B) of the Exchange Act directs the Court to consider any motions by purported class members to serve as lead plaintiffs in response to any such notice by the later of (i) 90 days after the date of publication; or (ii) as soon as practicable after the court decides any pending motion to consolidate any actions asserting substantially the same claim or claims.
4. A copy of this Notice is attached as Exhibit 2
to the Schrag Declaration.
5 Feb 1998
Source: Milberg Weiss website