esempio di "settlement" x class action (ADAC LABS Inc.)

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Per dare un'idea di come potrebbe finire una qualunque class action finanziaria in USA, allego la proposta di definizione per la class action ADAC LABORATORIES, INC.
Pietro66

SUPERIOR COURT OF THE STATE OF CALIFORNIA COUNTY OF SANTA CLARA SIDNEY OLMSTED, et al., On Behalf of Themselves ) Case No. CV793923 and All Others Similarly Situated, ) ) CLASS ACTION Plaintiffs, ) ) Assigned To: Judge Jack Komar vs. ) ) ADAC LABORATORIES, et al., ) ) Defendants. )

NOTICE OF PENDENCY AND PROPOSED SETTLEMENT OF CLASS ACTION TO: ALL PERSONS WHO SOLD ADAC LABORATORIES, INC. (“ADAC”) STOCK IN CONNECTION WITH THE ACQUISITION OF ADAC BY KONINKLIJKE PHILIPS ELECTRONICS N.V. (“PHILIPS”) PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. YOUR RIGHTS MAY BE AFFECTED BY PROCEEDINGS IN THIS LITIGATION. PLEASE NOTE THAT IF YOU ARE A SETTLEMENT CLASS MEMBER, YOU MAY BE ENTITLED TO SHARE IN THE PROCEEDS OF THE SETTLEMENT DESCRIBED IN THIS NOTICE. TO CLAIM YOUR SHARE OF THIS FUND, YOU MUST SUBMIT A VALID PROOF OF CLAIM POSTMARKED ON OR BEFORE MAY 4, 2004.
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The proposed settlement creates a fund in the amount of $3,550,000 in cash (the “Settlement Fund”) and will include interest that accrues on the Settlement Fund prior to distribution. In addition, if the assets of ADAC are resold by Philips within two years of July 10, 2003 for more than Philips paid for them, Defendants agree to pay an additional $2 million to the Settlement Class. The Representative Plaintiffs believe that the proposed settlement is a good recovery and is in the best interests of the Settlement Class. Because of the risks associated with the Litigation and the related Federal Action, there was a danger that plaintiffs would not have prevailed on their claims in which case the class could have received nothing. The Defendants have denied, and continue to deny, that they have done anything wrong or have any liability whatsoever.
I. THE LITIGATION AND THE FEDERAL ACTION This Litigation is brought on behalf of the former stockholders of ADAC Laboratories, Inc. (“ADAC” or the “Company”) who sold their ADAC stock to Koninklijke Philips Electronics N.V. (“Philips”) in connection with the acquisition of ADAC by Philips via a November 2000 tender offer and subsequent merger (the “Tender Offer/Merger”). Philips ultimately purchased all of the outstanding shares of ADAC common stock for $426 million, or $18.50 per share, as part of and pursuant to an agreement and plan of merger dated November 12, 2000 (the “Merger Agreement”). On or about November 14, 2000, ADAC filed with the Securities and Exchange Commission (“SEC”) and subsequently mailed to its shareholders a Schedule 14D-9 (“14D-9”) indicating that it had entered into a merger agreement whereby Philips would acquire, via a tender offer and second step merger, all the outstanding shares of ADAC for approximately $426 million or $18.50 per share, and that the merger was designed to take place “as soon as practicable following the closing of the Tender Offer.” Plaintiffs allege the Tender Offer/Merger was structured and consummated in violation of Defendants’ fiduciary obligations because: (a) Prior to announcing the Tender Offer/Merger, Defendants allegedly artificially reduced the price of ADAC common stock in order to allow Philips to acquire ADAC at a markedly reduced price. In exchange, ADAC’s top officers/directors allegedly received millions of dollars in personal benefits; (b) In connection with the Tender Offer/Merger, ADAC senior insiders were allegedly given greater consideration for their ADAC shares than the consideration paid to Representative Plaintiffs and members of the class; and (c) Defendants allegedly disseminated false tender offer documents in order to facilitate the consummation of the Tender Offer/Merger. Beginning in November 2000, plaintiffs conducted an investigation of Defendants’ actions in connection with the Tender Offer/Merger, including a thorough review and analysis of all relevant SEC filings, press releases and reports about the Tender Offer/Merger, ADAC and Philips. Following the overruling in part of Defendants’ demurrer to plaintiffs’ Second Amended
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Complaint, the parties commenced formal discovery. In addition, Representative Plaintiffs responded to Defendants’ discovery in connection with class certification. On May 1, 2002, an action entitled Cummings v. Koninklijke Philips Electronics N.V., et al., Case No. C-02-02121-SI, was transferred to the United States District Court for the Northern District of California (the “Federal Action”). The Federal Action alleged violations of §14(d)(7) and Rule 14d-10 promulgated thereunder by the SEC, as well as §20(a) of the Securities Exchange Act of 1934 on behalf of a class of all persons who sold ADAC stock in connection with the Tender Offer/Merger. Plaintiffs alleged that they were damaged by the additional consideration diverted by Philips to ADAC insiders via the Tender Offer/Merger. The Litigation and the Federal Action seek relief based on the allegations that the contemplated Tender Offer/Merger constituted a breach of the fiduciary duties owed to the class by the Defendants, including the claim that Defendants agreed to negotiate exclusively with Philips for the sale of ADAC, if Philips agreed that ADAC insiders would be granted additional consideration in connection with and as a part of the Tender Offer/Merger. An agreement in principle was reached only after significant discovery had taken place and following arm’s-length negotiations between parties, who were represented by counsel with extensive experience and expertise in securities class action litigation, assisted by retired Justice John K. Trotter. During the negotiations, all parties had a clear view of the strengths and weaknesses of their respective claims and defenses. The Settling Parties all agreed to resolve the case on the terms set forth in the Mediation Proposal of Justice Trotter.


II. NOTICE OF HEARING ON PROPOSED SETTLEMENT A settlement hearing will be held on April 27, 2004, at 9:00 a.m., before the Honorable Jack Komar, at the Old Courthouse, 161 North First Street, San Jose, California (the “Settlement Hearing”). The purpose of the Settlement Hearing will be to determine: (1) whether the settlement consisting of $3.55 million (plus accrued interest) should be approved as fair, reasonable and adequate to the Settling Parties; (2) whether the proposed plan to distribute the settlement proceeds (the “Plan of Allocation”) is fair, reasonable, and adequate; (3) whether the application by Representative Plaintiffs’ Counsel for an award of attorneys’ fees and expenses should be approved; and (4) whether the Litigation should be dismissed with prejudice. The Court may adjourn or continue the Settlement Hearing without further notice to the Settlement Class.

III. DEFINITIONS USED IN THIS NOTICE As used in this Notice the following terms have the meanings specified below:
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IV. CLAIMS OF THE REPRESENTATIVE PLAINTIFFS AND BENEFITS OF SETTLEMENT The Representative Plaintiffs believe that the claims asserted in the Litigation and Federal Action have merit. However, Representative Plaintiffs’ Counsel recognize and acknowledge the expense and length of continued proceedings necessary to prosecute the Litigation and the Federal Action against the Defendants through trial and through appeals. Counsel for the Representative Plaintiffs also have taken into account the uncertain outcome and the risk of any litigation, especially in a complex action such as this Litigation and the Federal Action, as well as the difficulties and delays inherent in such litigation. Representative Plaintiffs’ Counsel also are mindful of the inherent problems of proof and possible defenses to the claims asserted in the Litigation and the Federal Action. Representative Plaintiffs’ Counsel believe that the settlement set forth in the Stipulation confers substantial benefits upon the Settlement Class. Based on their evaluation, Representative Plaintiffs’ Counsel have determined that the settlement set forth in the Stipulation is in the best interests of the Representative Plaintiffs and the Settlement Class. V. DEFENDANTS’ STATEMENT AND DENIALS OF WRONGDOING AND LIABILITY The Defendants have denied and continue to deny each and all of the claims and contentions alleged by the Representative Plaintiffs in the Litigation and the Federal Action. The Defendants expressly have denied and continue to deny all charges of wrongdoing or liability against them as alleged in the complaint, and specifically deny that the 14D-9, or any other disclosure document, was incomplete or misleading, that any additional disclosure was required under SEC rules or any applicable legal principle, that they breached their fiduciary duties in connection with the Tender Offer/Merger, or that any additional consideration was provided to any ADAC insider in connection with the Tender Offer/Merger. The Defendants also have denied and continue to deny, inter alia, the allegations that the Representative Plaintiffs or the Settlement Class have suffered damage or that the Representative Plaintiffs or the Settlement Class were harmed by the conduct alleged in any of plaintiffs’ complaints. Nonetheless, the Defendants have concluded that further conduct of the Litigation and the Federal Action would be protracted and expensive, and that it is desirable that the Litigation and the Federal Action be fully and finally settled in the manner and upon the terms and conditions set forth in the Stipulation. Defendants also have taken into account the costs inherent in any litigation, especially in complex cases like this Litigation and the Federal Action. The Defendants have, therefore, determined that it is desirable and beneficial to them that the Litigation and the Federal Action be settled in the manner and upon the terms and conditions set forth in the Stipulation. VI. TERMS OF THE PROPOSED SETTLEMENT The Defendants will pay into an escrow account, pursuant to the terms of the Stipulation of Settlement dated as of January 15, 2004 (the “Stipulation”), cash in the amount of $3.55 million which will earn interest for the benefit of the Settlement Class. Defendants also agree to pay an additional $2 million to the Settlement Class if the assets of ADAC are resold by Philips within two years of July 10, 2003 for more than Philips paid for them. A portion of the settlement proceeds will be used for certain administrative expenses, including costs of printing and mailing this Notice, the cost of publishing a newspaper notice, payment of any taxes assessed against the Settlement Fund and costs associated with the processing of claims submitted. The total amount of the Settlement Fund which can be spent for these purposes is limited pursuant to the terms of the Stipulation. In addition, as explained below, a portion of the Settlement Fund, plus an additional amount of up to $200,000 may be awarded by the Court to counsel for Representative Plaintiffs as attorneys’ fees and for reimbursement of out-of-pocket expenses. One or more of the Representative Plaintiffs may also seek an award from the Settlement Fund for their service on behalf of the Settlement Class. The balance of the Settlement Fund (the “Net Settlement Fund”) will be distributed according to the Plan of Allocation described below to Settlement Class Members who submit valid and timely Proof of Claim forms. VII. PLAN OF ALLOCATION The Net Settlement Fund will be distributed to Settlement Class Members who submit valid, timely Proof of Claim forms (“Authorized Claimants”) under the Plan of Allocation described below. The Plan of Allocation provides that you will be eligible to participate in the distribution of the Net Settlement Fund only if you do not request to be excluded from the Settlement Class. To the extent there are sufficient funds in the Net Settlement Fund, each Authorized Claimant will receive an amount equal to the Authorized Claimant’s claim, as defined below. If, however, the amount in the Net Settlement Fund is not sufficient to permit payment of the total claim of each Authorized Claimant, then each Authorized Claimant shall be paid the percentage of the Net Settlement Fund that each Authorized Claimant’s claim bears to the total of the claims of all Authorized Claimants. Payment in this manner shall be deemed conclusive against all Authorized Claimants.
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If the amount of the Net Settlement Fund is greater than the total claims of all Authorized Claimants the balance remaining shall be refunded to Defendants and/or their insurers. A claim will be calculated as follows: Following payment of all costs of notice and administration of the Settlement Fund, taxes and attorneys’ fees and expenses, the remainder will be divided equally among the shares eligible to recover to determine a per share amount to be distributed to Authorized Claimants. Each Authorized Claimant who makes a valid claim shall recover the per share amount multiplied by the number of shares the claimant sold. The parties have agreed that any disputes regarding the validity of claims shall be submitted to the Court for a binding determination. VIII. PARTICIPATION IN THE CLASS If you fall within the definition of the Settlement Class, you will be bound by any judgment entered with respect to the settlement in the Litigation and the Federal Action whether or not you file a Proof of Claim. If you choose, you may enter an appearance individually or through your own counsel at your own expense. TO PARTICIPATE IN THE DISTRIBUTION OF THE NET SETTLEMENT FUND, YOU MUST TIMELY COMPLETE AND RETURN THE PROOF OF CLAIM AND RELEASE FORM THAT ACCOMPANIES THIS NOTICE. The Proof of Claim and Release must be postmarked on or before May 4, 2004, and delivered to the Claims Administrator at the address below. Unless the Court orders otherwise, if you do not timely submit a valid Proof of Claim, you will be barred from receiving any payments from the Net Settlement Fund, but will in all other respects be bound by the provisions of the Stipulation and the Judgment. IX. EXCLUSION FROM THE CLASS You may request to be excluded from the Settlement Class. To do so, you must mail a written request to: ADAC Merger Litigation Claims Administrator c/o Gilardi & Co. LLC P.O. Box 8040 San Rafael, CA 94912-8040 The request for exclusion must state: (1) your name, address, and telephone number; (2) the number of shares of ADAC common stock sold in connection with the Tender Offer/Merger; and (3) that you wish to be excluded from the Settlement Class. TO BE VALID, A REQUEST FOR EXCLUSION MUST STATE ALL OF THE FOREGOING INFORMATION. YOUR EXCLUSION REQUEST MUST BE POSTMARKED ON OR BEFORE MARCH 10, 2004. If you submit a valid and timely request for exclusion, you shall have no rights under the settlement, shall not share in the distribution of the Net Settlement Fund, and shall not be bound by the Stipulation or the Judgment. X. DISMISSAL AND RELEASES If the proposed settlement is approved, the Court will enter a Final Judgment and Order of Dismissal with Prejudice (“Judgment”). The Judgment will dismiss the Released Claims with prejudice as to all Defendants. The Judgment will provide that all Settlement Class Members shall be deemed to have released and forever discharged all Released Claims (to the extent Members of the Settlement Class have such claims) against all Released Persons and that the Released Persons shall be deemed to have released and discharged all Settlement Class Members and counsel to the Representative Plaintiffs from all claims arising out of the prosecution and settlement of the Litigation, the Federal Action or the Released Claims. XI. APPLICATION FOR FEES, EXPENSES AND AWARDS At the Settlement Hearing, counsel for Representative Plaintiffs will request the Court to award attorneys’ fees of 28% of the Settlement Fund, plus expenses not to exceed $200,000. Plaintiffs’ Settlement Counsel will also seek an additional $200,000 in attorneys’ fees from ADAC, as agreed, in connection with ADAC’s agreement to pay $2,000,000 to the Settlement Class if the assets of ADAC are resold by Philips within two years of July 10, 2003 for more than Philips paid for them. Settlement Class Members are not personally liable for any such fees or expenses. One or more of the Representative Plaintiffs may also seek an award from the Settlement Fund not to exceed $7,500 for their service on behalf of the Settlement Class. To date, Representative Plaintiffs’ Counsel have not received any payment for their services in conducting this Litigation and the Federal Action on behalf of Representative Plaintiffs and the Members of the Settlement Class, nor have counsel been reimbursed for their substantial out-of-pocket expenses. The fee requested by Representative Plaintiffs’ Counsel will compensate counsel for their efforts in achieving the Settlement Fund for the benefit of the Settlement Class, and for their risk in undertaking this representation on a wholly contingent basis. Representative Plaintiffs’ Counsel represent that the fee requested is well within the range of fees awarded to plaintiffs’ counsel under similar circumstances in other litigation of this type.
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XII. CONDITIONS FOR SETTLEMENT The settlement is conditioned upon the occurrence of certain events described in the Stipulation. Those events include, among other things: (1) entry of the Judgment by the Court, as provided for in the Stipulation; and (2) expiration of the time to appeal from or alter or amend the Judgment. If, for any reason, any one of the conditions described in the Stipulation is not met, the Stipulation might be terminated and, if terminated, will become null and void, and the parties to the Stipulation will be restored to their respective positions as of July 10, 2003. XIII. THE RIGHT TO BE HEARD AT THE HEARING Any Settlement Class Member who objects to any aspect of the settlement, the Plan of Allocation, or the application for attorneys’ fees or costs, may appear and be heard at the Settlement Hearing. Any such Person must submit a written notice of objection, received on or before March 10, 2004, by each of the following:
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XV. EXAMINATION OF PAPERS This Notice is a summary and does not describe all of the details of the Stipulation. For full details of the matters discussed in this Notice, you may review the Stipulation filed with the Court, which may be inspected during business hours, at the office of the Clerk of the Court, Downtown Superior Court, 191 North First Street, San Jose, California.
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