On October 6, 2009, Judge Shira A. Scheindlin of the United States District Court for the Southern District of New York issued a 113-page decision in In re Initial Public Offering Sec. Litig., granting final approval to a $586 million class action settlement that comprehensively resolves all claims alleged in the largest securities proceedings in history, comprising 309 separate securities class action lawsuits against the issuers and underwriters of the subject initial public offerings. The Firm represented J.P. Morgan Securities Inc. ("JPMSI"), Hambrecht & Quist LLC, and ultimately Bear, Stearns & Co. Inc. after its merger with JPMSI in October 2008, as well as various predecessor entities.
The Firm took one of the leading roles in all aspects of the defense of this coordinated litigation, a proceeding of unprecedented scope, in which plaintiffs sought tens of millions of dollars in damages in each of the 309 separate lawsuits. This coordinated litigation has been actively litigated by the Firm for nearly eight years, and yielded in 2006 the most significant class certification decision of the decade. In addition to defeating class certification, one of the key defense achievements in the proceedings before the District Court was one spearheaded by Simpson Thacher, in which the Firm architected and successfully litigated a motion to strike the class allegations in eight cases, which reduced the Underwriter Defendants’ potential exposure in the cases by several hundred million dollars. In addition to the dismissal of the class allegations in eight cases, the Firm also obtained the only outright dismissal of an entire case in these coordinated actions, taking the lead in 2004 on behalf of all the defendants in demonstrating to the court that the case involving the Numerical Technologies, Inc. IPO was time-barred. Following a lengthy mediation before the Honorable Dan Weinstein and the Honorable Nicholas H. Politan, in which partners David W. Ichel and Joseph M. McLaughlin actively participated, the parties reached an agreement to resolve all 309 cases as against all defendants. The Firm played a leading role in the many months-long negotiation and drafting of the Stipulation of Settlement with representatives of the Plaintiffs’ Executive Committee, the Issuer Defendants and their scores of insurers, as well as the other Underwriter Defendants. The global settlement of $586 million, which the District Court granted final approval, represents only a fraction of the billions originally sought by the plaintiffs.
The litigation team representing JPMSI, H&Q, and Bear Stearns included David W. Ichel, Joseph M. McLaughlin, Jeffrey Coviello, and Susannah Geltman. A number of former STB associates had important roles, including Pamela Reichlin and Michelle Cherande. Invaluable paralegal assistance was provided by Rick Rosario.