Frias v. Dendreon Corp.
2011 U.S. Dist. LEXIS 145762
W.D. Wash.2011Background
- This court considered two motions for lead plaintiff and lead counsel in consolidated Dendreon securities actions (SamCERA and the Frankel Investor Group).
- Motions pertain to lead plaintiff and lead counsel in Nos. C 11-1291 JLR, C 11-1294 JLR, and C 11-1568 JLR, now consolidated under Master Docket C 11-1291 JLR.
- SamCERA seeks lead plaintiff and Bernstein Litowitz as lead counsel with Keller Rohrback as liaison; Frankel seeks two firms as co-lead counsel.
- Frankel Group comprises seven unrelated individuals introduced via counsel; concerns raised about cohesion, control by lawyers, and potential deadlock.
- The court held SamCERA has the greatest individual financial stake and approved SamCERA as lead plaintiff and Bernstein Litowitz as lead counsel, denying Frankel’s motion; court also ordered joint status report and schedule for consolidated amended complaint.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Should Frankel aggregate losses to have the largest financial stake? | Frankel argues group can aggregate losses to exceed others. | SamCERA argues losses must be considered individually; aggregation risks lawyer-driven control. | Losses should be considered individually; SamCERA is presumptive lead plaintiff. |
| Whether SamCERA satisfies Rule 23 adequacy and typicality | SamCERA claims typicality and adequacy with class. | No counterpoint challenging SamCERA's adequacy/typicality was sustained. | SamCERA satisfies typicality and adequacy; appointed lead plaintiff. |
| Approval of lead counsel and liaison counsel | SamCERA selected Bernstein Litowitz and Keller Rohrback; no objections. | Not raised; no opposing arguments documented. | Bernstein Litowitz appointed as lead counsel; Keller Rohrback as liaison. |
Key Cases Cited
- In re Cavanaugh, 306 F.3d 726 (9th Cir. 2002) (presumption of adequacy based on largest financial interest and Rule 23 alignment)
- Armour v. Network Assoc., Inc., 171 F.Supp.2d 1044 (N.D. Cal. 2001) (institutional investors as ideal lead plaintiffs; adequacy considerations)
- In re Network Associates, Inc. Sec. Litig., 76 F.Supp.2d 1017 (N.D. Cal. 1999) (discusses factors for lead plaintiff adequacy and financial stake)