Robbins Geller Rudman & Dowd LLP Announces Proposed Settlement in the In re LendingClub Securities Litigation

SAN FRANCISCO--()--The following statement is being issued by Robbins Geller Rudman & Dowd LLP regarding the In re LendingClub Securities Litigation:

 
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA
 
In re LENDINGCLUB SECURITIES LITIGATION )   Case No. 3:16-cv-02627-WHA
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CLASS ACTION

This Document Relates To:

) SUMMARY NOTICE

ALL ACTIONS.

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IF YOU PURCHASED OR ACQUIRED LENDINGCLUB CORPORATION (“LENDINGCLUB”) COMMON STOCK FROM DECEMBER 10, 2014, THROUGH MAY 6, 2016, INCLUSIVE, YOUR RIGHTS MAY BE AFFECTED BY A PROPOSED SETTLEMENT IN LAWSUITS PENDING IN FEDERAL AND STATE COURTS (THE “LITIGATIONS”). PLEASE READ CAREFULLY.

YOU ARE HEREBY NOTIFIED that a hearing will be held on July 19, 2018, at 8:00 a.m, before the Honorable William Alsup, United States District Judge, at the United States District Court for the Northern District of California (the “Court”), 450 Golden Gate Avenue, San Francisco, California, for the purpose of determining: (1) whether the proposed settlement in the Stipulation of Settlement, dated February 21, 2018 (“Stipulation”), of the Litigations for $125,000,000.00 in cash (the “Settlement Amount”) should be approved by the Court as fair, reasonable, and adequate; (2) whether a Judgment should be entered by the Court; (3) whether the Plan of Allocation is fair, reasonable, and adequate and should be approved; and (4) whether the applications by Federal and State Lead Counsel for attorneys’ fees and expenses should be approved.

The Litigations have been certified as class actions on behalf of all investors (individuals and entities) who purchased or acquired LendingClub common stock from December 11, 2014 through May 6, 2016, for claims under the Securities Exchange Act of 1934 (“Exchange Act”), and those who purchased or acquired LendingClub common stock during the period from December 10, 2014 through June 8, 2015, for claims under the Securities Act of 1933 (the “1933 Act”), and were damaged thereby (“Class Members”).1 A detailed description of the Litigations, including the parties, the claims and defenses, and other important information about your rights and options are in the detailed Notice of Pendency and Proposed Settlement of Class Action (“Notice”).

At the Settlement Hearing, Federal Lead Counsel and State Lead Counsel will request that the Court award aggregate attorneys’ fees for all counsel in both Litigations, according to the terms of the retainer agreement between Federal Lead Plaintiff and Federal Lead Counsel. These attorneys’ fees are estimated to amount to a combined $16,265,000 ($13,337,300 for Federal Lead Counsel, and $2,927,200 for all State Counsel), or approximately 13% of the Settlement Amount. Class Members are not personally liable for any such fees or any other expenses (estimated to be $650,000 for litigation expenses, and $1,250,000 for Notice and Administration Expenses). The net recovery for Class members (also referred to as the “Net Settlement Fund”) is estimated to be $106,835,000 ($125,000,000 minus all of the foregoing fees and expenses).

Federal Lead Counsel states that it has litigated this case on behalf of Federal Lead Plaintiff and the Class for over 20 months against 20 Defendants represented by four different firms. On behalf of Federal Lead Plaintiff, Federal Lead Counsel defeated four motions to dismiss the Complaint; prevailed against six law firms to obtain class certification; succeeded in eliminating 115 of Defendants’ combined 154 affirmative defenses; litigated multiple discovery motions, leading to over 1 million pages of additional evidence for the Class, and, in lieu of still more documents, obtained an order allowing Federal Lead Counsel to argue at trial that the Underwriter Defendants could have waived the attorney-client privilege as to thousands of withheld documents but chose not to, and that parts of the story concealed under these privilege claims would have been unfavorable to the Underwriter Defendants. Federal Lead Counsel obtained and analyzed over 3.2 million pages of documents from Defendants and over 500,000 pages of documents from third parties. Additionally, Federal Lead Counsel oversaw Federal Lead Plaintiff’s production to Defendants of over 240,000 pages of documents, and defended Federal Lead Plaintiff’s representative’s deposition. Federal Lead Counsel deposed two defendants (Gerald Walters of Wells Fargo Securities, LLC, and James Hoak of William Blair & Co., L.L.C.) and, at the time this settlement was reached, had scheduled, formed teams to prepare, and was preparing to take 20 additional fact witness depositions (e.g., February 22, 2018 for third-party Colchis Capital; March 14, 2018 for defendant Carrie Dolan; April 13, 2018 for third-party Deloitte & Touche). Pursuant to Federal Lead Plaintiff’s retainer agreement with Federal Lead Counsel, which the Court reviewed prior to appointing Federal Lead Counsel, Federal Lead Counsel will not receive any compensation for any of its time, and no reimbursement for any of its expenses, absent a recovery for Federal Lead Plaintiff and the Class.

State Lead Counsel states that it has also conducted extensive work on behalf of those Class members with claims under the 1933 Act over the last two years. This work has included, among other things, conducting a pre-suit investigation; filing the initial complaint against all 20 Defendants on February 26, 2016 (in the State Court); defeating Defendants’ motion to stay the State Action in its entirety; conducting extensive discovery of Defendants and ultimately obtaining (and subsequently reviewing) over 700,000 pages of documents pursuant to those requests and related discovery negotiations and Court-supervised discovery conferences; defeating five separate demurrers (motions to dismiss) to State Plaintiffs’ complaints; successfully obtaining class certification from the State Court, over Defendants’ opposition, of a class (consisting of all Class members with 1933 Act claims) in June 2017; and participated in numerous case management conferences, discovery conferences, and ex parte hearings before the State Court. State Lead Counsel also participated (with Federal Lead Counsel) in the depositions of multiple Underwriter Defendants and, at the time this settlement was reached, had also prepared to depose various third party witnesses as well as “persons most qualified” representatives of LendingClub on topics that State Lead Counsel had designated pursuant to Cal. Civ. Pro 2520.230). State Lead Counsel also managed the three State Class Representatives’ responses to Defendants’ discovery requests, and defended each of their depositions. State Lead Counsel were also full participants in the Settlement Conferences and mediation process with Judge Spero that resulted in the proposed settlement, and thereafter represented (in consultation with their damages expert) the interests of Class members with 1933 Act claims in connection with formulating the proposed Plan of Allocation. Like Federal Lead Counsel, State Lead Counsel’s ability to recover any attorneys’ fees or reimbursement of its expenses has at all times been fully contingent upon a successful recovery on behalf of the Class.

To obtain the Notice or a copy of the Proof of Claim and Release form (“Proof of Claim and Release”), visit the settlement website at www.LendingClubSecuritiesClassAction.com or write to LendingClub Securities Litigation, Claims Administrator, c/o Gilardi & Co. LLC, P.O. Box 404041, Louisville, KY 40233-4041.

To get a payment from the Net Settlement Fund, you must submit a Proof of Claim and Release by mail postmarked no later than June 25, 2018, or electronically no later than June 25, 2018, establishing that you are entitled to recovery. Failure to submit your Proof of Claim and Release by June 25, 2018, will subject your claim to possible rejection and may preclude you from receiving any payment from the settlement. If you are a Class Member and do not exclude yourself by the deadline, you will be bound by the settlement and any judgment entered in the Litigations, whether or not you submit a Proof of Claim and Release.

To be excluded from the settlement, you must submit a written request for exclusion in accordance with all the instructions in the Notice such that it is received no later than June 25, 2018. All Class Members who do not timely exclude themselves will be bound by the settlement (assuming it is approved by the Court) even if they do not submit a timely Proof of Claim and Release.

To object to any aspect of the settlement, including the Plan of Allocation, or the application for attorneys’ fees and expenses, you must submit a written objection in accordance with all the instructions set forth in the Notice no later than June 25, 2018. If you object, but also want to be eligible for a payment from the settlement, you must still submit a timely Proof of Claim and Release.

PLEASE DO NOT CONTACT THE COURT OR THE CLERK’S OFFICE REGARDING THIS NOTICE. If you have any questions about the settlement, you may contact Federal and State Lead Counsel at the following addresses:

 

Lead Counsel in the Federal Litigation:

Lead Counsel in the State Litigation:

ROBBINS GELLER RUDMAN SCOTT+SCOTT,
& DOWD LLP ATTORNEYS AT LAW, LLP
Theodore J. Pintar William C. Fredericks
655 West Broadway, Suite 1900 230 Park Avenue, 17th Floor
San Diego, CA 92101 New York, NY 10169

TedP@rgrdlaw.com

or
COTCHETT, PITRE & MCCARTHY, LLP
Mark C. Molumphy
San Francisco Airport Office Center
840 Malcolm Road, Suite 200
Burlingame, CA 94010
 
DATED: March 26, 2018 BY ORDER OF THE COURT
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF CALIFORNIA

1 All capitalized terms used herein that are not otherwise defined shall have the meanings provided in the Stipulation, which is available on the settlement website, www.LendingClubSecuritiesClassAction.com.

Contacts

Robbins Geller Rudman & Dowd LLP
Ted Pintar, 619-231-1058

Contacts

Robbins Geller Rudman & Dowd LLP
Ted Pintar, 619-231-1058