UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA SAN FRANCISCO DIVISION
September 13, 2010
IN RE CHARLES SCHWAB CORP. SECURITIES LITIGATION
The opinion of the court was delivered by: The Honorable William Alsup United States District Judge
THIS DOCUMENT RELATES TO: All Actions [PROPOSED] ORDER AMENDING PROPOSED SETTLEMENTS AND DIRECTING THAT SETTLEMENT NOTICE BE PROVIDED TO INTERMEDIARY ACCOUNT CLASS MEMBERS Date Action Filed: March 18, 2008
Before the Court is the parties' Joint Administrative Motion to Modify Settlement (the "Motion") pertaining to "Intermediary Accounts" that held YieldPlus Fund shares at broker-dealer intermediaries other than Charles Schwab & Co., Inc. Although Intermediary Account holders are members of the Classes as defined in this class action, neither the initial notice of pendency nor the recent notice of the proposed settlement were provided to the Intermediary Accounts holders. and E to the Motion.
a notice to all broker-dealer intermediaries identified in the Intermediary Account data provided by Schwab. This notice will request that, for all accounts that held YieldPlus Fund shares at any time from May 31, 2006 through and including March 17, 2008, the broker-dealer intermediary provide names, addresses and all YieldPlus Fund transaction data. The notice will inform the broker- dealers that, if it is not feasible to provide the YieldPlus Fund transaction data by October 1, 2010, the broker-dealer intermediaries still must provide name and address information so that that proof of claim forms may be sent to investors who held YieldPlus Fund shares in accounts with that broker-dealer. The Court directs the broker-dealer intermediaries to promptly provide this information so that the Intermediary Account holders may benefit from the proposed settlements.
Intermediary Account holders who have allowed losses. Where the Settlement Administrator is unable to obtain transaction data from the broker-dealer intermediary, the Settlement Adminstrator is to send a proof of claim form to the investors who held YieldPlus Fund shares in Intermediary Stipulation of Settlement (Federal) and Exhibit B to Amendment No. 1 to Stipulation of Settlement Federal Rule of Civil Procedure and due process and is the best notice practicable under the circumstances and constitutes due and sufficient notice.
The Court hereby grants the Motion and orders that the following occur:
1. The parties are directed to execute the proposed amendments attached as Exhibits D
2. Within seven (7) days of this Order, the Settlement Administrator is directed to send
3. After receiving the necessary data from the broker-dealer intermediaries, the Settlement Administrator is to provide individual notice of the proposed settlement by U.S. Mail to 21 Accounts. The notice will be in the forms attached as Exhibit B to Amendment No. 4 to (California). The Court finds that this form and method of notice meets the requirements of
4. Intermediary Account holders shall have at least 45 days from the date on which the Intermediary Accounts Notice is sent to them in which to (i) provide the Settlement Administrator with notice that he or she is opting out of the class, (ii) submit any objection to the settlement, or (iii) where applicable, submit a proof of claim. Where the Settlement Administrator has or obtains the necessary transaction data to determine allowed losses for a particular Intermediary Account holder, the Intermediary Account holder will not be required to complete a proof of claim.
Otherwise, the Intermediary Accounts holder must complete a proof of claim in the form attached to the notice and provide supporting documentation.
5. Schwab is directed to contribute an additional $2,762,136.61 to the Settlement Fund for the Federal Classes, and $17,295.91 to the Settlement Fund for the California Class. As described in the Declaration of Candace L. Preston Regarding Intermediary Accounts, these amounts are intended to provide the class members in the Intermediary Accounts the same pro rata recovery as other class members. The Court preliminarily approves the distribution plans set forth in Amendment No. 4 to Stipulation of Settlement (Federal) and Amendment No. 1 to Stipulation of Settlement (California).
6. Final approval hearing. A hearing to consider any objections filed by any class member in the Intermediary Accounts is scheduled for December __, 2010 at __ a.m./p.m.
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