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Booth v. Strategic Realty Trust, Inc.

United States District Court, Ninth Circuit

January 27, 2014

LEWIS BOOTH, et al., Plaintiffs,
v.
STRATEGIC REALTY TRUST, INC., et al., Defendants.

ORDER GRANTING MOTION FOR APPOINTMENT OF LEAD PLAINTIFFS AND APPROVAL OF SELECTION OF COUNSEL Re: ECF No. 11

JON S. TIGAR, District Judge.

I. INTRODUCTION

In this securities action, Plaintiffs Lewis Booth and Stephen Drews ("Movants") have moved for an order appointing them as Lead Plaintiffs, and approving their selection of Girard Gibbs LLP ("Girard Gibbs") to serve as Lead Counsel. ECF No. 11. The motion is unopposed. Pursuant to Rule 78(b) of the Federal Rules of Civil Procedure and Civil Local Rule 7-1(b), the Court finds that the briefs have thoroughly addressed the issues, rendering the matter suitable for disposition without oral argument. The hearing on this matter, currently scheduled for February 6, 2014 is hereby VACATED.

II. BACKGROUND

A. Factual and Procedural History

On October 23, 2013, Movants filed a proposed class action complaint against Defendants Strategic Realty Trust, Inc. ("SRT"), Thompson National Properties, LLC, TNP Strategic Retail Advisor, LLC, TNP Securities, LLC, and numerous individual officers and directors of SRT (collectively, "Defendants"). Complaint for Violations of the Federal Securities Laws ("Complaint"), ECF No. 1. Movants seek to represent a class of SRT common stock purchasers in bringing an action against Defendants for violations of Sections 11, 12(a)(2) and 15 of the Securities Act of 1933, 15 U.S.C. §§ 77k, 77l(a)(2), 77p. Complaint ¶¶ 88, 94-136.

Movants filed this motion for Appoinement as Lead Plaintiffs and Approval of Selection of Counsel on December 23, 2013. Defendants have filed statements of nonopposition. ECF Nos. 14 & 15.

B. Jurisdiction

Since the Movants' complaint brings claims under the Securities Act of 1933, this Court has jurisdiction pursuant to Section 18 of the Securities Act, 15 U.S.C. § 77v, as well as pursuant to 28 U.S.C. § 1331.

C. Legal Standards

1. Designation of Lead Plaintiff

"[T]he Ninth Circuit [has] laid out a three-step process for identifying the lead plaintiff pursuant to the statutory criteria" of the Private Securities Litigation Reform Act ("PSLRA"). In re Copper Mountain Sec. Litig. , 305 F.Supp.2d 1124, 1129 (N.D. Cal. 2004) (citing In re Cavanaugh , 306 F.3d 726, 729-31 (9th Cir. 2002).[1] "The first step consists of publicizing the pendency of the action, the claims made and the purported class period." Cavanaugh , 306 F.3d at 726. "In step two, the district court must consider the losses allegedly suffered by the various plaintiffs before selecting as the presumptively most adequate plaintiff' - and hence the presumptive lead plaintiff - the one who has the largest financial interest in the relief sought by the class' and otherwise satisfies the requirements of Rule 23 of the Federal Rules of Civil Procedure.'" Id. at 729-30 (quoting 15 U.S.C. § 78u-4(a)(3)(B)(iii)(I)). "The third step of the process is to give other plaintiffs an opportunity to rebut the presumptive lead plaintiff's showing that it satisfies Rule 23's typicality and adequacy requirements." Cavanaugh , 306 F.3d at 730.

2. Selection of Counsel

"The most adequate plaintiff shall, subject to the approval of the court, select and retain counsel to represent the class." 15 U.S.C. § 77z-1(a)(3)(B)(v). "[T]he district court should not reject a lead plaintiff's proposed counsel merely because it would have chosen differently." Cohen v. U.S. Dist. Court for N. Dist. of California , 586 F.3d 703, 711-12 (9th Cir. 2009) (citing Cavanaugh , 306 F.3d at 732, 734 & n. 14. "[I]f the lead plaintiff has made a reasonable choice of counsel, the district court should generally defer to that choice." Cohen , 586 F.3d at 712; see also id. (approvingly citing In re Cendant Corp. Litig. , 264 F.3d 201, 276 (3d Cir. 2001), in which the Third Circuit "enumerate[d] factors to consider in conducting this inquiry, including the lead plaintiff's sophistication and experience, the process through which the ...


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