MICHAEL R. NEWHOUSE (SBN 211204) RUTH L. SEROUSSI (SBN...
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Case No. SACV 10-00401 AG (MLGx) Page 1 STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION SETTLEMENT AGREEMENT 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MICHAEL R. NEWHOUSE (SBN 211204) [email protected] RUTH L. SEROUSSI (SBN 182623) [email protected] SUZANNE M. HENRY (SBN 204772) [email protected] NEWHOUSE|SEROUSSI Attorneys, PC 1800 Century Park East, 6 th Floor Los Angeles, California 90067 Telephone: (310) 684-3162 Facsimile: (310) 496-0551 J. MARK MOORE (SBN 180473) [email protected] IRA SPIRO (SBN 67641) [email protected] H. SCOTT LEVIANT (SBN 200834) [email protected] SPIRO MOORE LLP 11377 W. Olympic Blvd., 5th Floor Los Angeles, California 90064-1683 Telephone: (310) 235-2468 Facsimile: (310) 235-2456 Attorneys for Plaintiffs and the Class UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA BRADLEY B. LARSEN, as Trustee of the BRAD AND CINDY LARSEN LOVING TRUST, et al., Plaintiffs, vs. COLDWELL BANKER REAL ESTATE CORPORATION, a California corporation, doing business as COLDWELL BANKER COMMERCIAL AFFILIATES, INC., et al. Defendants. Case No. SACV 10-00401 AG (MLGx) CLASS ACTION STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION SETTLEMENT AGREEMENT Date Action Filed: April 2, 2010 Trial Date: Vacated
Transcript of MICHAEL R. NEWHOUSE (SBN 211204) RUTH L. SEROUSSI (SBN...
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MICHAEL R. NEWHOUSE (SBN 211204) [email protected] RUTH L. SEROUSSI (SBN 182623) [email protected] SUZANNE M. HENRY (SBN 204772) [email protected] NEWHOUSE|SEROUSSI Attorneys, PC 1800 Century Park East, 6th Floor Los Angeles, California 90067 Telephone: (310) 684-3162 Facsimile: (310) 496-0551 J. MARK MOORE (SBN 180473) [email protected] IRA SPIRO (SBN 67641) [email protected] H. SCOTT LEVIANT (SBN 200834) [email protected] SPIRO MOORE LLP 11377 W. Olympic Blvd., 5th Floor Los Angeles, California 90064-1683 Telephone: (310) 235-2468 Facsimile: (310) 235-2456 Attorneys for Plaintiffs and the Class
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA
BRADLEY B. LARSEN, as Trustee ofthe BRAD AND CINDY LARSEN LOVING TRUST, et al., Plaintiffs, vs. COLDWELL BANKER REAL ESTATE CORPORATION, a California corporation, doing business as COLDWELL BANKER COMMERCIAL AFFILIATES, INC., et al. Defendants.
Case No. SACV 10-00401 AG (MLGx) CLASS ACTION STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION SETTLEMENT AGREEMENT Date Action Filed: April 2, 2010 Trial Date: Vacated
Case No. SACV 10-00401 AG (MLGx) Page 2 STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION SETTLEMENT
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STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION
SETTLEMENT AGREEMENT
IT IS HEREBY STIPULATED, by and between Plaintiffs Bradley B. Larsen,
as Trustee of the Brad and Cindy Larsen Loving Trust; Jimmy R. Bunch, Jr.;
Stephen J. Woodward; Sun Holdings, LLC; and Daniel Todd, on behalf of
themselves and the Settlement Class Members, on the one hand, and Defendants
COLDWELL BANKER REAL ESTATE CORPORATION, a California
corporation, doing business as COLDWELL BANKER COMMERCIAL
AFFILIATES, INC. and COLDWELL BANKER REAL ESTATE, LLC, on the
other hand, and subject to the approval of the Court, that the Action is hereby being
compromised and settled pursuant to the terms and conditions set forth in this
Stipulation of Class Action Settlement and Class Action Settlement Agreement and
that the Court shall make and enter judgment, subject to the continuing jurisdiction
of the Court as set forth below, subject to the definitions, recitals and terms set
forth herein which by this reference become an integral part of this Agreement:
I. DEFINITIONS
1. “Agreement” means this Stipulation of Class Action Settlement and
Class Action Settlement Agreement
2. “Action” means Larsen, et al v. Coldwell Banker Real Estate
Corporation, et al., filed on April 2, 2010, in the United States District Court for
the Central District of California, case no. SACV 10-00401 AG (MLGx).
3. “CB/REP” means Coldwell Banker Commercial REP, Coldwell
Banker Commercial American Spectrum, Orange Coast Commercial Inc., and their
respective employees, agents, affiliates, subsidiaries and other related parties.
4. “Class Counsel” means Spiro Moore LLP (formerly Spiro Moss LLP),
and all partners, attorneys, and all other current or former employees of that law
firm, and NEWHOUSE|SEROUSSI, Attorneys, PC, and all partners, attorneys, and
all other current or former employees of that law firm.
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5. “Class Counsel Award” means attorneys’ fees for Class Counsel’s
litigation and resolution of this Action and their expenses and costs incurred in
connection with the Action, paid from the Gross Settlement Fund.
6. “Class Information” means information regarding Settlement Class
Members that will be provided to the Settlement Administrator. To the extent
practicable it shall be formatted as a Microsoft Excel spreadsheet and shall include:
each Settlement Class Member’s full name, last known address, last known home
telephone number, and total amount invested in the Investment Funds.
7. “Class Representative Service Award” means the amount that the
Court authorizes to be paid to Plaintiffs, in addition to their Individual Settlement
Payment, in recognition of their efforts and risks in assisting with the prosecution
of the Action.
8. “Court” means the United States District Court, Central District of
California.
9. “Defendants” means COLDWELL BANKER REAL ESTATE
CORPORATION, a California corporation, doing business as COLDWELL
BANKER COMMERCIAL AFFILIATES, INC. and COLDWELL BANKER
REAL ESTATE, LLC.
10. “Defense Counsel” means SKADDEN, ARPS, SLATE, MEAGHER &
FLOM LLP, and all partners, attorneys, and all other current or former employees
of that law firm.
11. “Effective Date” means the date upon which the Court grants final
approval of the Settlement if (a) no Settlement Class Members file objections to the
Settlement, or (b) any Settlement Class Member files an objection but it is
subsequently withdrawn by the date upon which final approval is granted. If an
objection is filed and no appeal or other appellate proceeding is initiated, the
Effective Date shall be thirty days after the Court grants final approval of the
Settlement. If an objection is filed and an appeal or other appellate proceeding is
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initiated, the Effective Date shall be the date of termination of such appellate
proceedings.
12. “Gross Settlement Fund” means $9,250,000.
13. “Individual Settlement Payment” means the amount payable from the
Net Settlement Amount to each Settlement Class Member.
14. “Joint Equity Committee” means the Joint Equity Committee of
Investors of Real Estate Partners, Inc. and its Related Entities as that Committee
was and is designated in the United States Bankruptcy Court for the Central District
of California Case No. 8:07-bk-13239-TA.
15. “Net Settlement Amount” means the Gross Settlement Fund, less
reimbursements to the REP Bankruptcy Estate (United States Bankruptcy Court for
the Central District of California Case No. 8:07-bk-13239-TA) for fees and costs
previously paid (if any), Class Counsel Award, Class Representative Service
Awards, and Settlement Administrator Costs.
16. “Notice Packet” means the Notice of Proposed Class Action
Settlement (substantially in the form attached as Exhibit 1).
17. “Order and Final Judgment” means the proposed order to be entered
providing final approval of the Settlement (substantially in the form attached as
Exhibit 2).
18. “Parties” means Plaintiffs and Defendants, collectively, and “Party”
shall mean either Plaintiffs or Defendants, individually.
19. “Payment Ratio” means, for each respective Settlement Class Member,
the amount calculated by dividing the total amount invested for each respective
Settlement Class Member by the total of all amounts invested in all of the Invested
Funds for all Settlement Class Members.
20. “Plaintiffs” means Bradley B. Larsen, as Trustee of the Brad and
Cindy Larsen Loving Trust; Jimmy R. Bunch, Jr.; Stephen J. Woodward; Sun
Holdings, LLC; and Daniel Todd.
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21. “Preliminary Approval Order” means the proposed order to be entered
preliminarily approving the Settlement (substantially in the form attached as
Exhibit 3).
22. “Released Claims” means any and all claims, damages, causes of
action, disputes, demands, liens, actions, suits, obligations, controversies, debts,
costs, attorneys' fees, expenses, judgments, orders, equitable remedies and
liabilities whatsoever, of every nature and description, pleaded in, arising from,
based upon, connected with, or otherwise related to, the facts pleaded and
allegations of wrongdoing in the Second Amended Complaint or other prior
operative complaint or related to conduct by (1) Released Parties, related to, arising
from, or connected with any and all activity by REP and/or CB REP, (2) REP, or
(3) CB REP, whether sought under federal, state or local law, statutory, common or
equity law, regulation, tort, contract, or as an unfair business practice, including
both known claims and unknown claims, foreseen claims and unforeseen claims,
class or individual in nature, as well as all claims that have been or could have been
plead or asserted in any forum by the Plaintiffs and Settlement Class Members
against the Released Parties, whether directly, indirectly, representatively or in any
other capacity.
23. “Released Parties” means Defendants, their predecessors, successors,
current and former parents, subsidiaries, and related entities, as well as their present
and former partners, officers, directors, employees who are not Settlement Class
Members, consultants, insurers, shareholders, accountants, auditors, associates,
agents, and attorneys.
24. “REP” means Real Estate Partners, Inc. and the REP Investment
Funds.
25. REP Investment Funds include any of “INCOME FUND I”;
“INCOME FUND II”; “INCOME FUND III”; “UNIT INVESTMENT BUSINESS
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TRUST I”’ “UNIT INVESTMENT BUSINESS TRUST II”; “EQUITY FUND”;
and/or the “GROWTH FUND.”
26. “Response Deadline” means the date 60 days after the Settlement
Administrator mails Notice Packets to Settlement Class Members and the last date
on which Settlement Class Members may submit a request for exclusion, or
objection to the Settlement. The Response Deadline may be extended up to 15
days for any Class Member that receives a re-mailed Notice Packet.
27. “Settlement” means the disposition of the Action pursuant to this
Agreement.
28. “Settlement Administration Costs” means the amount to be paid to the
Settlement Administrator from the Gross Settlement Fund for administration of this
Settlement.
29. “Settlement Administrator” means Kurtzman Carson Consultants LLC.
30. “Settlement Class Members” means all persons and entities that paid
money to invest in any of the REP Investment Funds. Excluded from the Class are
the named Defendants, as well as REP, CB/REP, and all of their current and former
officers, directors, management employees, successors, and wholly or partly owned
subsidiaries or affiliated companies; Class Counsel and their employees and
members; all persons within the third degree of relationship to any of them and any
judge who hears or decides any matter in this litigation. The “Settlement Class
Members” shall not include any person who submits a timely and valid request for
exclusion as provided in this Agreement.
II. RECITALS
31. Class Certification. On March 26, 2012, the Court certified this
Action. Defendants stipulate and agree that they will not contest that certification
Order for purposes of this Settlement only. Should the Settlement not become final
and effective as herein provided, the parties will return to their respective positions
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in the litigation immediately prior to the time the parties entered into this
Settlement Agreement and Defendants will retain whatever rights Defendants
possess to contest class certification through procedurally authorized means,
including the right to request that the Ninth Circuit resume evaluation of
Defendants’ previously filed Fed. R. Civ. P. 26(f) Petition. The Parties’
willingness to resolve this matter through this Settlement shall have no bearing on,
and shall not be admissible in or considered in connection with, the issue of
whether a class should be certified in any other lawsuit.
32. Procedural History. On April 2, 2010, the Joint Equity Committee
filed this action. After this Court determined that the Joint Equity Committee
lacked standing to pursue this matter on behalf of the Class, Plaintiffs filed a First
Amended Complaint alleging a putative class action. The Court dismissed the First
Amended Complaint without prejudice. On March 29, 2011, Plaintiffs filed a
Second Amended Class Action Complaint alleging claims for negligence, fraud,
negligent misrepresentation, unfair business practices pursuant to California
Business & Professions Code sections 17200, et seq., false advertising pursuant to
California Business & Professions Code sections 17500, et seq., and aiding and
abetting along with claims for interest, punitive damages and costs. The Court
granted Defendants' motion to dismiss the section 17200 claim, but denied the
remainder of the motion. Defendants answered on September 22, 2011. On March
26, 2012, the Court certified the matter as a class action in part. On May 15, 2012
and again on June 5, 2012, the Parties participated in private mediation after they
engaged in extensive formal discovery (including multiple sets of requests for
production of documents and interrogatories), pursued additional discovery through
multiple motions to compel, completed the depositions of Defendants’ designated
corporate representative, completed the depositions of seven current or former
employees of Defendants or their related entities, and completed the depositions of
all Plaintiffs and 13 Class Members. At the June 5, 2012 mediation, the Parties
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came to agreement on the material terms for this Settlement. Thereafter, the Parties
came to agreement on the additional terms for this Settlement as set forth herein.
33. Benefits of Settlement to Class Members. Plaintiffs and Class Counsel
recognize the expense and length of continued proceedings necessary to litigate
their disputes through trial and through any possible appeals. Plaintiffs have also
taken into account the uncertainty and risk of the outcome of further litigation, and
the difficulties and delays inherent in such litigation. Plaintiffs and Class Counsel
are also aware of the burdens of proof necessary to establish liability for the claims
asserted in the Action, both generally and in response to Defendants’ defenses
thereto. Plaintiffs and Class Counsel have also taken into account the extensive
settlement negotiations conducted. Based on the foregoing, Plaintiffs and Class
Counsel have determined that the Settlement set forth in this Agreement is a fair,
adequate and reasonable settlement, and is in the best interests of the Settlement
Class Members.
34. Defendant’s Reasons for Settlement. Defendants have concluded that
any further defense of this litigation would be protracted and expensive for all
Parties. Substantial amounts of time and resources of Defendants have been and,
unless this Settlement is made, will continue to be devoted to the defense of the
claims asserted by Plaintiffs and Settlement Class Members. Defendants have also
taken into account the risks of further litigation in reaching their decision to enter
into this Settlement. Despite continuing to contend that they are not liable for any
of the claims set forth by Plaintiffs, Defendants have, nonetheless, agreed to settle
in the manner and upon the terms set forth in this Agreement to put to rest the
claims as set forth in the Action. Defendants have claimed and continue to claim
that the Released Claims have no merit and do not give rise to liability. This
Agreement is a compromise of disputed claims. Nothing contained in this
Agreement and no documents referred to herein and no action taken to carry out
this Agreement may be construed or used as an admission by or against Defendants
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as to the merits or lack thereof of the claims asserted. The monies being paid as
part of the settlement are genuinely disputed.
35. Settlement Class Members’ Claims. Settlement Class Members have
claimed and continue to claim that the Released Claims have merit and give rise to
liability on the part of Defendants. This Agreement is a compromise of disputed
claims. Nothing contained in this Agreement and no documents referred to herein
and no action taken to carry out this Agreement may be construed or used as an
admission by or against the Settlement Class Members or Class Counsel as to the
merits or lack thereof of the claims asserted.
III. TERMS OF AGREEMENT
36. Release As To All Class Members. As of the Effective Date, in
exchange for the Gross Settlement Fund, Plaintiffs, and the Settlement Class
Members and the Joint Equity Committee release the Released Parties from the
Released Claims. With respect to the Released Claims, Plaintiffs, the Settlement
Class Members, and the Joint Equity Committee stipulate and agree that, upon the
Effective Date, Plaintiffs, the Settlement Class Members, and the Joint Equity
Committee shall be deemed to have, and by operation of the final judgment shall
have, expressly waived and relinquished, to the fullest extent permitted by law, the
provisions, rights and benefits of Section 1542 of the California Civil Code, or any
other similar provision under federal or state law, which Section provides:
A general release does not extend to claims which the creditor does not
know or suspect to exist in his or her favor at the time of executing the
release, which if known by him or her must have materially affected
his or her settlement with the debtor.
Plaintiffs, the Settlement Class Members, and the Joint Equity Committee may
hereafter discover facts in addition to or different from those they now know or
believe to be true with respect to the subject matter of the Released Claims, but
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upon the Effective Date, shall be deemed to have, and by operation of the final
judgment shall have, fully, finally, and forever settled and released any and all of
the Released Claims, whether known or unknown, suspected or unsuspected,
contingent or non-contingent, which now exist, or heretofore have existed, upon
any theory of law or equity now existing or coming into existence in the future,
including, but not limited to, conduct that is negligent, intentional, with or without
malice, or a breach of any duty, law or rule, without regard to the subsequent
discovery or existence of such different or additional facts.
37. Tax Liability. The Parties make no representations as to the tax
treatment or legal effect of the payments called for hereunder, and Settlement Class
Members are not relying on any statement or representation by the Parties in this
regard. Settlement Class Members understand and agree that they will be
responsible for the payment of any taxes and penalties assessed on the payments
described herein and will hold the Parties free and harmless from and against any
claims, liabilities, costs and expenses, including attorney’s fees, resulting in any
way from personal tax treatment of the payments made pursuant to this Agreement,
including the treatment of such payments as not subject to withholding or
deduction.
38. Circular 230 Disclaimer. Each Party to this Agreement (for purposes
of this section, the “acknowledging party” and each Party to this Agreement other
than the acknowledging party, an “other party”) acknowledges and agrees that:
(1) no provision of this Agreement, and no written communication or disclosure
between or among the Parties or their attorneys and other advisers, is or was
intended to be, nor shall any such communication or disclosure constitute or be
construed or be relied upon as, tax advice within the meaning of United States
Treasury Department circular 230 (31 CFR part 10, as amended); (2) the
acknowledging party (a) has relied exclusively upon his, her or its own,
independent legal and tax counsel for advice (including tax advice) in connection
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with this Agreement, (b) has not entered into this Agreement based upon the
recommendation of any other Party or any attorney or advisor to any other Party,
and (c) is not entitled to rely upon any communication or disclosure by any
attorney or adviser to any other party to avoid any tax penalty that may be imposed
on the acknowledging party, and (3) no attorney or adviser to any other Party has
imposed any limitation that protects the confidentiality of any such attorney’s or
adviser’s tax strategies (regardless of whether such limitation is legally binding)
upon disclosure by the acknowledging party of the tax treatment or tax structure of
any transaction, including any transaction contemplated by this Agreement.
39. Submission of the Settlement to Court for Approval. By July 30,
2012, Plaintiffs shall apply to the Court by motion on notice for entry of a
Preliminary Approval Order in the form annexed hereto as Exhibit 3. This
Preliminary Approval Order shall include a schedule which, inter alia (a) sets dates
for the Final Approval/Settlement Fairness Hearing to be held by the Court to
consider and determine whether the Settlement should be approved as fair,
reasonable and adequate and whether the Order and Final Judgment, in the form
attached hereto as Exhibit 2 should be entered; (b) provides that pending final
determination of whether the Settlement contained herein should be approved,
neither Plaintiffs nor any Settlement Class Member, either directly,
representatively, individually, derivatively or in any other capacity shall
commence, continue or prosecute any action or proceeding in any court or tribunal
asserting any claims which have been or could have been asserted, or which arise
out of or relate in any way to the Released Claims against any of the Released
Parties; and (c) approves the Notice Packet, in the form attached as Exhibit 1.
40. Settlement Administration. Within seven calendar days after the Court
grants preliminary approval of this Agreement, Plaintiffs shall provide the
Settlement Administrator with the Class Information for purposes of mailing Notice
Packets to Settlement Class Members.
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(a) Notice By First Class U.S. Mail. Upon receipt of the Class
Information, the Settlement Administrator will perform a search
based on the National Change of Address Database to update
and correct any known or identifiable address changes. Within
14 calendar days after receiving the Class Information from
Plaintiffs as provided herein, the Settlement Administrator shall
mail copies of the Notice Packet to all Settlement Class
Members via regular First Class U.S. Mail. The Settlement
Administrator shall exercise its best judgment to determine the
current mailing address for each Settlement Class Member. The
address identified by the Settlement Administrator as the current
mailing address shall be presumed to be the best mailing address
for each Settlement Class Member.
(b) Undeliverable Notices. Any Notice Packets returned to the
Settlement Administrator as non-delivered on or before the
Response Deadline shall be re-mailed to the forwarding address
affixed thereto. If no forwarding address is provided, the
Settlement Administrator shall promptly attempt to determine a
correct address by use of skip-tracing, or other search using the
name, address and/or Social Security number of the Settlement
Class Member involved, and shall then perform a re-mailing, if
another mailing address is identified by the Settlement
Administrator. Settlement Class Members who received a re-
mailed Notice Packet shall have their Response Deadline
extended 15 days from the original Response Deadline.
(c) Disputes Regarding Individual Settlement Payments. Settlement
Class Members will have the opportunity, should they disagree
with records regarding the total amounts of their investments in
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the Investment Funds, to provide documentation and/or an
explanation to show contrary investment amounts. If there is a
dispute, the Settlement Administrator will consult with the
Parties to determine whether an adjustment is warranted. The
Settlement Administrator shall determine the eligibility for, and
the amounts of, any Individual Settlement Payments under the
terms of this Agreement. The Settlement Administrator’s
determination of the eligibility for and amount of any Individual
Settlement Payment shall be binding upon the Settlement Class
Member and the Parties.
(d) Disputes Regarding Administration of Settlement. Any disputes
not resolved by the Settlement Administrator concerning the
administration of the Settlement will be resolved by the Court
under the laws of the State of California. Prior to any such
involvement of the Court, counsel for the Parties will confer in
good faith to resolve the disputes without the necessity of
involving the Court.
(e) Exclusions. The Notice Packet shall state that Settlement Class
Members who wish to exclude themselves from the Settlement
must submit a written request for exclusion by the Response
Deadline. The written request for exclusion must state that the
Settlement Class Member wishes to exclude himself or herself
from the Settlement and (1) must contain the name, address,
telephone number and the last four digits of the Social Security
number of the person requesting exclusion; (2) must be signed
by the Settlement Class Member; and (3) must be postmarked or
fax stamped by the Response Deadline and returned to the
Settlement Administrator at the specified address or fax
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telephone number. The request for exclusion will not be valid if
it is not timely submitted, if it is not signed by the Settlement
Class Member, or if it does not contain the name and address of
the Settlement Class Member. The date of the postmark on the
return mailing envelope or fax stamp on the request for
exclusion shall be the exclusive means used to determine
whether the request for exclusion was timely submitted. Any
Settlement Class Member who requests to be excluded from the
Settlement Class will not be entitled to any recovery under the
Settlement and will not be bound by the terms of the Settlement
or have any right to object, appeal or comment thereon.
Settlement Class Members who fail to submit a valid and timely
written request for exclusion on or before the Response Deadline
shall be bound by all terms of the Settlement and any final
judgment entered in this Action if the Settlement is approved by
the Court. No later than 25 calendar days after the Response
Deadline, the Settlement Administrator shall provide counsel for
the Parties with a final list of the Settlement Class Members who
have timely submitted written requests for exclusion. At no
time shall any of the Parties, their counsel or anyone acting on
their behalf seek to solicit or otherwise encourage members of
the Settlement Class to submit requests for exclusion from the
Settlement.
(f) Objections. The Notice Packet shall state that Settlement Class
Members who wish to object to the Settlement must file with the
Court and serve on all Parties a written statement of objection
(“Notice of Objection”) by the Response Deadline. The date of
filing and the date on the proof of service shall be deemed the
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exclusive means for determining that a Notice of Objection was
filed and served timely. The Notice of Objection must be signed
by the Settlement Class Member and state: (1) the full name of
the Settlement Class Member; (2) the dates of his or her
investment in the REP Investment Funds, the amount invested in
any REP Investment Fund, and in which REP Investment Fund
such Settlement Class Member invested; (3) the last four digits
of the Settlement Class Member’s Social Security number or
Tax I.D. Number; (4) the basis for the objection; and (5) if the
Settlement Class Member intends to appear at the Final
Approval/Settlement Fairness Hearing. Settlement Class
Members who fail to make objections in the manner specified
above shall be deemed to have waived any objections and shall
be foreclosed from making any objections (whether by appeal or
otherwise) to the Settlement. Settlement Class Members who
submit a timely Notice of Objection will have a right to appear
at the Final Approval/Settlement Fairness Hearing in order to
have their objections heard by the Court. At no time shall any of
the Parties, their counsel or anyone acting on their behalf seek to
solicit or otherwise encourage Settlement Class Members to file
or serve written objections to the Settlement or appeal from the
Order and Final Judgment. Class Counsel shall not represent
any Settlement Class Members with respect to any such
objections.
41. Funding and Allocation of Gross Settlement Fund. Defendants shall
pay a maximum amount of $9,250,000.00 in full and complete settlement of the
Released Claims, which sum includes all attorneys' fees, costs, claims
administration costs, and enhancement awards to the class representatives. This is
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a non-reversionary, common fund Settlement in which Defendants have agreed to
pay, in installments, the entirety of the Gross Settlement Fund. The Gross
Settlement Fund will then be paid out, in its entirety, as reimbursements to the REP
Bankruptcy Estate (if any), Individual Settlement Payments, Class Representative
Service Awards, the Class Counsel Award, and the Settlement Administration
Costs, as specified in this Agreement. No amount of the Gross Settlement Fund
will revert to Defendants. Settlement Class Members will not have to submit any
claims in order to receive their Individual Settlement Payments. The Settlement is
not contingent upon any approval from the bankruptcy court overseeing Case No.
8:07-bk-13239-TA or the bankruptcy trustee. Nor is the Settlement contingent
upon the consummation of any reimbursement to the REP Bankruptcy Estate.
(a) Timing of Defendants’ Payments. Defendants shall fund or
cause to be funded the settlement on the following schedule:
1) 30 percent of the Gross Settlement Fund shall be sent via
wire transfer to an account established by the Settlement
Administrator for this matter by September 30, 2012, or
within 10 days of preliminary approval, whichever is
later;
2) 35 percent of the Gross Settlement Fund shall be sent via
wire transfer to an account established by the Settlement
Administrator for this matter by June 30, 2013; and
3) The remaining 35 percent of the Gross Settlement Fund
shall be sent via wire transfer to an account established by
the Settlement Administrator for this matter by September
30, 2013.
(b) Individual Settlement Payments. Individual Settlement
Payments will be paid from the Net Settlement Amount and
shall be paid pursuant to the settlement formula set forth herein.
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Individual Settlement Payments shall be mailed by regular First
Class U.S. Mail to Settlement Class Members’ last known
mailing address within 14 calendar days after Defendants
provide the final installment of funds to the Settlement
Administrator for disbursement under this Agreement. Any
checks issued to Settlement Class Members shall remain valid
and negotiable for 180 days from the date of their issuance.
After that time, any such unclaimed checks will escheat to the
State of California’s Bureau of Unclaimed Property. This
Settlement is not contingent upon the Court's approval of any
allocation plan, and/or the calculation of Individual Settlement
Payments set forth herein.
(c) Calculation of Individual Settlement Payments. The Settlement
Administrator will calculate the total amounts invested in the
Invested Funds for all Settlement Class Members. The
respective total amounts invested for each Settlement Class
Member will be divided by the total amounts invested for all
Settlement Class Members, resulting in the Payment Ratio for
each Settlement Class Member. Each Settlement Class
Member’s Payment Ratio is then multiplied by the Net
Settlement Amount to determine his or her estimated Individual
Settlement Payment. Settlement Class Members are not eligible
to receive any compensation other than Individual Settlement
Payments from this Settlement. This Settlement is not
contingent upon the Court's approval of any allocation plan,
and/or the calculation of Individual Settlement Payments set
forth herein.
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(d) Class Representative Service Awards. Defendants agree not to
oppose or object to any application or motion by Plaintiffs for
Class Representative Service Awards of up to Twenty-Five
Thousand Dollars ($25,000) each in exchange for the Released
Claims and for their time and effort in bringing and prosecuting
this matter. The Class Representative Service Awards shall be
paid to Plaintiffs from the Gross Settlement Fund no later than
14 calendar days after Defendants provide the final installment
of funds to the Settlement Administrator for disbursement under
this Agreement. Any portion of the requested Class
Representative Service Awards that are not awarded to the Class
Representatives shall be part of the Net Settlement Amount and
shall be distributed to Settlement Class Members as provided in
this Agreement. The Settlement Administrator shall issue an
IRS Form 1099 – MISC to Plaintiffs for their respective Class
Representative Service Awards. Plaintiffs shall be solely and
legally responsible to pay any and all applicable taxes on their
respective Class Representative Service Awards and shall hold
harmless Defendants, Defense Counsel, and Class Counsel from
any claim or liability for taxes, penalties, or interest arising as a
result of the Class Representative Service Award. The Class
Representative Service Award awarded to each Plaintiff shall be
in addition to each Plaintiff’s respective Individual Settlement
Payment as a Settlement Class Member. This Settlement is not
contingent upon the Court awarding Class Representatives any
particular amount in Service Awards.
(e) Class Counsel Award. Defendants agree not to oppose or object
to any application or motion by Class Counsel for attorneys’
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fees not to exceed $2,312,500 (twenty-five percent of the Gross
Settlement Fund) from the Gross Settlement Fund, plus any
actual costs. Additionally, Defendants agree not to oppose or
object to any application or motion by Class Counsel for
approval of the hourly attorneys’ fees which have already been
paid to Class Counsel during the prosecution of this Action by
the Joint Equity Committee. Any portion of the requested Class
Counsel Award that is not awarded to Class Counsel shall be
part of the Net Settlement Amount and shall be distributed to
Settlement Class Members as provided in this Agreement. The
Class Counsel Award shall be paid to Class Counsel from the
Gross Settlement Fund no later than 14 calendar days after
Defendants provide funds to the Settlement Administrator for
disbursement under this Agreement. Class Counsel shall be
solely and legally responsible to pay all applicable taxes on the
payment made pursuant to this paragraph. The Settlement
Administrator shall issue an IRS Form 1099 – MISC to Class
Counsel for the payments made pursuant to this paragraph. This
Settlement is not contingent upon the Court awarding Class
Counsel any particular amount in attorneys’ fees and costs,
although Plaintiffs and Class Counsel do not waive their right to
challenge the Class Counsel Award. Nor is this Settlement
contingent upon approval of any or all of the discounted hourly
attorneys' fees which have already been paid to Class Counsel
from the REP Bankruptcy Estate during the prosecution of this
action by the Joint Equity Committee.
(f) Settlement Administration Costs. The Settlement Administrator
shall be paid for the costs of administration of the Settlement
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from the Gross Settlement Fund. The estimate of such costs of
administration for the disbursement of the Gross Settlement
Fund is approximately $14,000. No fewer than 21 days prior to
the Final Approval Hearing, the Settlement Administrator shall
provide the Parties with a statement detailing the costs of
administration of this Settlement. The Settlement Administrator
shall be paid the Settlement Administration Costs no later than
14 calendar days after Defendants provide the final instalment of
funds to the Settlement Administrator for disbursement under
this Agreement. The Settlement Administrator shall have the
authority and obligation to make payments, credits and
disbursements, including payments and credits in the manner set
forth herein, to Settlement Class Members calculated in
accordance with the methodology set out in this Agreement and
orders of the Court.
1) The Parties agree to cooperate in the Settlement
administration process and to make all reasonable efforts
to control and minimize the cost and expenses incurred in
administration of the Settlement. The Parties each
represent they do not have any financial interest in the
Settlement Administrator or otherwise have a relationship
with the Settlement Administrator that could create a
conflict of interest.
2) The Settlement Administrator shall be responsible for:
processing and mailing payments to the Plaintiffs, Class
Counsel, and Settlement Class Members; printing and
mailing the Notice Packets to the Settlement Class
Members as directed by the Court; receiving and reporting
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the requests for exclusion submitted by Settlement Class
Members; distributing tax forms; providing declaration(s)
as necessary in support of preliminary and/or final
approval of this Settlement; and other tasks as the Parties
mutually agree or the Court orders the Settlement
Administrator to perform. The Settlement Administrator
shall keep the Parties timely apprised of the performance
of all Settlement Administrator responsibilities. No later
than 25 calendar days after distributions are issued, the
Settlement Administrator shall provide counsel for the
Parties with an accounting of the Gross Settlement Fund
and report the amount of all payments issued to each
Settlement Class Member. At the conclusion of the 180
day period allowed for negotiation of checks issued from
the Gross Settlement Fund, the Settlement Administrator
will provide the Parties with an accounting of the amount
of money, if any, that will escheat to the State of
California’s Bureau of Unclaimed Property.
(g) No person shall have any claim against Defendants, Defense
Counsel, Plaintiffs, Settlement Class Members, Class Counsel or
the Settlement Administrator based on distributions and
payments made in accordance with this Agreement.
42. Option to Terminate Settlement. If, after the Response Deadline and
before the Final Approval/Settlement Fairness Hearing, the Settlement Class
Members who submitted timely and valid written requests for exclusion from the
Settlement represent an amount greater than the amount reflected in the letter
agreement between the Parties executed contemporaneously with this Agreement,
Defendants shall then have, in their sole discretion, the option to terminate this
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Settlement at any time prior to the issuance of an Order granting final approval. If
Defendants exercise their option to terminate this Settlement, Defendants shall: (a)
provide written notice to Class Counsel and (b) pay all Settlement Administration
Costs incurred up to the date and as a result of the termination up to a maximum
amount of $14,000.00. The Parties shall, if this option is exercised, proceed in all
respects as if this Agreement had not been executed.
43. Final Settlement Approval Hearing and Entry of Final Judgment.
Upon expiration of the Response Deadline, with the Court’s permission, a Final
Approval/Settlement Fairness Hearing shall be conducted to determine final
approval of the Settlement along with the amount properly payable for (i)
reimbursement to the REP Bankruptcy Estate (if any), (ii) the Class Counsel
Award, (iii) the Class Representative Service Awards, (iv) Individual Settlement
Payments, and (v) the Settlement Administration Costs. Approval of the
Settlement and entry of the Order and Final Judgment is not contingent on the
approval of (i) reimbursement to the REP Bankruptcy Estate (if any), (ii) the Class
Counsel Award, (iii) the Class Representative Service Awards, (iv) Individual
Settlement Payments, and (v) the Settlement Administration Costs. Any hearing
conducted pursuant to this paragraph, shall be set no less than fourteen (14) days
after the Response Deadline. The Parties shall jointly request the Court to enter the
Order and Final Judgment in the form attached hereto as Exhibit 2. After entering
the Order and Final Judgment, the Court shall retain jurisdiction over the Parties to
enforce the terms of the judgment. Judgment shall be entered dismissing the
Action with prejudice, and barring all Released Claims as described in Paragraphs
22 and 36.
44. Nullification of Settlement Agreement. In the event: (i) the Court does
not enter the Preliminary Approval Order substantially in the form attached hereto
as Exhibit 3; (ii) the Court does not enter the Order and Final Judgment
substantially in the form attached hereto as Exhibit 2; or (iii) the Settlement does
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not become final for any other reason, Plaintiffs, on the one hand, and Defendants,
on the other hand, shall, in their separate discretions, have the right to terminate the
Settlement, and thereby this Settlement Agreement, by providing written notice of
their election to do so to all Parties hereto within thirty (30) days of the occurrence
of one of the events above. If Plaintiffs or Defendants elect to terminate this
Settlement Agreement pursuant to this paragraph, the Settlement Agreement, with
the exception of paragraphs 34, 35, 45, 50, and 57, shall be null and void and any
order or judgment entered by the Court in furtherance of this Settlement shall be
treated as void from the beginning. In such a case, the Parties and any funds to be
awarded under this Settlement shall be returned to their respective statuses as of the
date and time immediately prior to the execution of this Agreement, and the Parties
shall proceed in all respects as if this Agreement had not been executed. In the
event an appeal is filed from the Court’s final judgment, or any other appellate
review is sought, administration of the Settlement shall be stayed pending final
resolution of the appeal or other appellate review, but any fees incurred by the
Settlement Administrator prior to it being notified of the filing of an appeal from
the Court’s Final Judgment, or any other appellate review, shall be paid to the
Settlement Administrator within thirty (30) days of said notification.
45. No Admission By the Parties. Defendants deny any and all claims
alleged in this Action and deny all wrongdoing whatsoever. This Agreement is not
a concession or admission, and shall not be used against Defendants as an
admission or indication with respect to any claim of any fault, concession or
omission by Defendants.
46. Exhibits and Headings. The terms of this Agreement include the terms
set forth in any attached Exhibit 1, which are incorporated by this reference as
though fully set forth herein. Any Exhibit to this Agreement is an integral part of
the Settlement. The descriptive headings of any paragraphs or sections of this
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Agreement are inserted for convenience of reference only and do not constitute a
part of this Agreement.
47. Interim Stay of Proceedings. The Parties agree to stay all proceedings
in the Action, except such proceedings necessary to implement and complete the
Settlement, in abeyance pending the Final Approval/Settlement Fairness Hearing to
be conducted by the Court.
48. Amendment or Modification. This Agreement may be amended or
modified only by a written instrument signed by counsel for all Parties or their
successors-in-interest.
49. Entire Agreement. This Agreement and any attached Exhibits
constitute the entire Agreement among these Parties, and no oral or written
representations, warranties or inducements have been made to any Party concerning
this Agreement or its Exhibits other than the representations, warranties and
covenants contained and memorialized in the Agreement and its Exhibits.
50. Authorization to Enter Into Settlement Agreement. Counsel for all
Parties warrant and represent they are expressly authorized by the Parties whom
they represent to negotiate this Agreement and to take all appropriate actions
required or permitted to be taken by such Parties pursuant to this Agreement to
effectuate its terms, and to execute any other documents required to effectuate the
terms of this Agreement. The Parties and their counsel will cooperate with each
other and use their best efforts to effect the implementation of the Settlement. The
persons signing this Agreement on behalf of Defendants represent and warrant that
they are authorized to sign this Agreement on behalf of Defendants. Plaintiffs
represent and warrant that they are authorized to sign this Agreement and that they
have not assigned any claim, or part of a claim, covered by this Settlement to a
third-party.
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51. Binding on Successors and Assigns. This Agreement shall be binding
upon, and inure to the benefit of, the successors or assigns of the Parties hereto, as
previously defined.
52. California Law Governs. All terms of this Agreement and the Exhibit
hereto and any disputes arising hereunder shall be governed by and interpreted
according to the laws of the State of California.
53. Counterparts. This Agreement may be executed in one or more
counterparts. All executed counterparts and each of them shall be deemed to be
one and the same instrument provided that counsel for the Parties to this Agreement
shall exchange among themselves copies or originals of the signed counterparts.
54. This Settlement Is Fair, Adequate and Reasonable. The Parties believe
this Settlement is a fair, adequate and reasonable settlement of this Action and have
arrived at this Settlement after vigorous litigation, thorough discovery, and
extensive arms-length negotiations, taking into account all relevant factors and
risks, both present and potential.
55. Jurisdiction of the Court. The Parties agree that the Court shall retain
jurisdiction with respect to the interpretation, implementation and enforcement of
the terms of this Agreement and all orders and judgments entered in connection
therewith, and the Parties and their counsel hereto submit to the jurisdiction of the
Court for purposes of interpreting, implementing and enforcing the settlement
embodied in this Agreement and all orders and judgments entered in connection
therewith.
56. Invalidity of Any Provision. Before declaring any provision of this
Agreement invalid, the Court shall first attempt to construe the provisions valid to
the fullest extent possible consistent with applicable precedents so as to define all
provisions of this Agreement valid and enforceable.
57. Confidentiality of the Agreement and Settlement. The Parties agree
that until the entry of the Preliminary Approval Order this Agreement and the
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Settlement, including its terms, shall be maintained in the strictest confidence and
will not be disclosed by the Parties, their Counsel, their agents, or anyone acting for
or through them except as necessary to secure the Preliminary Approval Order or to
comply with any applicable law or regulation that might require disclosure.
PLAINTIFFS
Dated: July ___, 2012 By: Bradley B. Larsen, as Trustee of the Brad and Cindy Larsen Loving Trust
Dated: July ___, 2012 By:
Jimmy R. Bunch, Jr.
Dated: July ___, 2012 By: Stephen J. Woodward
Dated: July ___, 2012 By:
(Print Name) On behalf of Sun Holdings, LLC
Dated: July ___, 2012 By: Daniel Todd
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JOINT EQUITY COMMITTEE <
Dated: July /f ,2012
CLASS COUNSEL
Dated: July is , 2012
Dated: July ,2012
(Print Name)
On behalf of Joint Equity Committee
SPIRO MOORE LLP
By:.J. Mark MooreIra SpiroH. Scott Leviant
Attorneys for Plaintiffs and the Class
NEWHOUSEJSEROUSSI Attorneys, PC
By:.Michael R. NewhouseRuth SeroussiSuzanne M. Henry
Attorneys for Plaintiffs and the Class
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Case No. S ACV 1 0-00401 AG (MLGx) Page 27STIPULATION OF CLASS ACTION SETTLEMENT AND CLASS ACTION SETTLEMENT
AGREEMENT672! 18.01-Los Angeles Server IA - MSW
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Settlement, including its terms, shall be maintained in the strictest confidence and
will not be disclosed by the Parties, their Counsel, their agents, or anyone acting for
or through them except as necessary to secure the Preliminary Approval Order or to
comply with any applicable law or regulation that might require disclosure.
PLAINTIFFS
Dated: July ___, 2012 By: Bradley B. Larsen, as Trustee of the Brad and Cindy Larsen Loving Trust
Dated: July 19, 2012 By:
Jimmy R. Bunch, Jr.
Dated: July ___, 2012 By: Stephen J. Woodward
Dated: July ___, 2012 By:
(Print Name) On behalf of Sun Holdings, LLC
Dated: July ___, 2012 By: Daniel Todd
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JOINT EQUITY COMMITTEE
Dated: July ___, 2012 By:
(Print Name) On behalf of Joint Equity Committee
CLASS COUNSEL
SPIRO MOORE LLP Dated: July ___, 2012 By:
J. Mark Moore Ira Spiro H. Scott Leviant Attorneys for Plaintiffs and the Class
NEWHOUSE|SEROUSSI Attorneys, PC Dated: July ___, 2012 By:
Michael R. Newhouse Ruth Seroussi Suzanne M. Henry Attorneys for Plaintiffs and the Class
[SIGNATURES CONTINUED ON NEXT PAGE]
scott
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