This summary was prepared by Kevin F. Brady of Connolly Bove Lodge & Hutz LLP.
On May 27, 2011, in Nierenberg v.CKx, Inc., et al., C. A. No. 5545-CC, VanWhy v. CKx, Inc., et al., C. A. No. 6519-CC and Leone v. CKx, Inc., et al., C. A. No. 6524-CC, the Court addressed cross-motions by plaintiffs to appoint plaintiffs’ lead counsel in three substantially similar shareholder class actions challenging the proposed acquisition of CKx, Inc. by Apollo Global Management, LLC. One of these actions, Leone v. CKx, Inc. was originally filed in New York state court. Defendants filed motions in both the New York and Delaware courts. The judges in those courts conferred and decided to allow the litigation to proceed in only one jurisdiction while the litigation in the other jurisdiction was dismissed or stayed.
The plaintiff in the New York action voluntarily agreed to a stay of the New York action pending resolution of the Delaware actions – provided that plaintiff in the New York action be given “the same document and deposition discovery” as well as “an opportunity to litigate equally with” plaintiffs in Delaware. The parties then agreed that the actions should be consolidated pursuant to Court of Chancery Rule 42(a) – related class actions on behalf of the same class involving common questions of fact or law.
After analyzing the factors set out in Hirt v. U.S. Timberlands Serv. Co., LLC, 2002 WL 1558342, at *2 (July 3, 2002): (1) the quality of the pleadings, (2) the relative economic stakes of the competing plaintiffs, (3) the willingness and ability of counsel to vigorously litigate plaintiffs’ claims on behalf of the class, (4) competence of counsel, (5) the absence of conflict between larger and smaller stockholders, and (6) the enthusiasm and vigor with which counsel has prosecuted the lawsuit, the Court concluded that Abbey Spanier Rodd & Abrams, LLP and Faruqi & Faruqi, LLP would be appointed co-lead counsel in the consolidated action, and Rosenthal, Monhait & Goddess, P.A. would be appointed liaison counsel. Rigrodsky & Long, P.A. was appointed a member of plaintiffs’ committee.