Mehedi v. View, Inc. f/k/a CF Finance Acquisition Corp. II
- Beth Freeman
- 5:21-cv-06374
- U.S. District Court · Northern District of California
- 3
In Mehedi v. View, Judge Freeman denied Sonthalia’s request to seek reconsideration, finding the court had already considered her arguments about loss calculations.
Sweta Sonthalia’s request to challenge the appointment of Stadium Capital LLC as lead plaintiff and Kaplan Fox & Kilsheimer LLP as lead counsel was denied; the prior appointment order remained in place.
What happened
In Mehedi v. View, Inc., the court had appointed Stadium Capital LLC as lead plaintiff and Kaplan Fox & Kilsheimer LLP as lead counsel in the securities class action against View, Inc. Sweta Sonthalia, whose earlier request for appointment was denied, asked for permission to seek reconsideration of that order.
Sonthalia argued that the court had overlooked material facts and important legal arguments. She challenged the court’s decision not to use stock purchase prices to calculate losses and its decision not to count losses from View’s stock-price changes before the alleged August 16, 2021 corrective disclosure.
Judge Freeman denied Sonthalia’s motion for leave to file a reconsideration motion. Judge Freeman found that the court had considered both arguments and had chosen a different loss-calculation method; the court therefore found no manifest failure to consider the facts or arguments presented.
The detailed version
- Mehedi v. View, Inc. f/k/a CF Finance Acquisition Corp. II · No. 5:21-cv-06374
- Beth Freeman
- Feb. 23, 2022
Background
The underlying case is a securities class action brought by Asif Mehedi against View, Inc. On February 8, 2022, the court appointed Stadium Capital LLC as lead plaintiff and Kaplan Fox & Kilsheimer LLP as lead counsel. The court denied competing requests, including Sweta Sonthalia’s request to be appointed lead plaintiff and lead counsel.
On February 22, 2022, Sonthalia asked for permission to file a motion asking the court to reconsider its appointment order. She relied on Civil Local Rule 7-9(b)(3), which requires a party to show reasonable diligence and a manifest failure by the court to consider material facts or decisive legal arguments that were presented before the earlier order.
Arguments
Sonthalia argued that the court had improperly rejected the movants’ stock purchase prices when calculating their losses. She also argued that the court improperly made a factual finding by declining to consider her losses from View stock-price fluctuations before the alleged August 16, 2021 corrective disclosure.
Court’s Analysis
The court rejected both arguments. It explained that it had considered using the stock purchase price but chose the View stock price immediately before the corrective disclosure as a better measure of recoverable loss. The court also stated that it had considered cases using purchase price, including Dura Pharma., Inc. v. Broudo, but adopted a different approach consistent with the principle that losses occurring before a corrective disclosure should not be included in the loss calculation.
The court further explained that it had considered the losses occurring before the corrective disclosure but did not include them because the complaint alleged a single corrective disclosure occurring afterward. The court said this was not a factual finding about the losses; it was a calculation based on the complaint’s allegations.
Disposition
Judge Freeman denied Sonthalia’s motion for leave to file a motion for reconsideration of the order appointing Stadium as lead plaintiff and Kaplan Fox as lead counsel. The opinion does not state that the court separately reconsidered or changed that appointment order.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.