Dickerson v. Macmillan

Background

This is a proposed securities class action. Brenna Dickerson moved under the Private Securities Litigation Reform Act (PSLRA) to be appointed lead plaintiff. She also asked the court to appoint Monteverde & Associates PC as lead counsel for the proposed class. The motion was unopposed.

Lead Plaintiff

The court described the PSLRA’s three-step process. First, a potential lead plaintiff must publish notice of the lawsuit and the opportunity for class members to seek appointment. Second, the court identifies the person most capable of adequately representing the class, with a rebuttable presumption favoring the person who responded to the notice, has the largest financial interest, and satisfies the requirements of Federal Rule of Civil Procedure 23. Third, class members may rebut that presumption by showing problems with the proposed plaintiff’s typicality or adequacy.

The court found that Dickerson met the notice requirement. She filed the complaint on March 21, 2023, published the required notice through PR Newswire on March 23, 2023, and filed her motion on May 22, 2023. The court also found that she had the largest financial interest among the putative class members. Dickerson alleged that she owned 100 shares of UserTesting common stock before the acquisition and had to exchange them for less than fair value. No other class member claimed a greater financial interest.

The court further found that Dickerson had shown typicality and adequacy. She alleged that she suffered the same kind of harm as other class members because of the same allegedly false or misleading statements in the proxy materials. She also alleged that she had no unique defenses and no conflict of interest with other prospective class members. No class member rebutted the presumption that she could adequately represent the class. The court therefore granted Dickerson’s motion to be appointed lead plaintiff under the PSLRA.

Lead Counsel

The court explained that the PSLRA gives the lead plaintiff the power to select lead counsel, subject to the court’s review. Federal Rule of Civil Procedure 23(g) directs courts to consider counsel’s work investigating the claims, experience with class actions and similar litigation, knowledge of the applicable law, and resources for representing the class.

Dickerson selected Monteverde & Associates PC. The court found that the firm had investigated the potential claims, including the parties, the allegedly false or misleading statements surrounding the acquisition, and the relevant class period. The firm also demonstrated experience litigating securities class actions and knowledge of the applicable law. It represented that it had committed resources to investigating the claims and would continue doing so during the case.

The court granted Dickerson’s motion for Monteverde & Associates PC to serve as interim class counsel. The order appointed class leadership but did not decide the underlying securities claims.