Perez v. Target Corporation

Background

This order concerns competing motions under the Private Securities Litigation Reform Act of 1995 for appointment as lead plaintiff and approval of lead counsel in a proposed securities class action. The proposed class consists of investors who allege claims involving Target stock. The competing movants were the Terry and Diane Van Der Tuuk Living Trust, Gary Schaedel, Brian Howard, and John W. Zlatic and Chester Zoll.

Under the statute, the court must appoint the proposed class member most capable of adequately representing the class. The statute creates a rebuttable presumption that the person who filed the complaint or moved for appointment, has the largest financial interest in the relief sought, and satisfies the relevant requirements of Federal Rule of Civil Procedure 23 is the most adequate plaintiff.

Lead Plaintiff Analysis

Gary Schaedel’s motion was timely and unopposed. He alleged losses of $194,424.39 related to Target stock during the class period. The Trust, Howard, and Zlatic and Zoll acknowledged that they did not appear to have the largest financial interest.

The court examined whether Schaedel’s claims were typical of the proposed class and whether he could adequately represent it. The court found that his claims were typical. It also found that Schaedel understood the responsibilities of a lead plaintiff, including overseeing and directing counsel and providing testimony at a deposition or trial if necessary. The court found no conflict between his interests and those of the proposed class and no unique defenses applying to him.

Counsel

Schaedel selected Wolf Haldenstein Adler Freeman & Herz LLP as lead counsel. Based on the firm’s experience in securities and class-action litigation, the court found it qualified to represent the proposed class and approved the selection.

The order’s footnote also discusses the Schall Law Firm, which was referenced as additional proposed counsel in some filings. Schaedel’s motion and proposed order requested approval only of Wolf Haldenstein as lead counsel. The court did not approve the Schall Law Firm as lead counsel in this order.

Order and Next Steps

The court ordered the following:

- The Terry and Diane Van Der Tuuk Living Trust’s motion for appointment as lead plaintiff and approval of counsel was DENIED WITHOUT PREJUDICE. - Gary Schaedel’s motion for appointment as lead plaintiff and approval of his counsel was GRANTED. - Brian Howard’s motion for appointment as lead plaintiff and approval of counsel was DENIED WITHOUT PREJUDICE. - John W. Zlatic and Chester Zoll’s motion for appointment as co-lead plaintiffs and approval of counsel was DENIED WITHOUT PREJUDICE. - Gary Schaedel was appointed lead plaintiff. - Wolf Haldenstein Adler Freeman & Herz LLP was approved as lead counsel.

The parties were ordered to meet and confer in good faith about a proposed schedule for filing an amended complaint or designating an operative complaint, and for the defendants to answer or otherwise respond. They were required to file a joint stipulation with a proposed schedule within 14 days of the order. The order did not decide the underlying securities claims.