Altimeo Asset Management v. Qihoo 360 Technology Co. Ltd.
- Paul Engelmayer
- 1:19-cv-10067
- U.S. District Court · Southern District of New York
- 3
In Altimeo Asset Management v. Qihoo 360, Judge Engelmayer postponed the conference and continued the discovery stay while reconsideration was pending.
The order affects the plaintiffs, defendants, and their counsel by delaying general discovery and the case-management conference while the plaintiffs’ partial reconsideration motion is pending. Counsel must nevertheless begin discussing discovery concerning the sustained seller-shareholder claims.
What happened
Altimeo Asset Management and ODS Capital LLC sued Qihoo 360 Technology Co. Ltd. and others in a securities case involving seller and tenderer shareholders. The court had planned to use the conference to set discovery and discuss anticipated class-certification and summary-judgment motions.
Plaintiffs then asked the court to partially reconsider its earlier decision on defendant Zhou’s motion to dismiss. That motion could restore claims by tenderer shareholders and change the scope of discovery and future motions.
The court adjourned the April 10, 2023 case-management conference without setting a new date and continued the discovery stay until the reconsideration motion is resolved. Judge Paul A. Engelmayer also directed counsel to begin discussing discovery concerning the claims that had survived.
The detailed version
- Altimeo Asset Management v. Qihoo 360 Technology Co. Ltd. · No. 1:19-cv-10067
- Paul Engelmayer
- Apr. 7, 2023
Background
The court had scheduled a case-management conference for April 10, 2023, primarily to establish a discovery schedule and discuss the timing and sequence of anticipated motions for class certification and summary judgment. The plaintiffs are Altimeo Asset Management and ODS Capital LLC, individually and on behalf of a proposed class. The defendants are Qihoo 360 Technology Co. Ltd., Hongyi Zhou, Xiangdong Ql, and Eric X. Chen.
On April 5, 2023, the plaintiffs moved for partial reconsideration of the court’s decision on Zhou’s motion to dismiss. The opinion states that the motion could restore claims by “tenderer shareholders,” based on a loss-causation theory different from the theory associated with the “seller shareholders,” whose claims the court had largely sustained as plausibly pleaded.
Reasoning
The court concluded that resolving the reconsideration motion could significantly change the issues and claims in the case. That resolution could therefore affect the scope of proper discovery and the timing of class-certification briefing. The court also explained that the reconsideration motion functioned as a request to amend the complaint and that an anticipated defense to the proposed amended claims would, in substance, operate like a motion to dismiss those claims.
Because the Private Securities Litigation Reform Act generally stays discovery while a motion to dismiss is pending, the court found that the principles supporting that stay applied here. It determined that beginning discovery before resolving the reconsideration motion would be inefficient and that adopting a case-management plan with a discovery schedule would be premature.
Order
The court adjourned the April 10 case-management conference without setting a new date and maintained the stay of discovery pending resolution of the partial reconsideration motion. After that motion is resolved, the court will schedule a new conference and request a proposed case-management plan. The court separately directed counsel to begin discussing the proper merits and class-certification discovery concerning the sustained seller-shareholder claims.
This order did not decide the pending partial reconsideration motion or resolve the underlying securities claims.
Read the full 3-page opinion on CourtListener, the free public archive maintained by the Free Law Project.