Monday, February 06, 2006

Who Says We're Professionals?

Perhaps you recall back in August when Judge Harvey Bartle III (E.D. Penn.) rejected Defendants’ Dura arguments in the Vicuron Pharmaceuticals securities class action. Well, it looks like things aren’t improving much for them at the class certification stage. You see, Defendants balked when Lead Plaintiffs "Massachusetts State Carpenters Pension Fund ("MSCPF"), Massachusetts State Guaranteed Annuity Fund ("MSGAF"), and the Greater Pennsylvania Carpenters Pension Fund ("GPCPF") asked to also serve as class representatives (seems nice of them to offer, doesn’t it?), arguing that they "are unfit" "because they are ‘professional plaintiffs’ barred from serving in this capacity by the PSLRA and because they played little or no role in the decision to purchase Vicuron stock."

But, alas, Judge Bartle rejected the first argument, holding that "the fact that the MSCPF and MSGAF have been class representatives in as many prior class actions as they have does not preclude their filling that role in this case." And as for the argument about their role in purchasing the stock, Judge Bartle shot that down too, saying "the fact that institutional plaintiffs used money managers and investment advisors to purchase Vicuron stock does not suggest plaintiffs are inadequate to protect and pursue the interests of the class."

Result? Class certified.

You can read In re Vicuron, issued February 1, 2006, here, (thanks again to Adam T. Savett at Mehri & Skalet for the link) or at 2006 U.S. Dist. LEXIS 3861.

Nugget: "If an institutional investor cannot be a class representative simply because it turned over day-to-day investment decisions to professional money managers or advisors, few if any institutional investors could be class representatives in any securities action. Such a result is contrary to the intentions of Congress embodied in the PSLRA that institutional investors should oversee more securities actions."

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