New Service for Securities Class Action Researchers

Pssst… here’s a tip for you Nugget subscribers who just happen to be securities class action researchers. If your dream is to be able to word-search thousands of unpublished (and published) securities class action orders, opinions, and even minute entries check out the new service Acquirelaw™ at www.acquirelaw.com. I’m betting you won’t be sorry you did.

As for the Nugget, please be patient, I’ll get back in the swing of things soon. At least for this blogger, it’s a personal endeavor, so it’s something I do in my limited spare time, which lately has been very limited. Thank you for the many kind words from those of you who miss the Nugget’s ramblings – you make it all worthwhile, especially my favorite frequent commenters “Gary,” and “The Defense Bar,” whoever you are.

The Case that Just Won’t Die

So let’s see, back in 1999, the Judge approved the settlement of the In re Paracelus securities class action, and entered final judgment. So why in the world are we reading a Memorandum Opinion issued in the case eight years later, you might ask? Well, it seems the settlement distribution process “took years,” with “lost checks,” and trying to “find claimants who were no longer at the addresses that had been provided.” So finally, “at the end of this process,” and after “approximately 1,400 claimants had received and cashed settlement funds,” a whopping $30,547.06 remained unclaimed.

So no big deal, right? Well, Lead Counsel proposed that the money be distributed to two designated charities, the Methodist Hospital Foundation and the Houston Volunteer Lawyers Program, invoking cy pres. Oh, but it’s not going to be that easy. The Judge said that “neither of the two designated charities was related to the class or its members,” and to make matters worse, “one charity was connected to the district judge, who promptly recused.” After reassignment, and a whole new round of briefing, along with a hearing, Judge Lee H. Rosenthal (S.D. Tex.) finally ordered that the money go to the “Institute of Law and Economic Policy, which will spend the money in a way that may indirectly and prospectively benefit the class members in the aggregate.”

Sheesh.

You can read In re Paracelus, issued February 6, 2006 at 2007 U.S. Dist. LEXIS 8316.

Nugget: “In the class action context the reason for appealing to cy pres is to prevent the defendant from walking away from the litigation scot-free because of the infeasibility of distributing the proceeds of the settlement (or the judgment, in the rare case in which a class action goes to trial) to the class members.”