Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 1 of 6 PageID #: 204

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1 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 1 of 6 PageID #: 204 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF TEXAS TYLER DIVISION LOCAL 731 I.B. OF T. EXCAVATORS AND PAVERS PENSION TRUST FUND, Individually and on Behalf of All Others Similarly Situated No. 6:13cv247 v. DIODES, INC., KEH-SHEW LU and RICHARD WHITE ORDER APPOINTING LEAD PLAINTIFF AND LEAD COUNSEL Currently before the Court is Plaintiff s Motion for Appointment as Lead Plaintiff and Approval of Selection of Counsel (Doc. No. 14). For the reasons set forth below, Plaintiff s motion is GRANTED. I. BACKGROUND Plaintiff Local 731 I.B. of T. Excavators and Pavers Pension Trust Fund 1 (Local 731 Teamsters) commenced this putative class action against Defendants alleging violations of the Securities Exchange Act of 1934 and Rule 10b-5 promulgated thereunder. Plaintiff alleges that Defendants issued materially false and misleading statements and omitted adverse facts regarding Defendant Diodes Inc. s financial performance and future prospects. The proposed class consists of all those who purchased or otherwise acquired [Diodes] common stock during the period between February 9, 2011 and June 9, 2011 (Doc. No. 14 at 1). On March 15, 2013 the same day Plaintiff filed its complaint Plaintiff published a notice of its complaint on BusinessWire (Doc. No. 14-2). Plaintiff filed this motion on May 14, 1 In its motion, Plaintiff notes that it is comprised of Local 731 I.B. of T. Excavators and Pavers Pension Trust Fund and Local 731 I.B. of T. Private Scavenger and Garage Attendants Pension Trust Fund and Textile Maintenance and Laundry Craft Pension Fund. Page 1 of 6

2 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 2 of 6 PageID #: , 60 days after it filed its complaint. No opposition has been filed, and no other plaintiffs have sought appointment as lead plaintiff. II. LEGAL STANDARD a. Notice and Motion for Lead Plaintiff The Private Securities Litigation Reform Act of 1995 (PSLRA) governs securities class actions. The PSLRA requires the plaintiff who files the initial complaint to publish a notice within 20 days of filing the complaint. The notice must be published in a business-oriented publication and must inform class members of their right to file a motion for appointment as lead plaintiff. 15 U.S.C. 78u-4(a)(3)(A)(i). Potential class members then have 60 days to move the court for appointment as lead plaintiff. Id. b. Appointment of Lead Plaintiff After notice has been given to class members, the Court must appoint a lead plaintiff. 15 U.S.C. 78u-4(a)(3)(B)(i). In appointing a lead plaintiff, the court presumes the most adequate plaintiff is the person or group that (1) has either filed the complaint or moved to be lead plaintiff; (2) has the largest financial interest in the relief sought by the class ; and (3) otherwise satisfies the requirements of Rule 23 of the Federal Rules of Civil Procedure. 15 U.S.C. 78u-4(a)(3)(B)(iii)(I). Of the requirements in Rule 23(a), [t]ypicality and adequacy are directly relevant to the choice of the Lead Plaintiff as well as the class representative in securities fraud class actions. In re Enron Corp. Sec. Litig., 206 F.R.D. 427, 441 (S.D. Tex. 2002); see also In re Oxford Health Plans, Inc. Sec. Litig., 182 F.R.D. 42, 49 (S.D.N.Y. 1998) ( Typicality and adequacy of representation are the only provisions [of Rule 23(a)] relevant to a determination of lead plaintiff under the PSLRA. ). The proposed lead plaintiff need only make a preliminary showing that it satisfies the typicality and adequacy requirements of Rule 23. In Page 2 of 6

3 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 3 of 6 PageID #: 206 re XM Satellite Radio Holdings Sec. Litig., 237 F.R.D. 13, 18 (D.D.C. 2006); Reese v. Bahash, 248 F.R.D. 58, 62 (D.D.C. 2008). c. Appointment of Lead Counsel The most adequate plaintiff shall, subject to the approval of the court, select and retain counsel to represent the class. 15 U.S.C. 78u-4(a)(3)(B)(v). III. DISCUSSION a. Appointment of Lead Plaintiff Plaintiff filed its complaint and published notice of the complaint on March 15, On May 14, 2013, Plaintiff moved for appointment as lead counsel. The Court finds that Plaintiff properly published a notice of its complaint on BusinessWire. See In re Facebook, Inc., IPO Sec. and Derivative Litig., 288 F.R.D. 26, 33 (S.D.N.Y. 2012) (stating that BusinessWire is a widely-circulated, national, business-oriented news reporting wire service. ). The Court also finds that Plaintiff filed a timely motion to be appointed as lead plaintiff in this case. See 15 U.S.C. 78u-4(a)(3)(A)(i). Plaintiff states that it purchased 2,820 shares of Diodes common stock and incurred losses of $22,232. Plaintiff states that to [its] knowledge, this represents the largest financial interest in the relief sought by the class (Doc. No. 14 at 4). No other potential class members have moved for appointment as lead plaintiff. Accordingly, it is undisputed that Plaintiff has the largest financial interest within the meaning of the PSLRA. 15 U.S.C. 78u-4(a)(3)(B). Plaintiff must also make a preliminary showing of typicality and adequacy under Rule 23(a). To satisfy the typicality requirement, Plaintiff must demonstrate that its claims have the same essential characteristics of those of the putative class. Parker v. Hyperdynamics Corp., No. 4:12-CV-999, 2013 WL , at *3 (S.D. Tex. Feb. 19, 2013) (citing Stirman v. Exxon Corp., Page 3 of 6

4 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 4 of 6 PageID #: F.3d 554, 562 (5th Cir. 2002)). Plaintiff claims that typicality is satisfied because the claims asserted by Local 731 Teamsters are premised on the same legal and remedial theories and are based on the same types of misrepresentations and omissions as the class s claims (Doc. No. 14 at 6). The Court agrees. Plaintiff, on behalf of the putative class, alleges that Defendants violated the securities laws by making materially false statements and omitting material facts about Diodes during the class period. Plaintiff alleges that it, and potential class members, relied on certain of these misrepresentations and omissions to purchase Diodes stock at inflated prices, which resulted in losses. Accordingly, for purposes of this preliminary analysis, the Court finds that Plaintiff s factual and legal theories are typical of the potential members of the class. As a result, Plaintiff has made a preliminary showing of typicality under Rule 23(a). The standard for adequacy of representation under Rule 23(a)(4) is met by: (1) the absence of potential conflict between the named plaintiffs and the class members and (2) the class representatives choice of counsel who is qualified, experienced and able to vigorously conduct the proposed litigation. In re Universal Access, Inc. Sec. Litig., 209 F.R.D. 379, 386 (E.D. Tex. 2002). Plaintiff argues that its interests are aligned with the members of the class, and there is no evidence of any antagonism between Local 731 Teamsters interests and those of the other members of the class (Doc. No. 14 at 6). Plaintiff further states that it is motivated to vigorously pursue the case and that it has retained competent and experienced counsel (Doc. No. 14 at 6). The Court agrees. For purposes of this preliminary analysis, the Court finds that Plaintiff s interests are aligned with the interest of the class because they allegedly suffered from the same statements and omissions regarding Diodes s financial performance and prospects. Page 4 of 6

5 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 5 of 6 PageID #: 208 Furthermore, the Court agrees that there is no evidence of a conflict or antagonism between Plaintiff and the class. Moreover, Plaintiff has demonstrated its commitment to protect the interest of the class by commencing this action and retaining competent counsel. Accordingly, the Court finds that Plaintiff has made a preliminary showing of adequacy under Rule 23(a). In view of these findings, Plaintiff is presumed to be the most adequate plaintiff. See 15 U.S.C. 78u-4(a)(3)(B)(i). b. Appointment of Lead Counsel Plaintiff proposes that Robbins Geller Rudman & Dowd (Robbins Geller) be appointed as lead counsel and that the Ward & Smith Law Firm be appointed as liaison counsel for the class. According to Plaintiff, Robbins Geller is a 180-lawyer firm engaged in securities, consumer, and antitrust class actions (Doc. No. 14 at 7). Plaintiff contends that Robbins Geller possesses extensive experience litigating securities class actions and has successfully prosecuted numerous securities fraud class actions on behalf of injured investors (Doc. No. 14 at 7). Attached to Plaintiff s motion are the law firm résumés of Robbins Geller and Ward & Smith. In view of the record of Robbins Geller in past securities litigation, the Court finds that it is capable of protecting the interests of the class. Moreover, the Court approves of Plaintiff s selection of Ward & Smith to serve as liaison counsel. IV. CONCLUSION For the reasons set forth above, Plaintiff s motion (Doc. No. 14) is GRANTED and Plaintiff Local 731 Teamsters is appointed as lead plaintiff in this case. 2 2 In doing so, the Court expresses no opinion as to whether the class will be certified under Rule 23. Page 5 of 6

6 Case 6:13-cv MHS Document 19 Filed 06/14/13 Page 6 of 6 PageID #: 209 It is further ORDERED that Robbins Geller Rudman & Dowd is appointed as lead counsel and the Ward & Smith Law Firm is appointed as liaison counsel. It is SO ORDERED. SIGNED this 14th day of June, k aey441 MICHAEL H. SCHNEIDER UNITED STATES DISTRICT JUDGE 0 Page 6 of 6