Docket No. 1335, C.A. No. 1:02-1293
August 14, 2002
Plaintiffs in the six Southern District of Florida actions move the Panel, pursuant to Rule 7.4, R.P.J.P.M.L., 199 F.R.D. 425, 435-36 (2001), to vacate its order conditionally transferring the actions to the District of New Hampshire, a position in which plaintiffs in at least two Southern District of New York actions join. Similarly, a consortium of institutional investors seeking to be appointed lead plaintiffs ask the Panel to vacate the conditional transfer order. Instead, these movants ask the Panel to centralize the actions in the Southern District of Florida. Plaintiff in a Southern District of New York action opposes transfer of his action on the grounds that it does not share questions of fact with the other actions. Tyco International, Ltd. (Tyco) and certain of its officers and directors named as defendants in the actions oppose the motions to vacate and favor transfer of the actions to the District of New Hampshire. In the alternative, the defendants would support centralization in the Southern District of New York.
The group of institutional investors consists of the Teachers Retirement System of Louisiana, the Louisiana State Employees Retirement System, Voyageur Asset Management, Plumbers and Pipefitters National Pension Fund, United Association General Officers Pension Plan, United Association Office Employees Pension Plan, and United Association Local Union Officers Employees Pension Fund.
These entities are members of the putative classes in each of the securities actions and either have sought or plan to seek appointment as lead plaintiffs.
L. Dennis Kozlowski, Mark H. Swartz, Michael A. Ashcroft, Mark Belnick, Frank E. Walsh, Jr., Joshua M. Berman, Richard S. Bodman, John F. Fort, III, Stephen W. Foss, Wendy E. Lane, James S. Pasman, W. Peter Slusser, and Joseph F. Welch.
On the basis of the papers filed and hearing session held, the Panel finds that these 23 actions involve common questions of fact with the actions in this litigation previously transferred to the District of New Hampshire, and that transfer of these 23 actions to the District of New Hampshire for inclusion in the coordinated or consolidated pretrial proceedings in that district will serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation. The Panel further finds that transfer of these 23 actions is appropriate for reasons expressed by the Panel in its original order directing centralization in this docket. See In re Tyco International, Ltd., Securities Litigation, MDL-1335, 2000 U.S. Dist. LEXIS 5551 (J.P.M.L. Apr. 26, 2000). The Panel held that the District of New Hampshire was the proper Section 1407 forum for actions involving allegations that the defendants engaged in improper accounting practices and misrepresented the financial condition and future growth prospects of Tyco.
Plaintiffs argue that there is little or no factual overlap between the actions previously pending in the transferee district and those in the actions presently before the Panel. We disagree. We point out that transfer under Section 1407 does not require a complete identity or even majority of common factual issues as a prerequisite to transfer. Moreover, we find that the actions still arise from a common factual core, including the overall financial health of Tyco and the defendants' knowledge and disclosure of purported developments with respect to that financial outlook. The Panel also rejects any suggestion by plaintiffs that the status of proceedings in this docket limits either our authority or the transferee judge's authority under Section 1407 in this matter. See In re Crown Life Ins. Co. Premium Litig., 178 F. Supp.2d 1365, 1366 (J.P.M.L. 2001). The familiarity of the transferee judge with this docket and the underlying allegations will further the expeditious resolution of the litigation taken as a whole.
Plaintiff in one Southern District of New York action opposes transfer of his action because it is brought under the Employee Retirement Income Security Act of 1974 (ERISA), not the federal securities laws. We are not persuaded by this contention. Rather, we find that whether the actions be brought by securities holders seeking relief under the federal securities laws, shareholders suing derivatively on behalf of Tyco, or participants in retirement savings plans suing for violations of ERISA, all actions can be expected to focus on a significant number of common events, defendants, and witnesses. See In re Enron Corp. Sec., Derivative "Erisa" Litig., 196 F. Supp.2d 1375 (J.P.M.L. 2002).
IT IS THEREFORE ORDERED that, pursuant to 28 U.S.C. § 1407, these 23 actions are transferred to the District of New Hampshire and, with the consent of that court, assigned to the Honorable Paul J. Barbadoro for inclusion in the coordinated or consolidated pretrial proceedings occurring there in this docket.