328 F.Supp. 221 (Jud.Pan.Mult.Lit. 1971), 55, In re Four Seasons Securities Laws Litigation
|Citation:||328 F.Supp. 221|
|Party Name:||In re FOUR SEASONS SECURITIES LAWS LITIGATION.|
|Case Date:||May 26, 1971|
|Court:||United States Judicial Panel on Multidistrict Litigation|
Before JOHN MINOR WISDOM, EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER, JOSEPH S. LORD, III, and STANLEY A. WEIGEL, Judges of the Panel. [*]
OPINION AND ORDER
JOHN MINOR WISDOM, Judge of the Panel.
On its own initiative the Panel entered a show cause order in these ten actions, 1 all of which allege violations of the securities laws in connection with public offerings and private placements of the securities of Four Seasons Nursing Centers of America, Inc. (Four Seasons) and its related corporations. The principal defendants in this litigation are Four Seasons and its affiliates, the officers and directors of the companies, and Walston & Co., the principal underwriter of Four Seasons securities. Four Seasons and Four Seasons Equity Corp., one of its affiliates, are now undergoing a Chapter X Reorganization in the Western District of Oklahoma under the supervision of Judge Luther L. Bohannon.
The ten actions are pending in four different districts and assert a number of conflicting claims for class representation. Seven of the ten actions were brought on behalf of a class composed of all injured shareholders of Four Seasons. Five of these were brought in the Southern District of New York, where they were consolidated and general counsel for the plaintiffs appointed. The remaining two actions were filed in the Western District of Oklahoma and the Northern District of Illinois. Two of the remaining three actions seek representation of different and conflicting classes. In the Northern District of Ohio, the plaintiff seeks to represent all purchasers of Four Seasons and Four Seasons Equity securities at private placement while one of the New York actions seeks to represent all stockholders of Four Seasons Equity.
Virtually all of the parties responding to the Panel's order agree to the desirability of centralizing these cases for coordinated or consolidated pretrial proceedings under Section 1407. Common questions of fact arise from the common allegations concerning the defendant's false and misleading statements, their failure to disclose material facts, and their participation in transactions detrimental to the Four Seasons companies. Treatment of these cases under Section 1407 will eliminate repetitive discovery and place all conflicting class claims before one court, thus furthering the convenience of the parties and witnesses and the just and efficient conduct of the litigation. 2
The only opposition to transfer 3 comes from the plaintiff in Fink v. Johnston in the Southern District of New York, who alleges derivative claims on behalf of Four Seasons Equity and class claims on behalf of its stockholders. He contends that these claims are factually unrelated to the claims...
To continue readingFREE SIGN UP