Settlement Approved In Tibco Software Inc., Stockholder Litigation
In In re Tibco Software, Inc., Stockholders Litig., Consol. C.A. No. 10319-CB (Del. Ch.), the Faruqi firm and another firm supported two firms appointed as Lead Counsel in an action where Plaintiff brought an aiding and abetting claim against Goldman Sachs & Co. (“Goldman”) and a reformation claim against the buyer, Vista Equity Partners (“Vista”) in connection with a $4.2 billion sale announced in 2014. The case alleged that Goldman, after the merger agreement was executed, discovered that it had used an inaccurately inflated share count when it conducted its fairness analysis. Plaintiff recognized that the proxy statement reported a total equity value that was $100 million below the amount the parties had previously announced. Vista allegedly trimmed its initial offer by $100 million based on the error. After extensive litigation, the action settled with $30 million additional compensation going to the shareholders. The Settlement was approved on September 7, 2016.
“Ultimately this case had two key aspects: a reformation claim and an aiding and abetting claim, each of which has very significant legal challenges associated with them,” Chancellor Bouchard said. “Those are hard claims to prove.”
During the Settlement Hearing in open court on September 7, 2016, Chancellor Bouchard said that he was just 24 hours away from a decisive, but undisclosed, ruling on one of the claims, when he learned the parties settled. Thus, the action emphasizes the importance of timing when parties decide to settle. Had the parties not settled prior to the Chancellor’s decision, one of the parties would have lost significant leverage or more.
The settlement terms limit distributions to those who submit claims, so that distributions will potentially be greater than 33 percent of the damage amount if some stockholders fail to submit forms.
About Faruqi & Faruqi, LLP
Faruqi & Faruqi, LLP focuses on complex civil litigation, including securities, antitrust, wage and hour, and consumer class actions as well as shareholder derivative and merger and transactional litigation. The firm is headquartered in New York, and maintains offices in California, Delaware and Pennsylvania.
Since its founding in 1995, Faruqi & Faruqi, LLP has served as lead or co-lead counsel in numerous high-profile cases which ultimately provided significant recoveries to investors, consumers and employees.
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About James R. Banko
James R. Banko is a partner in Faruqi & Faruqi's Delaware office. Mr. Banko has substantial practice in complex litigation, including securities and corporate fraud.
Prior to joining the Firm, Mr. Banko represented sophisticated institutional investors in a high-profile securities fraud class action, In re Tyco International, Ltd. Securities Litig., which resulted in $3 billion class action settlement and in which Mr. Banko took and defended numerous depositions and wrote class certification, discovery, and summary judgment briefs. Mr. Banko was also involved in the recovery of a successful settlement against a former chief financial officer on behalf of a European fund which included discovery under the Hague Convention. Mr. Banko also took a leading role in several other securities fraud class actions against pharmaceutical companies including briefing of Daubert motions. Representative clients included various state attorney generals, pension funds, and securities funds.
Mr. Banko, while practicing with Faruqi & Faruqi, also serves as President and a member of the Board of Directors for the Swarthmore, PA Public Library.
Mr. Banko received his J.D. from the University of Pennsylvania Law School where he was a Senior Board Member of the Journal of International Business Law. Mr. Banko is admitted, and in good standing, in NY, NJ, PA, DC, DE, FL, and CA, numerous United States district courts as well as the 1st, 2d, 3d and 9th Circuits, and the U.S. Supreme Court.