Update: The Final Approval Hearing date has been delayed. The Final Approval Hearing has now been set to August 20, 2010 at 9:45 am.
The purpose of this Website is to let you know that the class action lawsuit entitled Mahbod Mofidi v. Alan J. Levy, et al., pending in the Superior Court of Washington for King County (the “Court”), Case No. 08-2-23777-0 SEA (the “Lawsuit”) has been conditionally certified as a class action for the sole purpose of obtaining the Court’s approval of a settlement of the Lawsuit (the “Settlement”). This Website is intended to advise you of your rights with respect to the Settlement and to inform you of the scheduling of a hearing by the Court to determine whether to approve the Settlement. You have a right to attend the hearing, which will be held on August 20, 2010 at 9:45 am before the Court located at 516 3rd Avenue, Seattle, Washington. This Website is not an expression of any opinion by the Court as to the merits of any of the claims or defenses asserted by any party in the Lawsuit. The Court has not formed any opinions concerning the merits of the lawsuit, and the Court has not determined that Northstar Neuroscience, Inc. (“Northstar”) or any of the defendants in the Lawsuit have done anything wrong.
SUMMARY OF SETTLEMENT
- The plaintiff in the Lawsuit is Mahbod Mofidi (the “Plaintiff”). The Plaintiff alleges, among other claims, that the Defendants breached their fiduciary duties by (i) allegedly failing to properly consider two alleged offers to purchase Northstar, and (ii) allegedly ignoring, or failing to protect against, alleged conflicts of interests. Plaintiff also alleges that the registration statement for Northstar’s Initial Public Offering (the “IPO”) contained false and misleading statements.
- Plaintiff asserts that the Lawsuit caused Northstar’s Board of Directors to consider and approve a Plan Of Complete Liquidation And Dissolution (the “Liquidation Plan”). Plaintiff, thus, contends that the substantial distribution to Northstar’s shareholders pursuant to the Liquidation Plan, which is expected to be between $51.11 million and $56.11 million, is the result of the Lawsuit.
- The Defendants in the Lawsuit are Alan J. Levy, John S. Bowers Jr., Susan K. Barnes, Michael D. Ellwein, Albert J. Graf, Robert E. McNamara, Dale A. Spencer, and Carol D. Winslow (collectively, the “Defendants”). The Defendants deny all of the Plaintiff’s allegations and while the Defendants believe it unlikely that the Plaintiff could succeed in the Lawsuit, the Defendants have agreed to settle the Lawsuit, among other reasons, in order to avoid the further expense, inconvenience, burden, and distractions of continued litigation.
- Although Defendants deny that Plaintiff’s Lawsuit caused, or influenced in any way whatsoever the chain of events resulting in, the Liquidation Plan, Plaintiff and Plaintiff’s Counsel have a number of arguments, which, if adopted by the Court, could dramatically increase the fees and costs borne by shareholders, resulting in additional delay. Accordingly, because the Parties have agreed, subject to final approval by the Court, to a settlement of the Lawsuit, the Liquidation Plan can proceed without the uncertainties and expenses of, or potential delays or interruptions resulting from, litigation.
- You are a member of the settlement class if you held any interest in Northstar stock, either of record or beneficially, and including their successors-in-interest and transferees (other than Defendants and their affiliates) as of the close of business on April 16, 2009 (the “Class”), which was the record date of the special meeting of the shareholders of Northstar to consider and vote upon the proposal to approve the voluntary dissolution and liquidation of Northstar pursuant to the Liquidation Plan.
- The Plaintiff and his counsel support the Settlement.
SUMMARY OF YOUR RIGHTS AND OPTIONS UNDER THE SETTLEMENT
- DO NOTHING
If you do nothing, you will be included as a Settlement Class Member. As a Settlement Class Member, you give up any right to sue any of the Defendants or the Released Persons for any of the Settled Claims.
- OBJECT OR COMMENT
Write to the Court about why you support or oppose the Settlement.
- GO TO A HEARING
Ask to speak in Court about the fairness of the Settlement. Your legal rights are affected even if you do not act. Download and carefully read the full notice by clicking here.