Free Supplement/Amendment - District Court of Colorado - Colorado

Case 1:04-cv-01030-WDM

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 04-cv-01030-WDM-CBS NOBLE ASSET MANAGEMENT LLC, on behalf of itself and all others similarly situated, Plaintiff, v. ALLOS THERAPEUTICS, INC., and MICHAEL E. HART, Defendants.

SUPPLEMENT TO PLAINTIFFS' RENEWED UNOPPOSED MOTION FOR PRELIMINARY APPROVAL OF SETTLEMENT

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INTRODUCTION Pursuant to the Court's August 14, 2008 Order [Docket No. 68], the parties were directed to submit: (1) "An appropriate pleading representing the parties' summary or definition of the

class claims, issues or defenses pursuant to Fed. R. Civ. P. 23(c)(1)(B);" and (2) "A request for appointment of counsel pursuant to Fed. R. Civ. P. 23(c)(1)(B) and

(g) which provides reasons why the designated counsel should be appointed and what the maximum amount of counsel's fee claim will be." In response to the Court's request, Plaintiffs submit this Supplement to their Renewed Unopposed Motion for Preliminary Approval of Settlement [Docket No. 66]. 1. THE CLASS CLAIMS TO BE CERTIFIED & THE DEFENSES RAISED Fed. R. Civ. P. 23(c)(1)(B) provides: "an order that certifies a class action must define the class 1 , and the class claims, issues, or defenses, and must appoint class counsel under Rule 23 (g)." The parties here define and summarize the class claims for which they seek class treatment in connection with the proposed settlement as follows: all claims that investors were damaged by purchasing Allos common stock during the Class Period at prices artificially inflated as a result of Defendants' alleged dissemination of materially false and misleading statements regarding Allos, in violation of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Rule 10b-5 thereunder. Plaintiffs have previously proposed that the class be defined as "all persons who purchased the common stock of Allos Therapeutics, Inc. ("Allos") between May 29, 2003 and April 29, 2004, inclusive [the "Class Period"], and who were damaged thereby." See [Proposed] Preliminary Order For Notice And Hearing In Connection With Settlement Proceedings [Docket No. 60, Attachment 1], at paragraph 2. -21

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Submitted herewith is a revised proposed Order including the foregoing definition/summary of the class claims in paragraph 3. The foregoing definition/summary is based upon the claims asserted in Plaintiffs' First Amended Class Action Complaint for Violations of Federal Securities Laws filed on August 25, 2004 (the "Complaint") [Docket No. 31]. Specifically, the Complaint alleged that Defendants misled investors about the prospects for RSR13, a drug candidate in development by Allos designed to improve cancer treatments. RSR13 is a synthetic small molecule designed to increase the level of oxygen in tumor cells for the purpose of increasing the effectiveness of Whole Brain Radiation Treatment (WBRT). WBRT is a standard treatment for brain metastases (that is, cancer spread to the brain from another primary cancer site). Pharmaceutical products sold in the United States must be approved by the U.S. Food and Drug Administration (FDA). Clinical trials demonstrating safety and efficacy are required for FDA approval of any new drug product. These trials are conducted in three phases. In early 2003, Allos completed Phase 3 testing of the effect RSR13 in combination with WBRT. On April 23, 2003, Allos issued a press release announcing the results of its clinical trials of RSR13. The April 23, 2003 press release stated that the tests did not show that the use of RSR13 resulted in a statistically significant survival advantage in the overall test group, but that the data did show a statistically significant survival benefit for patients with metastatic breast cancer. Allos' stock price fell following this announcement. On May 29, 2003, the start of the Class Period, Allos announced that it would proceed with a new drug application for RSR13 as treatment for metastatic breast cancer. On May 29,

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2003, the price of Allos common stock closed at $3.75 per share, an increase of $1.40 per share (a 60% gain). On April 30, 2004, the FDA released a briefing stating the opinion of the FDA staff that the "evidence submitted in this application is not convincing and does not support [Allos'] claim of efficacy." On April 30, 2004, the price of Allos common stock fell to $2.55 per share, from its price of $4.64 per share on the previous day. (Complaint, ¶ 87). The last day of the Class Period is April 29, 2004. Plaintiffs allege that the claims against Defendants for violations of the federal securities laws are common to all Class Members. Plaintiffs assert that common questions of law and fact exist as to, among other things: (a) whether the federal securities laws were violated by Defendants' actions; (b) whether statements made by the Defendants to the investing public during the Class Period misrepresented material facts about the business and operations of Allos; and (c) to what extent members of the Class have sustained damages and the proper measure of damages. (Complaint, ¶ 32). Defendants believe all claims are meritless principally for the reasons in Judge Matsch's October 20, 2005 order dismissing the action with prejudice. If the matter were to proceed and the Tenth Circuit to reverse the dismissal, Defendants believe that at least the following defenses would prevail: (1) that Allos' public disclosures during the Class Period were not false and misleading; (2) that the alleged misleading statements in Allos' public disclosures were not material within the meaning of federal securities law; (3) that Defendants did not act with the requisite scienter; and (4) that Plaintiffs cannot establish that any of their claimed losses (or those of the Class) were caused by Defendants' conduct.

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2.

PLAINTIFFS' COUNSEL SHOULD BE APPOINTED AS CLASS COUNSEL In connection with the proposed settlement, Plaintiffs further request that the Court

appoint Milberg LLP as lead counsel for the Class and appoint Dyer & Berens LLP as liaison class counsel. Fed. R. Civ. P. 23(g) provides: (g) Class Counsel. (1) Appointing Class Counsel. Unless a statute provides otherwise, a court that certifies a class must appoint class counsel. In appointing class counsel, the court: (A) must consider: (i) the work counsel has done in identifying or investigating potential claims in the action; (ii) counsel's experience in handling class actions, other complex litigation, and the types of claims asserted in the action; (iii) counsel's knowledge of the applicable law; and (iv) the resources that counsel will commit to representing the class; (B) may consider any other matter pertinent to counsel's ability to fairly and adequately represent the interests of the class; (C) may order potential class counsel to provide information on any subject pertinent to the appointment and to propose terms for attorney's fees or nontaxable costs; (D) may include in the appointing order provisions about the award of attorney's fees or nontaxable costs under Rule 23(h); and (E) may make further orders in connection with the appointment. (2) Standard for Appointing Class Counsel. When one applicant seeks appointment as class counsel, the court may appoint that applicant only if the applicant is adequate under Rule 23(g)(1) and (4). If more than one adequate applicant seeks appointment, the court must appoint the applicant best able to represent the interests of the class. (3) Interim Counsel. The court may designate interim counsel to act on behalf of a putative class before determining whether to certify the action as a class action. (4) Duty of Class Counsel. Class counsel must fairly and adequately represent the interests of the class.

Here, the proposed class counsel, Milberg LLP and Dyer & Berens LLP, have already done extensive work in identifying and investigating the potential claims of the class, have filed a First Amended Class Action Complaint for Violations of Federal Securities Laws, defended

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against the motion to dismiss and taken an appeal of the dismissal. Clearly consideration of factor 23(g)(1)(A)(i) supports appointing movants as class counsel. The proposed class counsel, Milberg LLP and Dyer & Berens LLP, also have significant experience in handling shareholder class actions brought under the Securities Exchange Act of 1934 and have successfully litigated numerous such class actions in Colorado and throughout the country. See, e.g., www.Milberg.com & www.DyerBerens.com. Consideration of the experience and knowledge factors of Rule 23(g)(1)(A)(ii) and (iii) strongly supports appointing movants as class counsel. Additionally, these firms have diligently litigated this case. They conducted an extensive investigation relating to the claims and the underlying events and transactions alleged in the Complaint, and have analyzed the evidence adduced during their investigation and have researched the applicable law with respect to the claims of Plaintiffs and the Class against the Defendants and the potential defenses thereto. They have expended considerable time and effort in the prosecution of this litigation on a contingent fee basis, and have advanced the expenses of the litigation. Consideration of the Rule 23(g)(1)(A)(iv) factor concerning the resources that counsel will commit to representing the class also strongly supports appointing movants as class counsel. Finally, the proposed Notice to the Class states that Plaintiffs' Counsel will move the Court to award attorneys' fees from the Gross Settlement Fund in an amount not greater than one-third (33%) of the Gross Settlement Fund and for reimbursement of their expenses in the approximate amount of $45,000, plus interest on such expenses at the same rate as earned by the Settlement Fund.

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CONCLUSION Plaintiffs respectfully request that the Court grant approval of the unopposed motion for an order preliminarily approving the proposed settlement and enter the proposed Preliminary Order For Notice And Hearing In Connection With Settlement Proceedings, submitted herewith. DATED: August 25, 2008 s/ Jeffrey A. Berens Robert J. Dyer III Jeffrey A. Berens Darby K. Kennedy DYER & BERENS LLP 682 Grant Street Denver, CO 80203-3507 Telephone: (303) 861-1764 FAX: (303) 395-0393 Email: [email protected] Email: [email protected] Email: [email protected] Jeff S. Westerman MILBERG LLP One California Plaza 300 S. Grand Ave., Suite 3900 Los Angeles, CA 90071 Telephone: (213) 617-1200 FAX: (213) 617-1975 Email: [email protected] Michael A. Swick LAW OFFICES OF MICHAEL A. SWICK, PLLC One William Street, Suite 900 New York, NY 10004 Telephone: (212) 584-0770 FAX: (212) 584-0799 Email: [email protected] Counsel for Plaintiffs

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CERTIFICATE OF SERVICE
I hereby certify that on August 25, 2008, I electronically filed the foregoing SUPPLEMENT TO PLAINTIFFS' RENEWED UNOPPOSED MOTION FOR

PRELIMINARY APPROVAL OF SETTLEMENT with [PROPOSED] PRELIMINARY ORDER FOR NOTICE AND HEARING IN CONNECTION WITH SETTLEMENT PROCEEDINGS with the Clerk of Court using the CM/ECF system, which will send notification of such filing to the following e-mail addresses:
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Paul H. Schwartz [email protected],[email protected],[email protected], [email protected],[email protected]

and I hereby certify that I served the document with a copy of the Notice of Electronic Filing by depositing the same in the United States mail, first-class postage prepaid on the following nonCM/ECF participants: Jeff S. Westerman MILBERG LLP One California Plaza 300 S. Grand Ave., Suite 3900 Los Angeles, CA 90071 Michael A. Swick LAW OFFICES OF MICHAEL A. SWICK, PLLC One William Street, Suite 900 New York, NY 10004

s/ Jeffrey A. Berens Jeffrey A. Berens Attorney for Plaintiffs DYER & BERENS LLP 682 Grant Street Denver, CO 80203-3507 Telephone: (303) 861-1764 FAX: (303) 395-0393 Email: [email protected]

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