Free Reply to Response to Motion - District Court of California - California

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REED R. KATHREIN (139304) HAGENS BERMAN SOBOL SHAPIRO LLP 715 Hearst Avenue, Suite 202 Berkeley, CA 94710 Telephone: (510) 725-3000 Facsimile: (510) 725-3001 [email protected] LEWIS S. KAHN KAHN GAUTHIER SWICK, LLC 650 Poydras Street, Suite 2150 New Orleans, LA 70130 Telephone: (504) 455-1400 Facsimile: (504) 455-1498 [email protected] Attorneys for Plaintiffs [Additional counsel listed on signature page] UNITED STATES DISTRICT COURT

12 NORTHERN DISTRICT OF CALIFORNIA 13 OAKLAND DIVISION 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BIKASH MOHAN MOHANTY, On Behalf of ) Himself and All Others Similarly Situated, ) ) Plaintiff, ) ) vs. ) ) BIGBAND NETWORKS, INC., AMIR ) BASSAN-ESKENAZI, RAN OZ, FREDERICK ) BALL, GAL ISRAELY, DEAN GILBERT, ) KEN GOLDMAN, LLOYD CARNEY, BRUCE ) SACHS, ROBERT SACHS, GEOFFREY ) YANG, MORGAN STANLEY & CO., INC., ) MERRILL LYNCH, PIERCE, FENNER & ) SMITH, INC., JEFFERIES & CO., INC., ) COWEN AND CO., INC., AND ) THINKEQUITY PARTNERS, LLC ) ) Defendants. ) ) Case No. 3:07-CV-05101-SBA CLASS ACTION REPLY IN SUPPORT OF GWYN JONES' MOTION TO APPOINT LEAD PLAINTIFF AND IN RESPONSE TO SPHERA FUND'S OPPOSITION TO JONES' MOTION DATE: February 5, 2008 TIME: 1:00 P.M. DEPT: Courtroom 3, 3rd Floor

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DENNIS KOESTERER, On Behalf of Himself and ) All Others Similarly Situated, ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR BASSAN- ) ESKENAZI, FREDERICK A. BALL, RAN OZ, ) LLOYD CARNEY, DEAN GILBERT, KEN ) GOLDMAN, GAL ISRAELY, BRUCH SACHS, ) ROBERT SACHS, and GEOFFREY YANG ) ) Defendants. ) ) ABRENA WINSTON, Individually and On ) Behalf of All Others Similarly Situated, ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR ) BASSAN-ESKENAZI, RAN OZ, FREDERICK ) BALL, GAL ISRAELY, DEAN GILBERT, KEN ) GOLDMAN, LLOYD CARNEY, BRUCE ) SACHS, ROBERT SACHS, GEOFFREY ) YANG, MERRILL LYNCH, PIERCE, FENNER ) & SMITH, INC., MORGAN STANLEY & CO., ) INC., COWEN AND CO., JEFFERIES & CO., ) and THINKEQUITY PARTNERS, LLC ) ) Defendants. ) ) DONALD SMITH, On Behalf of Himself and All ) Others Similarly Situated, ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR ) BASSAN-ESKENAZI, and FREDERICK A. ) BALL ) ) Defendants. ) )

Case No. 3:07-CV-05168-MMC

Case No. 3:07-CV-05327-JSW

Case No. 3:07-CV-05361-SI

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WAYNE LUZON, On Behalf of Himself and All Others Similarly Situated,

) ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR BASSAN- ) ESKENAZI, RAN OZ, FREDERICK BALL, GAL ) ISRAELY, DEAN GILBERT, KEN GOLDMAN, ) LLOYD CARNEY, BRUCE SACHS, ROBERT ) SACHS, GEOFFREY YANG, MORGAN ) STANLEY & CO., INC., MERRILL LYNCH, ) PIERCE, FENNER & SMITH, INC., JEFFERIES & ) CO., INC., COWEN AND CO., INC., and ) THINKEQUITY PARTNERS, LLC ) ) Defendants. ) ) DEBRA L. BERNSTEIN, Individually and On ) Behalf of All Others Similarly Situated, ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR BASSAN- ) ESKENAZI, RAN OZ, FREDERICK A. BALL, ) GAL ISRAELY, DEAN GILBERT, KENNETH A. ) GOLDMAN, LLOYD CARNEY, BRUCE I. ) SACHS, ROBERT J. SACHS, GEOFFREY Y. ) YANG, MORGAN STANLEY & CO., ) INCORPORATED, JEFFERIES & COMPANY, ) INC., MERRILL LYNCH, PIERCE FENNER & ) SMITH INCORPORATED, COWEN AND ) COMPANY, LLC and THINKEQUITY ) PARTNERS LLC, ) ) Defendants. ) ) EUGENE HAMMER, On Behalf of Himself and ) All Others Similarly Situated, ) ) Plaintiff, ) ) v. ) ) BIGBAND NETWORKS, INC., AMIR BASSAN- ) ESKENAZI, FREDERICK A. BALL, RAN OZ, ) LLOYD CARNEY, DEAN GILBERT, KEN ) GOLDMAN, GAL ISRAELY, BRUCE SACHS, ) ROBERT SACHS, and GEOFFREY YANG ) ) Defendants. ) )
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Case No. 3:07-CV-05637-WHA

Case No. 3:07-CV-05825-MHP

Case No. 3:07-CV-05825-MHP

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I.

INTRODUCTION

Movant Sphera Fund Management, Ltd. ("Sphera Fund") concedes that Gwyn Jones ("Mr. Jones") suffered the largest loss of anyone seeking to serve as Lead Plaintiff in these cases alleging that Defendants engaged in conduct that violates federal securities laws. The Ninth Circuit is clear that the movant with the largest loss and who otherwise meets the adequacy and typicality requirements of Federal Rule of Civil Procedure 23(a) ("Rule 23"), is the "presumptively most adequate plaintiff." In re Cavanaugh, 306 F.3d 726, 730 (9th Cir. 2002) ("the `presumptively most adequate plaintiff' ­ and hence the presumptive lead plaintiff ­ (is) the one who `has the largest financial interest in the relief sought by the class' and `otherwise satisfies the requirements of Rule 23.'"). Once the presumptive Lead Plaintiff is selected, the Ninth Circuit permits the "other plaintiffs an opportunity to rebut the presumptive lead plaintiff's showing that it satisfies Rule 23's typicality and adequacy requirements." Id. Here, Mr. Jones suffered the largest loss of any movant and he satisfies the requirements of Rule 23. Therefore, Mr. Jones is presumptively the most adequate Lead Plaintiff. The Sphera Fund has failed to rebut that presumption. It has not introduced any evidence to rebut Mr. Jones' showing that he should be appointed Lead Plaintiff in this case. See Cavanaugh, 306 F.3d at 732 ("Once it determines which plaintiff has the biggest stake, the court must appoint that plaintiff as lead unless it finds that he does not satisfy the typicality or adequacy requirements."). Based on the "information provided in his pleadings and declarations," id. at 730, Mr. Jones' adequacy and typicality cannot be challenged and his motion to be appointed as Lead Plaintiff should be granted. Mr. Jones is a sophisticated investor whose work experience includes service as senior management and as a member of the board of directors of several corporations. Mr. Jones' claims are typical of other class members who purchased shares of Bigband Networks, Inc. stock and Mr. Jones has selected counsel, the law firms of Hagens Berman Sobol Shapiro LLP and Kahn Gauthier Swick, LLC, that are experienced securities litigators capable of vigorously prosecuting this litigation with Mr. Jones at the helm. Moreover, consistent with Cavanaugh and its progeny, the Sphera Fund's argument that institutional investors are the "better selection" as lead plaintiff, or its alternative argument that its REPLY ISO GWYN JONES' MOT. TO APPOINT LEAD PL. AND - 1 IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­ NO. C 07-05101 SBA

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status as an institutional investor warrants its appointment as a co-lead plaintiff in this case, should be rejected. See Tanne v. Autobytel, 226 F.R.D. 659, 672-673 (C.D. Cal. 2005) (finding no "controlling Ninth Circuit precedent" supports the argument that an institution should be appointed lead or co-lead plaintiff simply because it is an institution.) II. MR. JONES HAS THE LARGEST FINANCIAL INTEREST IN THE RELIEF SOUGHT BY THE CLASS, AND IS PRESUMPTIVELY THE MOST ADEQUATE PLAINTIFF The Ninth Circuit has held that the Private Securities Litigation Reform Act of 1995 ("PSLRA") "provides a simple three-step process for identifying the lead plaintiff" in a case like this one. Cavanaugh, 306 F.3d at 729. "The first step consists of publicizing the pendency of the action, the claims made and the purported class period." Id. "In step two, the district court must consider the losses allegedly suffered by the various plaintiffs before selecting the `presumptively most adequate plaintiff' ­ and hence the presumptive lead plaintiff ­ the one who `has the largest financial interest in the relief sought by the class' and `otherwise satisfies the requirements of Rule 23.'" Id., at 729-730. The Cavanaugh Court continued: In other words, the district court must compare the financial stakes of the various plaintiffs and determine which one has the most to gain from the lawsuit. It must then focus its attention on that plaintiff and determine, based on the information he has provided in his pleadings and declarations, whether he satisfies the requirements of Rule 23(a) . . . . If the plaintiff with the largest financial stake in the controversy provides information that satisfies these requirements, he becomes the presumptively most adequate plaintiff. Id., at 730. (emphasis in original). Finally, the Cavanaugh Court stated that "(t)he third step of the

20 process is to give other plaintiffs an opportunity to rebut the presumptive lead plaintiff's showing 21 that it satisfies Rule 23(a)'s typicality and adequacy requirements." Id. 22 Neither Mr. Jones nor the Sphera Fund contest the adequacy of the notice of pendency 23 24 the Sphera Fund agree that Mr. Jones suffered the greatest financial loss of any movant seeking 25 26 27 28
1 Defendants' take no position on the issue of who should be appointed Lead Plaintiff and do not contest the adequacy of the published notice. (Bigband Defendants' Response to Motions for Consolidation, Appointment As Lead Plaintiff, and Approval of Selection of Lead Counsel, filed on January 15, 2008, [Dkt. No. 33]).
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under step one of the Cavanaugh test. 1 As to the second part of the Cavanaugh test, Mr. Jones and

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appointment as lead plaintiff. (Memorandum of Law in Further Support of Motion of Sphera Fund for Appointment As Lead Plaintiff and Approval of Selection of Co-Lead Counsel, filed January 15, 2008, ("Sphera Fund Opp.") at 1, [Dkt. No. 35]). ("(i) Sphera Fund . . . with losses of $374,889.61; and (ii) Gwyn Jones . . . with reported losses of $438,617.74."), 2 see also, Tanne, 226 F.R.D. at 666 ("The PSLRA "provides in categorical terms that the only basis on which a court may compare plaintiffs competing to serve as lead is the size of their financial stake in the controversy") (emphasis in original). Having established that he suffered the greatest financial loss of any movant, the Court must consider whether Mr. Jones also satisfies the typicality and adequacy requirements of Rule 23(a). As noted in his Motion to Consolidate and Appoint Lead Plaintiff, Mr. Jones satisfies the requirements of Rule 23(a). Mr. Jones' interests are typical of the other Class Members because he, like the other Class Members, purchased the Defendants' stock "in reliance on the company's alleged misrepresentations or omissions." Tanne, 226 F.R.D. at 668, see also, Mr. Jones' Notice of Motion and Motion to Consolidate, to Appoint Gwyn Jones Lead Plaintiff and to Approve Proposed Lead Plaintiff's Selection of Counsel; Memorandum of Points and Authorities in Support Thereof at 8-10, Sec. 4, [Dkt. No. 12]. Mr. Jones is also an adequate representative because "he has suffered the greatest financial loss, ensuring vigorous advocacy." Tanne, 226 F.R.D. at 668. Mr. Jones further demonstrated his ability to adequately represent members of the class by complying with the PSLRA's requirement that he submit a certification declaring his willingness to serve as a representative. Id., see also, Declaration of Reed R. Kathrein in Support of the Motion to Consolidate, to Appoint Gwyn Jones Lead Plaintiff and to Approve Proposed Lead Plaintiff's Selection of Counsel, filed December 3, 2008 ("Kathrein Decl.), at Ex. A [Dkt. No. 13]. Moreover, Mr. Jones is a sophisticated investor, whose experience includes senior management
2 The Sphera Fund also concedes this fact in a more subtle way throughout its pleadings as it changes its reference to its losses from "the largest financial interest" in its opening brief (Notice of Motion and Motion of Sphera Fund for Consolidation of Related Actions, Appointment as Lead Plaintiff and Approval of Lead Plaintiff's Selection of Co-Lead Counsel; Memorandum of Points and Authorities in Support Thereof, filed December 3, 2007, ("Sphera Fund Motion.") at 7, Sec. B(2), [Dkt. No. 15]) to a "substantial financial interest," or a "substantial financial loss" in its opposition. Sphera Fund Opp. at 1. REPLY ISO GWYN JONES' MOT. TO APPOINT LEAD PL. AND - 3 IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­ NO. C 07-05101 SBA

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positions and board directorships. See, Declaration of Reed Kathrein in Support of Gwyn Jones' Reply to the Sphera Fund's Opposition to His Motion to Appoint Lead Plaintiff, filed concurrently herewith, Ex. A. ("Supp. Decl. Reed R. Kathrein"). Thus, under the PLSRA, Mr. Jones is presumed the most adequate movant to serve as Lead Plaintiff in this case. III. SPHERA FUND FAILS TO REBUT THE PRESUMPTION THAT MR. JONES IS THE MOST ADEQUATE PLAINTIFF In determining whether the proposed lead plaintiff satisfies the adequacy and typicality

7 prongs of Rule 23, the court focuses its attention on the proposed Lead Plaintiff's pleadings and 8 declarations. Thus, the Sphera Funds' argument in its opposition papers that Mr. Jones' "ability 9 and qualifications to be lead plaintiff . . . are unknown", and that Mr. Jones is a "blank slate" who 10 has not shown the "bona fides" necessary to serve as Lead Plaintiff in "nothing more than a cookie11 cutter certification" fails to consider the information set forth in Mr. Jones opposition papers and in 12 his curriculum vitae submitted in connection with these reply papers. (Sphera Fund Opp. at 7-8) 13 (emphasis in original) . 14 As set forth in his opposition papers, Mr. Jones' is "a sophisticated investor and has served 15 on the board of directors of both privately held and NASDAQ listed companies, and also lectured 16 in e-commerce and entrepreneurship at several United Kingdom universities." (Gwyn Jones' 17 Opposition to the Motion of the Sphera Fund to Appoint Lead Plaintiff, filed January 15, 2008, 18 ("Gwyn Jones Opp.") at 1 [Dkt. No. 31]). For example, and as detailed in Mr. Jones' curriculum 19 vitae, he served as a Director of eCleanUK, a privately held on-line cleaning service; as the CMO 20 of HumanConcepts, a privately held computer software provider; as a Vice President of VistaPrint, 21 a publically held on-line printing service; as an Executive Vice President of Software Publishing 22 Corp., a publically held computer software company; as CEO and Director of Serif, a privately 23 held computer software company; and as CEO and Director of LaserMaker, a privately held 24 printing company. See Supp. Decl. Reed R. Kathrein, Ex. A. In addition, he has several academic 25 degrees in business and he has lectured at the University of California, Berkeley and at the 26 University of Portsmouth, United Kingdom. Id. Accordingly, Mr. Jones is well qualified to 27 understand and fulfill the role of Lead Plaintiff in this the litigation. See also, Tanne 226 F.R.D. at 28
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668 (finding the presumptive lead plaintiff met the Rule 23(a) adequacy requirement because he suffered the greatest financial loss; represented that he was committed to the prosecution of the case; submitted a certification detailing his purchases; stated his willingness to serve as Lead Plaintiff; held a degree in physics; and had impressive professional experiences that made him "comfortable overseeing large projects and meeting deadlines.") Thus, given his extensive professional experience, Mr. Jones is very well-qualified to be appointed Lead Plaintiff in this case. IV. THE SPHERA FUNDS' ARGUMENT THAT AS AN INSTITUTIONAL INVESTOR IT IS PREFERRED AND WILL MAKE A "BETTER" LEAD PLAINTIFF OR, IN THE ALTERNATIVE, THAT IT SHOULD BE APPOINTED AS CO-LEAD PLAINTIFF IS CONTRARY TO NINTH CIRCUIT PRECEDENT Sphera Fund asks the Court to ignore the PSLRA's mandate that the most adequate Lead

10 Plaitniff is the investor with the largest loss and who satisfies Rule 23(a). Instead, Sphera Fund 11 contends that its status as an institutional investors makes it a "better selection" as lead plaintiff in 12 this case. (Sphera Fund Opp. at 3-10). This contention ignores the well-settled law that once the 13 presumption of the most adequate plaintiff "is triggered, the question is not whether another 14 movant might do a better job of protecting the interests of the class than the presumptive lead 15 plaintiff; instead the question is whether anyone can prove that the presumptive lead plaintiff will 16 not do a fair and adequate job." Tanne, 226 F.R.D. at 669. 17 In Tanne, a case decided after the Ninth Circuit's decision in Cavanaugh, the presumptively 18 most adequate plaintiff who had the largest financial interest in the case was an individual investor 19 named Gary Kurtz ("Kurtz"). One of the other movants competing with Kurtz for appointment as 20 Lead Plaintiff was an institutional investor, NJS Advisors, Inc. ("NJS"). Id. at 666. In that case, 21 Kurtz had the largest financial stake in the litigation and was otherwise found to be adequate based 22 on his willingness to serve as Lead Plaintiff, his degree in physics, and his position as a materials 23 engineer overseeing major projects. Id., at 668. Applying Cavanaugh, the court refused to 24 overturn the presumption that the most adequate plaintiff was the movant who had the largest 25 financial interest in the case; Kurtz. In addressing the challenge to Kurtz by NJS the court stated: 26 27 28 NJS contends that it should be lead plaintiff because it is the only institutional investor seeking appointment, and thus is the plaintiff `most capable of adequately representing the interests of class members.' (citation omitted) While the words `most capable' seem REPLY ISO GWYN JONES' MOT. TO APPOINT LEAD PL. AND - 5 IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­ NO. C 07-05101 SBA

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to suggest that the district court will engage in a wide-ranging comparison to determine which plaintiff is best suited to represent the class, the statute defines the term much more narrowly: The `most capable plaintiff' ­ and hence the lead plaintiff ­ is the one who `has the greatest financial stake in the outcome of the case, so long as he meets the requirements of Rule 23.' Cavanaugh, supra, 306 F.3d at 729. Although the PSLRA was enacted to encourage institutional investors to take a more active role in securities litigation, the Ninth Circuit has held that it does not `require[] the district court to select the plaintiff it believes is the most sophisticated investor available.' Id. at 737. As a consequence, there is no per se rule requiring that an institutional investor be appointed lead plaintiff in lieu of an individual who has a larger stake in the litigation. Id. at 670. 3 See also, Cavanaugh, 306 F.3d at 737, n.20 ("If financial sophistication had been Congress' principal concern, it would not have made the plaintiff who lost the most money the

10 presumptive lead plaintiff"); Steiner v. Aurora Foods Inc., No. C 00-602, 2000 U.S. Dist. Lexis 11 20341, *3 (N.D. Cal. June 5, 2000) (holding that "the PSLRA does not limit the presumption of 12 most adequate plaintiff to institutional investors. Rather, the statute merely provides that the 13 person or group of persons with the largest financial interest in the relief sought by the class is 14 entitled to the presumption of most adequate plaintiff" (citations omitted); In re Telxon Corp. Sec. 15 Litig., 67 F. Supp. 2d 803, 821 (N.D. Ohio 1999) ("The institutional investor is not presumptively 16 the most adequate plaintiff solely by virtue of its status as an institutional investor.") 17 In this case, as in the Tanne case, the institutional investor asserts that it is a more adequate 18 Lead Plaintiff because it is an experienced fiduciary and has substantial resources to oversee the 19 20 21 22 23 24 25 26 27 28
3 The Sphera Fund also relies on Bowman v. Legato Sys., Inc., 195 F.R.D. 655, 658 (N.D. Cal. 2000) and In re Critical Path, Inc. Sec. Litig., 156 F. Supp. 2d 1102, 112 (N.D.Cal. 2001) to argue that courts routinely choose institutional investors over individual investors. (Sphera Fund Opp. at 5-6). This reliance is misplaced because (1) both of those cases pre-date Cavanaugh and "appear to be fundamentally at odds with Cavanaugh's interpretation of the PSLRA," Tanne, 226 F.R.D. at 673, and (2) both of those cases rejected the individual investors for reasons other than their status as merely individual investors. Bowman, 195 F.R.D. at 657-658 (appointing an institutional investor as lead plaintiff and rejecting an aggregate group of individual investors who "had no pre-existing relationship . . . [and] appeared[ed] to be hand-picked by the [lawyers] for the sole purpose of obtaining lead plaintiff status"); In re Critical Path, 156 F. Supp. 2d at 1110-1113 (appointing an institutional investor as lead plaintiff and rejecting an individual family trust who was inadequate "because of the manner in which it acquired its shares" and rejecting other groups of investors because it "considers the existence of a preexisting relationship to be paramount in determining whether to accept a group."). REPLY ISO GWYN JONES' MOT. TO APPOINT LEAD PL. AND - 6 IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­ NO. C 07-05101 SBA

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litigation. (Sphera Fund Opp. at 5-6). This argument must fail. "So long as the plaintiff with the largest losses satisfies the typicality and adequacy requirements, he is entitled to lead plaintiff status, even if the district court is convinced that some other plaintiff would do a better job." Cavanaugh, 306 F.3d at 732; see also id. at 739 (holding that the Reform Act was not meant to "authorize the district court to select as lead plaintiff the most sophisticated investor available"); Ferrari v. Gisch, 225 F.R.D. 599, 610 (C.D. Cal. 2004) ("Although the court may compare putative lead plaintiffs when assessing financial stake, once the statutory presumption has attached, it cannot be rebutted through relative comparison.") Recognizing the inadequacy of its contention that its status as an institutional investor overcomes the presumption in favor of Mr. Jones serving as Lead Plaintiff, Sphera Fund makes a last-ditched alternative argument, that the Court should appoint it Co-Lead Plaintiff "to ensure that the litigation proceeds with speed and efficiency, and [so] that the interest of the class are adequately protected." (Sphera Fund Opp. at 10). This argument is unsupported by Ninth Circuit precedent or the PSLRA. As fully discussed above and in Mr. Jones' previous filings, not only is Mr. Jones the movant with the largest financial loss in the action and a sophisticated investor who has bona fide experience and a significant personal interest in this case, there is just no authority in the PSLRA or precedent in the Ninth Circuit that supports the argument that an institution should be appointed lead or Co-Lead Plaintiff simply because it is an institution. Tanne, 226 F.R.D. at 672. Indeed, the two cases relied upon by the Sphera Fund in their plea to be appointed co-lead plaintiff, In re Oxford Health Plans, Inc. Sec. Litig., 182 F.R.D. 42 (S.D.N.Y. 1998) and In re Cable & Wireless. PLC Sec. Litig., 217 F.R.D. 372 (E.D. Va. 2003) were rejected by the court in Tanne as "fundamentally at odds with Cavanaugh's interpretation of the PSLRA and its outlining of the process to be used in identifying a lead plaintiff." Tanne, 226 F.R.D. at 673. Just as in Tanne, the institutional investor here has not shown that the appointment of Co-Lead Plaintiffs is preferred to the appointment of a single Lead Plaintiff. Id. Rather, the Tanne court concluded, that a co-lead plaintiff structure was unnecessary, and might even harm the class by dividing responsibility for the supervision of class counsel. Accordingly, the court, as it should here, denied the institutional investor's request to be appointed co-lead counsel. Id. REPLY ISO GWYN JONES' MOT. TO APPOINT LEAD PL. AND - 7 IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­ NO. C 07-05101 SBA

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V.

THE SPHERA FUND FAILED TO PROVIDED EVIDENCE THAT IT IS AUTHORIZED TO PURSUE THIS CASE ON BEHALF OF ITS CLIENTS

Notwithstanding Mr. Jones' arguments supporting his appointment as Lead Plaintiff, the 3 Sphera Fund failed to provide any evidence that it is authorized to bring this litigation on behalf of 4 the Sphera Fund in its opening motion papers. (Sphera Fund Motion, at 3-5). This lack of 5 authorization is also absent from the Sphera Fund's opposition papers. See In re Peregrine 6 Systems, Inc. Sec. Litig., 2002 WL 3276239, at *14-15 (S.D. Cal. Oct. 11, 2002) (declining to 7 appoint asset management fund as Lead Plaintiff because "it has not submitted any evidence that it 8 received permission to move on its clients' behalf"). Clearly, if such authorization exists, it must 9 be produced in support of Sphera Fund's motion seeking to serve as Lead Plaintiff. Because 10 Sphera Fund failed to submit any evidence that its fund manager is authorized by Sphera Fund's 11 clients to seek appointment as Lead Plaintiff, it cannot be appointed Lead Plaintiff and its selection 12 of Lead Counsel should be rejected. 13 VI. 14 For all of the foregoing reasons, and the reasons set forth in its opening motion, 15 memorandum and all supporting papers, Gwyn Jones respectfully requests that this Court: (1) 16 consolidate all similar actions; (2) appoint Gwyn Jones to serve as Lead Plaintiff in this action; and 17 (3) approve Gwyn Jones' selection of Co-Lead Counsel for the Class. 18 Dated: January 22, 2008 19 20 By: 21 22 23 24 25 26 27 28
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CONCLUSION

HAGENS BERMAN SOBOL SHAPIRO, LLP

/s/ Reed R. Kathrein REED R. KATHREIN

715 Hearst Avenue, Suite 202 Berkeley, CA 94710 Telephone: (510) 725-3000 Facsimile: (510) 725-3001 [email protected] Steve W. Berman HAGENS BERMAN SOBOL SHAPIRO, LLP 1301 Fifth Avenue, Suite 2900 Seattle, WA 98101 Telephone: (206) 623-7292 AND - 8 -

IN RESPONSE TO SPHERA FUND'S OPP'N. TO JONES' MOT. ­

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Facsimile: (206) 623-0594 [email protected] Lewis S. Kahn KAHN GAUTHIER SWICK, LLC 650 Poydras Street, Suite 2150 New Orleans, LA 70130 Telephone: (504) 455-1400 Facsimile: (504) 455-1498 [email protected] Kim E. Miller KAHN GAUTHIER SWICK, LLC 12 East 41st Street, 12th Floor New York, NY 10017 Telephone: (212) 696-3730 Facsimile: (504) 455-1498 [email protected] Attorneys for Plaintiff

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CERTIFICATE OF SERVICE I hereby certify that on January 22, 2008 I electronically filed the foregoing with the Clerk of the Court using the CM/ECF system which will send notification of such filing to the e-mail addresses registered, as denoted on the attached Electronic Mail Notice List, and I hereby certify that I have mailed the foregoing document or paper via the United States Postal Service to the nonCM/ECF participants indicated on the attached Manual Notice List.

/s/ Reed R. Kathrein REED R. KATHREIN

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CAND-ECF

https://ecf.cand.uscourts.gov/cgi-bin/MailList.pl?214810108257461-L_...

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Mailing Information for a Case 4:07-cv-05101-SBA
Electronic Mail Notice List
The following are those who are currently on the list to receive e-mail notices for this case. Michael M. Goldberg [email protected] Lewis Stephen Kahn [email protected] Reed R. Kathrein [email protected],[email protected],[email protected] Joni L. Ostler [email protected],[email protected],[email protected],[email protected],[email protected] Alan Roth Plutzik [email protected] Rodney Grant Strickland , Jr [email protected] Michael Carl Tu [email protected]

Manual Notice List
The following is the list of attorneys who are not on the list to receive e-mail notices for this case (who therefore require manual noticing). You may wish to use your mouse to select and copy this list into your word processing program in order to create notices or labels for these recipients.
James P. Cusick Orrick Herrington & Sutcliffe, LLP 666 Fifth Avenue New York, NY 10103-001

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1/22/2008 2:17 PM