UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA Harvey L. Poppel, individually and on behalf of all other persons similarly situated, Plaintiff, vs. eFunds Corporation; John A. Blanchard III; Paul H. Bristow; and Thomas S. Liston, Defendants. : : : : : : : : : : : : : : : : Case No. CV-03-1915-PHX-JWS Class Action
PRELIMINARY ORDER FOR NOTICE AND HEARING IN CONNECTION WITH SETTLEMENT PROCEEDINGS
WHEREAS, on December 29, 2005, the parties to the above-entitled action (the "Action") entered into a Stipulation and Settlement Agreement (the "Stipulation") which is subject to review under Rule 23 of the Federal Rules of Civil Procedure and which, together with the exhibits thereto, sets forth the terms and conditions for the proposed settlement of the claims alleged in the Consolidated Amended Complaint on the merits and with prejudice; and the Court having read and considered the Stipulation and the accompanying documents; and the parties to the Stipulation having consented to the entry of this Order; and all capitalized terms used herein having the meanings defined in the Stipulation;
Case 2:03-cv-01915-JWS
Document 88
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NOW, THEREFORE, IT IS HEREBY ORDERED, this 13th day of January 2006 that: 1. Pursuant to Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure, and
for the purposes of the Settlement only, this Action is hereby certified as a class action on behalf of all persons who purchased the stock of eFunds Corporation ("eFunds") during the period between July 21, 2000 and October 24, 2002, inclusive. Excluded from the Class are the Defendants, the officers and directors of eFunds, members of their immediate families (parents, spouses, siblings, and children) and their legal representatives, heirs, successors or assigns, and any entity in which any Defendant has or had a controlling interest. Also excluded from the Class are any putative Class Members who exclude themselves by filing a request for exclusion in accordance with the requirements set forth in the Notice. 2. The Court finds, for the purposes of the Settlement only, that the prerequisites for
a class action under Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure have been satisfied in that: (a) the number of Class Members is so numerous that joinder of all members thereof is impracticable; (b) there are questions of law and fact common to the Class; (c) the claims of the named representatives are typical of the claims of the Class they seek to represent; (d) the Lead Plaintiff will fairly and adequately represent the interests of the Class; (e) the questions of law and fact common to the members of the Class predominate over any questions affecting only individual members of the Class; and (f) a class action is superior to other available methods for the fair and efficient adjudication of the controversy. 3. Pursuant to Rule 23 of the Federal Rules of Civil Procedure, and for the purposes
of the Settlement only, Lead Plaintiff Harvey L. Poppel is certified as the Class Representative. 4. The Court has reviewed the proposed Stipulation and preliminarily finds the
Stipulation and Settlement to be fair, reasonable, and adequate;
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5.
A hearing (the "Settlement Fairness Hearing") pursuant to Rule 23(e) of the
Federal Rules of Civil Procedure is hereby scheduled to be held before the Court on April 7, 2006, at 10:30 a.m. for the following purposes: (a) to finally determine whether this Action satisfies the applicable
prerequisites for class action treatment under Rules 23(a) and (b)(3) of the Federal Rules of Civil Procedure; (b) to finally determine whether the proposed Stipulation and Settlement are
fair, reasonable, and adequate, and should be approved by the Court; (c) to determine whether the Order and Final Judgment as provided under the
Stipulation should be entered, dismissing the Consolidated Amended Complaint filed herein, on the merits and with prejudice, and to determine whether the release by the Class of the Settled Claims, as set forth in the Stipulation, should be provided to the Released Parties; (d) to determine whether the proposed Plan of Allocation for the proceeds of
the Settlement is fair and reasonable, and should be approved by the Court; (e) to consider Plaintiffs' Counsel's application for an award of attorneys'
fees and expenses; and (f) 6. to rule upon such other matters as the Court may deem appropriate.
The Court reserves the right to approve the Stipulation and Settlement with or
without modification and with or without further notice of any kind. The Court further reserves the right to enter its Order and Final Judgment approving the Stipulation and dismissing the Consolidated Amended Complaint on the merits and with prejudice regardless of whether it has approved the Plan of Allocation or awarded attorneys' fees and expenses.
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7.
The Court approves the form, substance and requirements of the Notice of
Pendency of Class Action and Proposed Settlement, Motion for Attorneys' Fees and Settlement Fairness Hearing (the "Notice") and the Proof of Claim and Release form, annexed hereto as Exhibits 1 and 2 respectively. 8. Administrator. 9. As provided in the Stipulation, eFunds shall cause the Notice and the Proof of The Court approves the appointment of Gilardi & Co. LLC as the Claims
Claim and Release, substantially in the forms annexed hereto, to be mailed, by first class mail, postage prepaid, on or before January 20, 2006, to all Class Members who can be identified with reasonable effort based upon its transfer records and shareholder information. Defendant eFunds may, at its option, utilize the Claims Administrator to accomplish such notice. eFunds, or the Claims Administrator if eFunds chooses to utilize the Claims Administrator, shall use reasonable efforts to give notice to nominee owners such as brokerage firms and other persons or entities who purchased eFunds stock during the Class Period as record owners but not as beneficial owners. Such nominee purchasers are directed, within seven (7) days of their receipt of the Notice, to either forward copies of the Notice and Proof of Claim and Release to their beneficial owners, or to provide eFunds (or the Claims Administrator) with lists of the names and addresses of the beneficial owners, and eFunds (or the Claims Administrator) is ordered to send the Notice and Proof of Claim and Release promptly to such identified beneficial owners. Nominee
purchasers who elect to send the Notice and Proof of Claim and Release to their beneficial owners shall send a statement to eFunds (or the Claims Administrator) confirming that the mailing was made as directed. Additional copies of the Notice and Proof of Claim and Release shall be made available to any record holder requesting such for the purpose of distribution to
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beneficial owners, and such record holders shall be reimbursed by eFunds, upon receipt by eFunds (or the Claims Administrator) of proper documentation, for the reasonable costs incurred in mailing the Notices and Proofs of Claim and Release to beneficial owners. eFunds (or the Claims Administrator) shall, at or before the Settlement Fairness Hearing, file with the Court proof of mailing of the Notice and Proof of Claim and Release. 10. The Court approves the form of Publication Notice of the pendency of this class
action and the proposed settlement in substantially the form and content annexed hereto as Exhibit 3 and directs that eFunds shall cause the Publication Notice to be published in the national edition of Investor's Business Daily within ten days of the mailing of the Notice. Defendant eFunds Counsel shall, at or before the Settlement Fairness Hearing, file with the Court proof of publication of the Published Notice. 11. The form and content of the Notice and Publication Notice, and the method set
forth herein of notifying the Class of the Settlement and its terms and conditions, meet the requirements of Rule 23 of the Federal Rules of Civil Procedure, Section 21D(a)(7) of the Securities Exchange Act of 1934, 15 U.S.C. 78u-4(a)(7) as amended by the Private Securities Litigation Reform Act of 1995, and due process, constitute the best notice practicable under the circumstances, and shall constitute due and sufficient notice to all persons and entities entitled thereto. 12. In order to be entitled to participate in the Net Settlement Fund, in the event the
Settlement is effected in accordance with the terms and conditions set forth in the Stipulation, each Class Member shall take the following actions and be subject to the following conditions: (a) A properly executed Proof of Claim and Release, substantially in the form
attached hereto as Exhibit 2, must be submitted to the Claims Administrator, at the Post Office
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Box indicated in the Notice, postmarked not later than May 5, 2006. Such deadline may be further extended by Court Order. Each Proof of Claim and Release shall be deemed to have been submitted when postmarked (if properly addressed and mailed by first class mail, postage prepaid) provided such Proof of Claim and Release is actually received prior to the motion for an order of the Court approving distribution of the Net Settlement Fund. Any Proof of Claim and Release submitted in any other manner shall be deemed to have been submitted when it was actually received at the address designated in the Notice. (b) The Proof of Claim and Release submitted by each Class Member must
satisfy the following conditions: (i) it must be properly completed, signed and submitted in a timely manner in accordance with the provisions of the preceding subparagraph; (ii) it must be accompanied by adequate supporting documentation for the transactions reported therein, in the form of broker confirmation slips, broker account statements, an authorized statement from the broker containing the transactional information found in a broker confirmation slip, or such other documentation as is deemed adequate by Lead Counsel; (iii) if the person executing the Proof of Claim and Release is acting in a representative capacity, a certification of his current authority to act on behalf of the Class Member must be included in the Proof of Claim and Release; and (iv) the Proof of Claim and Release must be complete and contain no material deletions or modifications of any of the printed matter contained therein and must be signed under penalty of perjury. (c) As part of the Proof of Claim and Release, each Class Member shall
submit to the jurisdiction of the Court with respect to the claim submitted, and shall (subject to effectuation of the Settlement) release all Settled Claims as provided in the Stipulation.
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13.
Class Members shall be bound by all determinations and judgments in this
Action, whether favorable or unfavorable, and whether or not they execute or deliver a valid and timely Proof of Claim and Release, unless such persons request exclusion from the Class in a timely and proper manner, as hereinafter provided. A Class Member wishing to make such request shall mail the request in written form by first class mail postmarked no later than March 20, 2006 to the address designated in the Notice. Such request for exclusion shall clearly indicate the name, address and telephone number of the person seeking exclusion, that the sender requests to be excluded from the Class in the eFunds Securities Litigation, and must be signed by such person. Such persons requesting exclusion are also directed to state: the date(s), price(s), and number(s) of shares of all purchases and sales of eFunds stock during the Class Period. The request for exclusion shall not be effective unless it provides the required information and is made within the time stated above, or the exclusion is otherwise accepted by the Court. 14. Class Members requesting exclusion from the Class shall not be entitled to
receive any payment out of the Net Settlement Fund as described in the Stipulation and Notice. 15. The Court will consider comments and/or objections to the Settlement, the Plan of
Allocation, or the award of attorneys' fees and reimbursement of expenses only if such comments or objections and any supporting papers are filed in writing with the Clerk of the Court, United States District Court of Arizona, Phoenix, Sandra Day O'Connor U.S. Courthouse, 401 W. Washington Street, Suite 130, SPC 1, Phoenix, Arizona 85003-2118, and copies of all such papers are served, on or before March 20, 2006, upon each of the following: Michael C. Spencer, Esq., Milberg Weiss Bershad & Schulman LLP, One Pennsylvania Plaza, New York, New York 10119-0165 and Guri Ademi, Esq., Ademi & O'Reilly, LLP, 3620 East Layton Avenue, Cudahy, Wisconsin 53110, on behalf of Lead Plaintiff and the Class; and Daniel E.
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Loeb, Esq., Fried, Frank, Harris, Shriver & Jacobson LLP, 1001 Pennsylvania Avenue, N.W., Washington, D.C. 20004, Lawrence Iason, Esq., Morvillo, Abramowitz, Grand, Iason &
Silberberg, P.C., 565 Fifth Avenue, New York, New York 10017, and Mark D. Cahn, Esq., Wilmer Cutler Pickering Hale and Dorr LLP, 2445 M Street, N.W., Washington, D.C. 200371420, on behalf of the Defendants. Attendance at the hearing is not necessary; however, persons wishing to be heard orally in opposition to the approval of the Settlement, the Plan of Allocation, and/or the request for attorneys' fees are required to indicate in their written objection their intention to appear at the hearing. Persons who intend to object to the Settlement, the Plan of Allocation, and/or counsel's application for an award of attorneys' fees and expenses and desire to present evidence at the Settlement Fairness Hearing must include in their written objections the identity of any witnesses they may call to testify and exhibits they intend to introduce into evidence at the Settlement Fairness Hearing. Class Members do not need to appear at the hearing or take any other action to indicate their approval. 16. Pending final determination of whether the Settlement should be approved, Lead
Plaintiff, all Class Members, and each of them, and anyone who acts or purports to act on their behalf, shall not institute, commence or prosecute any action which asserts Settled Claims against any Released Party. 17. As provided in the Stipulation, Lead Counsel may pay the Claims Administrator
the reasonable fees and costs associated with giving notice to the Class and the review of claims and administration of the Settlement out of the Gross Settlement Fund without further order of the Court. 18. If: (a) the Settlement is terminated by Defendants pursuant to paragraph 24 of the
Stipulation; or (b) any specified condition to the Settlement set forth in the Stipulation is not
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satisfied and Lead Counsel or Defendants' Counsel elects to terminate the Settlement as provided in paragraph 25 of the Stipulation, then, in any such event, the Stipulation, including any amendment(s) thereof, and this Preliminary Order certifying the Class and the Class Representatives for purposes of the Settlement shall be null and void, of no further force or effect, and without prejudice to any party, and may not be introduced as evidence or referred to in any actions or proceedings by any person or entity, and each party shall be restored to his, her or its respective position as it existed immediately prior to March 21, 2005. 19. The Court retains exclusive jurisdiction over the Action to consider all further
matters arising out of or connected with the Settlement. Dated: January 13, 2006 /s/ Honorable John W. Sedwick UNITED STATES DISTRICT JUDGE
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