United States District Court, D. South Carolina, Rock Hill Division
JAMES NALLY, derivatively on behalf of 3D SYSTEMS CORPORATION, Plaintiff,
ABRAHAM N. REICHENTAL, DAMON J. GREGOIRE, CHARLES W. HULL, DANIEL S. VAN RIPER, G. WALTER LOEWENBAUM, II, JIM D. KEVER, KAREN E. WELKE, KEVIN S. MOORE, PETER H. DIAMANDIS, WILLIAM D. HUMES, and WILLIAM E. CURRAN, Defendants. and 3D SYSTEMS CORPORATION, Nominal Defendant. MARK FOSTER, Plaintiff,
ABRAHAM REICHENTAL; DAMON GREGOIRE; CHARLES HULL; WILLIAM E. CURRAN; KEVIN S. MOORE; DANIEL VAN RIPER; WALTER G. LOEWENBAUM II; JIM D. KEVER; KAREN WELKE; PETER DIAMANDIS; AND WILLIAM HUMES Defendants. and 3D SYSTEMS CORPORATION, Nominal Defendant. DAVE HOWES, Derivatively on Behalf of 3D SYSTEMS CORPORATION, Plaintiff,
ABRAHAM N. REICHENTAL, DAMON J. GREGOIRE, CHARLES W. HULL, THEODORE A. HULL, WILLIAM E. CURRAN, PETER H. DIAMANDIS, WILLIAM D. HUMES, JIM D. KEVER, G. WALTER LOEWENBAUM, KEVIN S. MOORE, DANIEL S. VAN RIPER, and KAREN E. WELKE, Defendants. and 3D SYSTEMS CORPORATION, a Delaware corporation, Nominal Defendant. PHILLIP AMEDURI, Derivatively on Behalf of 3D SYSTEMS CORPORATION, Plaintiff,
ABRAHAM N. REICHENTAL, DAMON J. GREGOIRE, CHARLES W. HULL, THEODORE A. HULL, WILLIAM E. CURRAN, PETER H. DIAMANDIS, WILLIAM D. HUMES, JIM D. KEVER, G. WALTER LOEWENBAUM, KEVIN S. MOORE, DANIEL S. VAN RIPER, and KAREN E. WELKE, Defendants. and 3D SYSTEMS CORPORATION, a Delaware corporation, Nominal Defendant.
MEMORANDUM OPINION AND ORDER CONSOLIDATING CASES AND
APPOINTING CO-LEAD PLAINTIFFS AND CO-LEAD COUNSEL
GEIGER LEWIS UNITED STATES DISTRICT JUDGE
filed these related cases as shareholder derivative actions
(collectively, Related Actions) on behalf of Nominal
Defendant 3D Systems Corporation (3D Systems) against certain
of its current and former officers and directors. Pending
before the Court is Plaintiff James Nally's (Nally)
motion to consolidate the Related Actions, appoint Nally as
Lead Plaintiff, and approve Nally's selection of Lead
Counsel. Also pending before the Court is Plaintiff Dave
Howes (Howes), Plaintiff Mark Foster (Foster), and Plaintiff
Philip Ameduri's (Ameduri) joint motion (Howes's
motion) to consolidate the Related Actions, appoint Howes as
Lead Plaintiff, and approve Howes's selection of Lead
Counsel. Having carefully considered the motions, the
responses, the replies, Nally's sur-reply, the record,
and the applicable law, the Court will grant the motions in
part and deny them in part.
FACTUAL AND PROCEDURAL HISTORY
Related Actions all stem from the facts underlying a
securities class action pending in this Court, captioned
KBC Asset Management NV v. 3D Systems Corp., et al.,
No. 0:15-cv-02393-MGL (the Securities Class Action). In the
Securities Class Action, investors allege 3D Systems and its
insiders made false and misleading statements to the market
regarding 3D Systems' prospects, causing the stock to
trade at inflated prices during the period October 29, 2013,
through May 5, 2015.
filed the first of the Related Actions on September 18, 2015,
Nally v. Reichental et al., No. 0:15-cv-03756-MGL.
Foster filed his lawsuit on April 1, 2016, Foster v.
Reichental et al., No. 0:16-cv-01016-MGL, Howes filed
his case on August 11, 2016, Howes v. Reichental et
al., No. 0:16-cv-02810-MGL, and Ameduri filed his claims
on September 1, 2016, Ameduri v. Reichental et al.,
No. 0:16-cv-02995-MGL. This Court stayed each of the Related
Actions until the earlier of the close of discovery in the
Securities Class Action or the deadline for filing an appeal
of the dismissal of the Securities Class Action.
filed an Amended Complaint on January 5, 2017. Then, on
February 1, 2017, Nally filed his motion to consolidate the
Related Actions, appoint Nally as Lead Plaintiff, and approve
Nally's selection of Lifshitz & Miller as Lead
Counsel and Duffy & Young, LLC as Liaison Counsel.
Defendants responded in support of the motion to consolidate
the Related Actions but took no position regarding the
appointment of Lead Plaintiff and Lead Counsel. Meanwhile,
Howes, Foster, and Ameduri filed a response in opposition to
the portion of Nally's motion seeking appointment as Lead
Plaintiff and approval of Lead Counsel, to which Nally filed
February 15, 2017, Howes, Foster, and Ameduri filed their
joint motion to consolidate the Related Actions, appoint
Howes as Lead Plaintiff, and approve Howes's Counsel
Structure. Howes supports a proposed Executive Committee of
Plaintiffs' counsel, with Schubert Jonckheer & Kolbe
LLP designated as Chair of the Executive Committee, Johnson
& Weaver, LLP and Bottini & Bottini, Inc. both
serving as members thereof, and Strom Law Firm, LLC serving
as Liaison Counsel. Nally filed a response in opposition to
the portion of Howes's motion seeking appointment as Lead
Plaintiff and approval of Counsel Structure, to which Howes
filed a reply and Nally filed a sur-reply.
Court, having been fully briefed on the relevant issues, is
now prepared to discuss the merits of Nally's and
DISCUSSION AND ANALYSIS
Motions to Consolidate
42(a) of the Federal Rules of Civil Procedure governs
consolidation, providing “[i]f actions before the court
involve a common question of law or fact, the court may: (1)
join for hearing or trial any or all matters at issue in the
actions; (2) consolidate the actions; or (3) issue any other
orders to avoid unnecessary cost or delay.”
Fed.R.Civ.P. 42(a). The power to consolidate related actions
falls within the broad inherent authority of every court
“to control the disposition of the causes on its docket
with economy of time and effort for itself, for counsel, and
for litigants.” Landis v. N. Am. Co., 299 U.S.
248, 254 (1936); see also Arnold v. E. Air Lines,
Inc., 681 F.2d 186, 193 (4th Cir. 1982) (upholding
the district court's broad discretion under Rule 42(a)).
of similar shareholder derivative actions can be particularly
beneficial to courts and parties by expediting pretrial
proceedings, avoiding needless duplication, and minimizing
expenditure of time, effort, and money. See MacAlister v.
Guterma, 263 F.2d 65, 68 (2d Cir. 1958) (“The
purpose of consolidation is to permit trial convenience and
economy in administration.”). Moreover, “when
consolidation is appropriate, the Court has the discretion to
order the consolidation of subsequently-filed or transferred
cases that allege similar facts as those alleged in the
current shareholder derivative suits.” See,
e.g., Horn v. Raines, 227 F.R.D. 1, 2 (D.D.C.
observed above, all parties in the Related Actions request
the Court consolidate the Related Actions under Rule 42(a),
as the Related Actions involve common questions of law or
fact. Each of the Related Actions alleges claims for breach
of fiduciary duty arising out of the same or similar conduct.
Consequently, each case will involve essentially the same
motion practice, discovery, and trial considerations. The
Court, in its discretion, holds consolidation of the Related
Actions will be the most efficient use of the Court's and
the parties' resources, and, in light of ...