Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_18-cv-06922/USCOURTS-cand-3_18-cv-06922-1/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:78m(a) Securities Exchange Act

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

STEPHEN LOPES,

Plaintiff,

v.

FITBIT, INC., et al.,

Defendants.

Case No. 18-cv-06665-JST 

ORDER CONSOLIDATING CASES 

AND APPOINTING LEAD PLAINTIFF 

AND LEAD COUNSEL

Re: ECF No. 26

Before the Court is Plaintiff Irving Lubman’s motion to consolidate Lopes v. Fitbit Inc., 

Case No. 18-cv-6665, with Patti v. Fitbit, Inc., Case No. 18-cv-6922 (“Related Securities Class 

Actions”), to appoint Lubman as Lead Plaintiff, and to approve Lubman’s selection of counsel for 

the class. ECF No. 26. The Court will grant the motion. 

I. CONSOLIDATION

A. Legal Standard

“If actions before the court involve a common question of law or fact, the court may . . . 

consolidate the actions.” Fed. R. Civ. P. 42(a)(2). “The district court has broad discretion under 

this rule to consolidate cases pending in the same district.” Inv’rs Research Co. v. U.S. Dist. 

Court, 877 F.2d 777, 777 (9th Cir. 1989). “In determining whether or not to consolidate cases, the 

Court should ‘weigh the interest of judicial convenience against the potential for delay, confusion 

and prejudice.’” Zhu v. UCBH Holdings, Inc., 682 F. Supp. 2d 1049, 1052 (N.D. Cal. 2010) 

(quoting Sw. Marine, Inc. v. Triple A Mach. Shop, Inc., 720 F. Supp. 805, 806-07 (N.D. Cal. 

1989)).

B. Analysis

The Related Securities Class Actions are both putative class actions brought on behalf of 

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“persons and entities that acquired Fitbit securities between August 2, 2016 and January 30, 2017, 

inclusive (the ‘Class Period’), seeking to pursue remedies under the Securities Exchange Act of 

1934 (the ‘Exchange Act’).” Lopes Compl., ECF No. 1; see Patti Compl., ECF No. 1. Both 

complaints allege that Defendants made materially false and misleading statements, primarily by 

overstating Fitbit’s financial guidance and failing to disclose that the company was struggling to 

differentiate itself from its competitors. Id. The complaints rely on largely the same statements 

and omissions. Id. Defendants agree that the cases involve common questions of law and fact and 

should be consolidated. ECF No. 40 at 2. Thus, the Court concludes that judicial convenience 

and a just, efficient resolution of the parties’ claims would be best served by consolidating the 

Related Securities Class Actions.

II. APPOINTMENT OF LEAD PLAINTIFF AND LEAD COUNSEL

A. Legal Standard

The Private Securities Litigation Reform Act of 1995 (“PSLRA”) provides that “[n]ot later 

than 20 days after the date on which the complaint is filed,” the plaintiff shall publish a notice 

alerting members of the purported class of “the pendency of the action, the claims asserted therein, 

and the purported class period.” 15 U.S.C. § 78u-4(3)(a)(i). The notice should also inform 

potential class members that “not later than 60 days after the date on which the notice is published, 

any member of the purported class may move the court to serve as lead plaintiff of the purported 

class.” 15 U.S.C. § 78u-4(3)(a)(i)(II). 

Under the PSLRA, “[t]he ‘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 [the proposed lead 

plaintiff] meets the requirements of Rule 23” of the Federal Rules of Civil Procedure. In re 

Cavanaugh, 306 F.3d 726, 729 (9th Cir. 2002). After the Court makes its determination of the 

presumptive lead plaintiff, other plaintiffs in the class will be provided with “an opportunity to 

rebut the presumptive lead plaintiff’s showing that it satisfies Rule 23’s typicality and adequacy 

requirements.” Id. at 730. “If, as a result of this process, the district court determines that the 

presumptive lead plaintiff does not meet the typicality or adequacy requirement, it then must 

proceed to determine whether the plaintiff with the next lower stake in the litigation has made a 

prima facie showing of typicality and adequacy.” Id. at 731. 

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“The most adequate plaintiff shall, subject to the approval of the court, select and retain 

counsel to represent the class.” 15 U.S.C. § 78u-4(a)(3)(B)(v). “[I]f the lead plaintiff has made a 

reasonable choice of counsel, the district court should generally defer to that choice,” and “should 

not reject a lead plaintiff’s proposed counsel merely because it would have chosen differently.” 

Cohen v. U.S. Dist. Court, 586 F.3d 703, 711-12 (9th Cir. 2009).

B. Analysis

The Court finds that Lubman is the plaintiff with the largest financial stake in the lawsuit, 

having suffered a loss of over $300,000. ECF No. 26 at 7. The other plaintiffs who moved to be 

appointed Lead Plaintiff have since withdrawn their motions, acknowledging that they do not have 

the largest financial interest. See ECF No. 45 (Lubman’s notice of non-opposition); ECF Nos. 15, 

39 (Wesley Archer, asserting he lost $200,661, then withdrawing his motion in recognition that 

Lubman has the largest financial interest); ECF Nos. 20, 42 (Teamsters Local 710 Pension Fund, 

claiming losses of over $300,000 but acknowledging that its loss is not the largest); ECF Nos. 28, 

44 (Jason Rylander, alleging losses of over $99,000 but recognizing that it appears he does not 

possess the largest financial interest); ECF Nos. 31, 43 (Fitbit Investor Group, comprised of 

Robert Sherman, Jeff Sharp, and Ananda Patti, claiming losses between $226,302 and $247,669 

but then admitting that it appears not to have the largest financial interest). Because Lubman has 

the largest financial stake, he is the presumptive Lead Plaintiff. 

In addition to having the largest financial interest in this litigation, Lubman has made a 

prima facie showing that he satisfies the requirements of Rule 23. First, he meets the typicality 

requirement. The legal and factual bases of Lubman’s claim revolve around whether Defendants 

publically disseminated false and misleading statements and the effect of those alleged statements. 

The same is true for the rest of the putative class. Lubman also meets Rule 23’s adequacy 

requirement. His interests are closely aligned with those of the other class members, with no 

apparent antagonism between them. Therefore, the Court appoints Lubman as Lead Plaintiff.

Lubman is represented by Glancy Prongay & Murray LLP and asks the Court to approve 

that firm as Lead Counsel. ECF No. 26 at 9-10. The firm has experience with securities class 

actions and has served as lead counsel in similar cases in this district. ECF No. 27-4 at 2-4. The 

Court concludes Glancy Prongay & Murray LLP will provide effective representation to the class. 

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CONCLUSION

The Court grants the motion to consolidate Lopes v. Fitbit Inc., Case No. 18-cv-6665, with 

Patti v. Fitbit, Inc., Case No. 18-cv-6922. The Court appoints Irving Lubman as Lead Plaintiff 

and approves Glancy Prongay & Murray LLP as Lead Counsel for the class.

IT IS SO ORDERED.

Dated: April 25, 2019

______________________________________

JON S. TIGAR

United States District Judge

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