Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_19-cv-06416/USCOURTS-cand-3_19-cv-06416-1/pdf.json

Nature of Suit Code: 850
Nature of Suit: Securities, Commodities, Exchange
Cause of Action: 15:77 Securities Fraud

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United States District Court

Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

AJAY MALHOTRA,

Plaintiff,

v.

SONIM TECHNOLOGIES, INC., et al.,

Defendants.

Case No. 19-cv-06416-MMC 

ORDER GRANTING DAVID 

STERRETT'S MOTION FOR 

APPOINTMENT AS LEAD PLAINTIFF; 

DENYING MOTIONS FILED BY 

LYNDON MAITHER AND BY AJAY 

MALHOTRA/ANDRE LING BIN 

ZULKIFLI

Re: Dkt. Nos. 16, 22, 30

In the instant action, plaintiff alleges, on his behalf and that of a putative class, 

claims under Sections 11 and 15 of the Securities Act of 1933. Now before the Court are 

motions for appointment as lead plaintiff, filed December 6, 2019, by, respectively, David 

Sterrett ("Sterrett") and Lyndon Maither ("Maither").1 Having read and considered the 

respective written submissions filed by Sterrett and Maither, the Court rules as follows.2

Under the Private Securities Litigation Reform Act, a district court "shall appoint as 

lead plaintiff the member or members of the purported plaintiff class that the court 

determines to be most capable of adequately representing the interests of class 

members." See 15 U.S.C. § 77z-1(a)(3)(B)(i). "The 'most capable' plaintiff – and hence 

the lead plaintiff – is the one who has the greatest financial stake in the outcome of the 

 

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In addition, a motion seeking such appointment was filed by Ajay Malhotra and 

Andre Ling Bin Zulkifli (collectively, "Malhotra/Zulkifli"). Those movants, however, 

subsequently filed a statement of non-opposition to the motions filed by the other 

movants.

2On January 15, 2020, the Court took the matters under submission.

Case 3:19-cv-06416-MMC Document 52 Filed 01/22/20 Page 1 of 4
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Northern District of California

case, so long as he meets the requirements of Rule 23 [of the Federal Rules of Civil 

Procedure]," see In re Cavanaugh, 306 F.3d 726, 729 (9th Cir. 2002), "in particular, those 

of 'typicality' and 'adequacy,'" see id. at 730 (quoting Rule 23).

Here, by order filed January 7, 2020, as amended January 22, 2020, the Court 

found Sterrett has incurred the greatest loss and that his claim is typical of those of the 

putative class members. With respect to the question of adequacy, the Court found the 

evidence offered in support of Sterrett's reply, specifically, a declaration by Sterrett 

setting forth his work experience and other background information, read in connection 

with the showing made in his moving papers, appeared sufficient to show he is an 

adequate representative. As the Court's finding as to adequacy was based in part on 

evidence offered with Sterrett's reply, the Court afforded Maither leave to file a surreply to 

respond. See id. (holding courts must "give other plaintiffs an opportunity to rebut the 

presumptive lead plaintiff's showing").

In his surreply, Maither raises three arguments in opposition to Sterrett's 

appointment. As set forth below, the Court finds none of those arguments persuasive.

First, Maither argues, the evidence offered in support of Sterrett's reply was not 

submitted in timely fashion and, consequently, should not be considered. As noted, 

however, the Court afforded Maither an opportunity to respond to that evidence and he 

has done so. Under the circumstances, the Court finds it appropriate to consider the 

evidence offered with Sterrett's reply.

Second, Maither argues, Sterrett's failure to submit such evidence at the time he 

filed his initial motion renders that motion "defective" (see Maither's Surreply at 2:8-10), 

and thus indicates Sterrett may be unable to fairly represent the class. The Court, 

however, finds any such omission does not indicate a lack of adequacy, as no movant, 

including Maither, submitted with his moving papers a declaration or other evidence 

setting forth his work history or other biographical background information, thus 

suggesting it is not the general practice to do so.

//

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Lastly, Maither asserts that, for various reasons, he would be a more adequate 

lead plaintiff. Once the plaintiff with the largest financial stake has been identified, 

however, the Court's task is not to compare that plaintiff's various attributes with those of 

other plaintiffs, but, rather, to determine whether that plaintiff is an adequate 

representative. See Cavanaugh, 306 F.3d at 731-32 (finding "error" where district court 

engaged in "freewheeling comparison" of parties competing for lead plaintiff; noting 

whether "the court believes another plaintiff may be . . . 'more adequate' is of no 

consequence").

Accordingly, the above-captioned putative class action having been filed in the 

Northern District of California, Sterrett's having filed a timely motion to be appointed lead 

plaintiff, Sterrett's having the largest financial interest in the relief sought by the putative 

class and having otherwise satisfied the requirements of Section 27 of the Securities Act 

and Rule 23, and Sterrett's seeking, in accordance with Section 27(a)(3)(B)(v) of the 

Securities Act, 15 U.S.C. § 77z-1(a)(3)(B)(v), approval of his selection of Faruqi & Faruqi, 

LLP to serve as lead counsel for the putative class, Maither's motion and 

Malhotra/Zulkifli's motion are hereby DENIED, and Sterrett's motion is hereby 

GRANTED, as follows:

1. Pursuant to Section 27 of the Securities Act, 15 U.S.C. § 77z-1(a)(3)(B), 

Sterrett is hereby appointed as lead plaintiff for the putative class.

2. Pursuant to Section 27 of the Securities Act, 15 U.S.C. § 77z-1(a)(3)(B)(v), 

Faruqi & Faruqi, LLP is hereby approved to serve the lead plaintiff and the putative class 

as lead counsel.

3. As lead counsel, Faruqi & Faruqi, LLP shall be generally responsible for the 

overall conduct of the litigation on behalf of the putative class and shall have sole 

authority to do the following:

a. Determine and present to the Court and opposing parties the position of

the lead plaintiff and putative class members on all matters arising during pretrial 

proceedings;

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 b. Enter into stipulations with opposing counsel as necessary for the 

conduct of the litigation;

c. Coordinate the initiation and conduct of discovery on behalf of the lead 

plaintiff and putative class members consistent with the requirements of the Federal 

Rules of Civil Procedure;

d. Hire expert witnesses and consultants on behalf of the lead plaintiff and 

putative class members, as needed to prepare for class certification or trial, and advance 

other costs that may be reasonable and necessary to the conduct of the litigation;

e. Conduct settlement negotiations on behalf of the lead plaintiff and 

putative class members, and, if appropriate, to enter into a settlement that is fair, 

reasonable, and adequate on behalf of the putative class members;

f. Monitor its activities to ensure that schedules are met and unnecessary 

expenditures of time and funds are avoided; and

g. Perform such other duties as may be incidental to the proper 

prosecution and coordination of pretrial and trial-related activities on behalf of the lead 

plaintiff and putative class members or authorized by further order of this Court.

IT IS SO ORDERED.

Dated: January 22, 2020

MAXINE M. CHESNEY

United States District Judge

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