Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_02-cv-01486/USCOURTS-cand-4_02-cv-01486-71/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

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

In re: JDS UNIPHASE CORPORATION

SECURITIES LITIGATION

 

This document relates to ALL ACTIONS

 /

No. C-02-1486 CW (EDL)

ORDER DENYING DEFENDANT

KALKHOVEN’S MOTION TO STRIKE

REBUTTAL REPORT OF SEYHUN AS

TO TRADING BY KALKHOVEN AND

GRANTING THE JDSU DEFENDANTS’

MOTION TO STRIKE AS TO TRADING

BY STRAUS, MULLER AND ABBE

Defendant Kalkhoven moved to strike the Rebuttal Report of Plaintiffs’ expert, Professor

Seyhun, in its entirety and the JDSU defendants moved to strike those portions of the same report

referring to trading in JDSU stock by his JDSU co-defendants. Kalkhoven’s opening expert report

by Professor Guay opined that Kalkhoven’s trading patterns were consistent with the objective of

diversification and liquidity, as evidence that Kalkhoven did not improperly trade on insider

information. The report did not address trading by any of the JDSU co-defendants. The report by

Professor Seyhun opines that no evidence shows that Kalkhoven actually did achieve diversification

or liquidity and that his sales of JDSU stock are consistent with profiting from inside information. 

Plaintiff’s report attempts to bolster the latter conclusion with correlations between Kalkhoven’s

trading patterns and those of his JDSU co-defendants. 

The question whether the Seyhun report is proper rebuttal insofar as it addresses Kalkhoven

is a close one; the better practice would have been to disclose the report initially. Nonetheless, the

Seyhun report does respond to and attempt to refute the opinions in the Guay report about the

rationale for Kalkhoven’s trading in JDSU stock. The Seyhun report crosses the line, however, in

attempting to tie the subject of the co-defendants’ trading in JDSU stock to the coattails of Guay’s

Case 4:02-cv-01486-CW Document 1029 Filed 03/28/07 Page 1 of 2
United States District Court

For the Northern District of California

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analysis of Kalkhoven’s trading, when that analysis makes no mention of the co-defendants. 

Accordingly, Kalkhoven’s motion to strike is denied as to the portions of the Seyhun report

addressing his trading, but the motions of Kalkhoven and JDSU are granted as to the portions of the

report addressing trading by Straus, Miller and Abbe. 

Further, Kalkhoven’s request in the alternative that he be allowed to submit a rebuttal to the

portions of the Seyhun report that remain is granted, given the closeness of the issue, provided that it

is produced promptly. In particular, since Kalkhoven has already had the Seyhun report for some

time and it is relatively straightforward, the rebuttal report must be provided by April 5, and the

rebuttal expert must be made available for deposition on or before April 12.

IT IS SO ORDERED.

Dated: March 28, 2007 

ELIZABETH D. LAPORTE

United States Magistrate Judge

Case 4:02-cv-01486-CW Document 1029 Filed 03/28/07 Page 2 of 2