Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_12-cv-04007/USCOURTS-cand-3_12-cv-04007-17/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

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IN RE ZYNGA INC. SECURITIES 

LITIGATION

Case No. 12-cv-04007-JSC 

Consolidated with Case Nos.

12-CV-4048-JSC; 12-CV-4059-JSC;

12-CV-4064-JSC; 12-CV-4066-JSC;

12-CV-4133-JSC; 12-CV-4250-JSC

ORDER FOR SUPPLEMENTAL 

BRIEFING ON MOTION FOR 

PRELIMINARY APPROVAL OF CLASS 

ACTION SETTLEMENT

Re: Dkt. No. 205

Lead Plaintiff David Fee (“Lead Plaintiff”) seeks preliminary approval of a class action 

settlement in this pre-certification securities litigation action. The Court heard oral argument 

regarding the motion for preliminary approval on October 8, 2015 and raised several questions 

with Lead Plaintiff. 

First, Lead Plaintiff’s proposed Plan of Allocation provides for a lower rate of recovery for 

shares of Zynga common stock purchased between December 15, 2011 and the close of trading on 

February 14, 2012 (the Earlier Period) than for shares purchased after the close of trading on 

February 14, 2012 through the close of trading on July 25, 2012 (the Class Period). In his motion, 

Lead Plaintiff contends that the Settlement Class Members in the Earlier Period receive a smaller 

per-share recovery because their claims are weaker, evidenced by the fact that their claims were 

dismissed from the initial consolidated complaint and are not part of the operative pleading. But 

the district court’s order dismissed the entire initial consolidated complaint, not just those from the 

Earlier Period. (Dkt. No. 152.) Lead Plaintiff chose not to replead the Earlier Period claims. 

(Dkt. No. 155.) Lead Plaintiff must file a supplemental submission that provides a more forthright

and robust explanation reflecting the procedural history and Lead Plaintiff’s position on why the 

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United States District Court

Northern District of California

Earlier Period claims are weaker. In addition, in the supplemental submission Lead Plaintiff shall 

make clear when he bought and sold his shares of Zynga common stock—i.e., to the extent his 

claims fall in the Earlier Period or the Class Period. The Notice shall be amended to accurately 

reflect the procedural history.

Second, the initial Stipulation and Notice required that all Settlement Class Members 

submit their claim forms by mail. In response to questioning from the Court, Lead Plaintiff agreed 

that Settlement Class Members may submit their claim forms electronically. The Stipulation and 

Notice should be amended to reflect this change.

Third, the Notice is not entirely accurate regarding Settlement Class Members’ opportunity 

to object. The objection provision reads in relevant part:

You can ask the Court to deny approval by filing an objection. You 

cannot ask the Court to order a larger settlement or otherwise 

modify the Settlement; the Court can only approve or deny the 

Settlement. If the Court denies approval, no Settlement payments 

will be sent out and the Action will continue. If this is what you 

want to happen, you must object.

(Dkt. No. 206-1 at 58.) While technically true, the parties’ language as currently written fails in 

this paragraph to notify Settlement Class Members that they can object to the amount of attorneys’

fees and costs sought. The Notice should also include the deadline for Lead Counsel’s attorneys’ 

fees motion and note that the motion and supporting materials will be available for viewing on the 

Claims Administrator’s website. See In re Mercury Interactive Corp. Sec. Litig., 618 F.3d 988, 

993-94 (9th Cir. 2010) (holding that under Rule 23(h), class members must be given a full and fair 

opportunity to examine and object to attorneys’ fees motions); see, e.g., Hendricks v. StarKist Co., 

No. 13-cv-00729-HSG, 2015 WL 4498083, at *9 (N.D. Cal. July 23, 2015) (requiring the class 

notice to state the deadline for a motion for attorneys’ fees and informing class members that the 

motion and supporting materials would be available on the class website). Lastly, the Notice 

makes no mention of any objections to the Plan of Allocation. The Notice shall be amended to 

advise of the possibility of such objection or Lead Plaintiff shall explain to the Court why such 

notice is not required.

Fourth, Lead Plaintiff shall clarify that the relevant pleadings will be available on the 

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Claims Administrator’s website and, of course, shall make the pleadings so available.

Lead Plaintiff shall submit an amended stipulation and Notice and other filing that 

addresses these issues by October 15, 2015. Lead Plaintiff shall submit a red-lined version of any 

amended stipulation and proposed notice. In addition, the Stipulation provides that Defendants 

may terminate the parties’ agreement if more than a certain threshold number of Settlement Class 

Members seek exclusion from the class. The number is specified in a Supplemental Agreement. 

Lead Plaintiff shall submit the Supplemental Agreement to the Court also by October 15, 2015. 

As stated on the record in open court, Lead Plaintiff may file the Supplemental Agreement under 

seal. Upon receipt of these supplemental filings, the Court will take Lead Plaintiff’s motion for 

preliminary approval under submission.

IT IS SO ORDERED.

Dated: October 9, 2015

________________________

JACQUELINE SCOTT CORLEY

United States Magistrate Judge

Case 3:12-cv-04007-JSC Document 208 Filed 10/09/15 Page 3 of 3