Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_06-cv-03936/USCOURTS-cand-4_06-cv-03936-10/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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{} [PROPOSED] ORDER PRELIMINARILY APPROVING SETTLEMENT AND PROVIDING FOR NOTICE –

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BRAUN LAW GROUP, P.C. KAHN GAUTHIER SWICK, LLC 

Michael D. Braun (S.B.N. 167416) Michael A. Swick 

12304 Santa Monica Blvd., Ste. 920 Kim E. Miller (S.B.N. 178370) 

Los Angeles, CA 90025 114 E. 39th St. 

Tel: (310) 442-7755 New York, NY 10016 

Fax: (310) 442-7756 Tel: (212) 920-4310 

Liaison Counsel Lead Counsel for Lead Plaintiff and Class 

KAHN GAUTHIER SWICK, LLC SAXENA WHITE P.A.

Lewis S. Kahn Maya Saxena 

650 Poydras Street, Suite 2150 Joseph E. White, III 

New Orleans, LA 70130 2424 N. Federal Highway, Suite 257 

Tel: (504) 455-1400 Boca Raton, FL 33431 

Fax: (504) 455-1498 Tel: (561) 394-3399 

Lead Counsel for Lead Plaintiff and Class Lead Counsel for Lead Plaintiff and Class

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

ADRIAN MONGELI, Individually, And On

Behalf Of All Others Similarly Situated, 

 Plaintiffs, 

 v. 

TERAYON COMMUNICATION SYSTEMS, 

INC., ZAKI RAKIB, JERRY D. CHASE, 

MARK A. RICHMAN, EDWARD LOPEZ, 

RAY FRITZ, CAROL LUSTENADER, 

MATTHEW MILLER, SHLOMO RAKIB, 

DOUG SABELLA, CHRISTOPHER 

SCHAEPE, MARK SLAVEN, LEWIS 

SOLOMON, HOWARD W. SPEAKS, 

ARTHUR T. TAYLOR, DAVID 

WOODROW, and ERNST & YOUNG, LLP, 

 Defendants. 

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CASE NO.: 3-06-CV-03936 CW

CLASS ACTION

ORDER PRELIMINARILY 

APPROVING SETTLEMENT AND 

PROVIDING FOR NOTICE

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WHEREAS, a class action is pending before the Court entitled Mongeli v. Terayon 

Communication Systems, Inc., No. 3-06-CV-03936 MJJ (the “Litigation”); 

WHEREAS, the Court has received the Stipulation of Settlement dated as of February 19, 

2008 (the “Stipulation”), that has been entered into by the Lead Plaintiff and Defendants, and the 

Court has reviewed the Stipulation and its attached Exhibits; 

WHEREAS, the parties having made application, pursuant to Federal Rule of Civil 

Procedure 23(e), for an order preliminarily approving the settlement of this Litigation, in 

accordance with the Stipulation which, together with the Exhibits annexed thereto sets forth the 

terms and conditions for a proposed settlement of the Litigation and for dismissal of the 

Litigation with prejudice upon the terms and conditions set forth therein; and the Court having 

read and considered the Stipulation and the Exhibits annexed thereto; and 

WHEREAS, all defined terms contained herein shall have the same meanings as set forth 

in the Stipulation; 

NOW, THEREFORE, IT IS HEREBY ORDERED: 

1. The Court does hereby preliminarily approve the Stipulation and the settlement 

set forth therein, subject to further consideration at the Settlement Hearing described below. 

2. A hearing (the “Settlement Hearing”) shall be held before this Court on 

September 18, 2008, at 2:00 p.m. at the United States Courthouse, 1301 Clay Street, Oakland, 

California 94612-5212 , to determine whether the proposed settlement of the Litigation on the 

terms and conditions provided for in the Stipulation is fair, reasonable and adequate to the Class 

and should be approved by the Court; whether a Judgment as provided in ¶1.14 of the Stipulation 

should be entered herein; whether the proposed Plan of Allocation should be approved; and to 

determine the amount of fees and expenses that should be awarded to Lead Counsel. The Court 

may adjourn the Settlement Hearing without further notice to Members of the Class. 

3. The Court approves, as to form and content, the Notice of Pendency and Proposed 

Settlement of Class Action (the “Notice”), the Proof of Claim and Release form (the “Proof of 

Claim”), and Summary Notice for publication annexed as Exhibits A-1, A-2 and A-3 hereto, and 

finds that the mailing and distribution of the Notice and publishing of the Summary Notice 

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substantially in the manner and form set forth in ¶¶4-5 of this Order meet the requirements of 

Federal Rule of Civil Procedure 23 and due process, and is the best notice practicable under the 

circumstances and shall constitute due and sufficient notice to all Persons entitled thereto. 

4. Pursuant to Rule 53(c) of the Federal Rules of Civil Procedure, the Court appoints 

The Garden City Group, Inc. (“Claims Administrator”) to supervise and administer the notice 

procedure as well as the processing of claims as more fully set forth below: 

(a) Not later than ten (10) days from the entry of this order (the “Notice 

Date”), Lead Counsel shall cause a copy of the Notice and the Proof of Claim, substantially in 

the forms annexed as Exhibits A-1 and A-2 hereto, to be mailed by first class mail to all Class 

Members who can be identified through the Transfer Agent of Terayon Securities and 

communication with the Nominees as discussed in paragraph 5 below.; 

(b) Also on the Notice Date, , Lead Counsel shall cause the Summary Notice 

to be published once in the print and on-line edition of the Investor’s Business Daily and issued 

electronically over a widely disseminated media wire service over the internet; and 

(c) At least fourteen (14) calendar days after the issuance of the Notice and 

publishing of the Summary Notice, Lead Counsel shall file with the Court proof, by declaration, 

of such mailing and publishing, which shall include information describing the websites such 

notice was delivered to. 

5. Nominees who purchased Terayon publicly-traded securities between June 28, 

2001 and March 1, 2006, shall send the Notice and the Proof of Claim to all beneficial owners of 

such Terayon securities within ten (10) days after receipt thereof, or send a list of the names and 

addresses of such beneficial owners to the Claims Administrator within ten (10) days of receipt 

thereof, in which event the Claims Administrator shall promptly mail the Notice and the Proof of 

Claim to such beneficial owners. Lead Counsel shall, if requested, reimburse banks, brokerage 

houses or other nominees solely for their reasonable out-of-pocket expenses incurred in 

providing notice to beneficial owners who are Class Members out of the Class Notice and 

Administration Fund, which expenses would not have been incurred except for the sending of 

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such notice, subject to further order of this Court with respect to any dispute concerning such 

compensation. 

6. All Members of the Class shall be bound by all determinations and judgments in 

the Litigation concerning the settlement, whether favorable or unfavorable to the Class. 

7. Class Members who wish to participate in the settlement shall complete and 

submit Proof of Claim forms in accordance with the instructions contained therein. Unless the 

Court orders otherwise, all Proof of Claim forms must be postmarked no later than ninety (90) 

days from the Notice Date. Any Class Member who does not timely submit a Proof of Claim 

within the time provided for shall be barred from sharing in the distribution of the proceeds of 

the Net Settlement Fund, unless otherwise ordered by the Court. 

8. Any Person who desires to request exclusion from the Class shall do so within the 

time set forth and in the manner described in the Notice. All Persons who submit valid and 

timely requests for exclusion in the manner set forth in the Notice shall have no rights under the 

Stipulation, shall not share in the distribution of the Net Settlement Fund, and shall not be bound 

by the Stipulation or the Judgment entered in the Litigation. 

9. Any Member of the Class may enter an appearance in the Litigation, at their own 

expense, individually or through counsel of their own choice. If they do not enter an appearance, 

they will be represented by Lead Counsel. 

10. Any Member of the Class may appear and show cause, if he, she or it has any 

reason, why the proposed settlement of the Litigation should or should not be approved as fair, 

reasonable and adequate, why a judgment should or should not be entered thereon, why the Plan 

of Allocation should or should not be approved, or why attorneys’ fees and expenses should or 

should not be awarded to Lead Counsel; provided, however, that no Class Member or any other 

Person shall be heard or entitled to contest the approval of the terms and conditions of the 

proposed settlement, or, if approved, the Judgment to be entered thereon approving the same, or 

the order approving the Plan of Allocation, or the attorneys’ fees and expenses to be awarded to 

Lead Counsel, unless that Person has delivered by first class mail written objections and copies 

of any papers and briefs such that they are received on or before August 28, 2008, by: Saxena 

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White, P.A., c/o Joseph E. White III, 2424 North Federal Highway, Suite 257, Boca Raton, FL 

33431, Kahn Gauthier Swick, c/o Lewis S. Kahn, 650 Poydras St., Suite 2150, New Orleans, LA 

70130, Morgan, Lewis & Bockius LLP, c/o John Hemann One Market Spear Street Tower, San 

Francisco, CA 94105, and Latham & Watkins LLP, c/o Patrick E. Gibbs, 140 Scott Drive, Menlo 

Park, CA 94025, and filed these objections, papers and briefs with the Clerk of the United States 

District Court for the Northern District of California, on or before August 28, 2008. Any 

Member of the Class who does not make his, her or its objection in the manner provided shall be 

deemed to have waived such objection and shall forever be foreclosed from making any 

objection to the fairness or adequacy of the proposed settlement as set forth in the Stipulation, to 

the Plan of Allocation, or to the award of attorneys’ fees and expenses to Lead Counsel, unless 

otherwise ordered by the Court. 

11. All funds held by the Escrow Agent shall be deemed and considered to be in the 

custody of the Court, and shall remain subject to the jurisdiction of the Court, until such time as 

such funds shall be distributed pursuant to the Stipulation and/or further order(s) of the Court. 

12. All papers in support of the settlement, the Plan of Allocation, and the application 

by Lead Counsel for attorneys’ fees or reimbursement of expenses shall be filed and served 

fourteen (14) calendar days before the Settlement Hearing. 

13. Neither the Defendants nor their Related Parties shall have any responsibility for 

or liability with respect to the Plan of Allocation or any application for attorneys’ fees or 

reimbursement of expenses submitted by Lead Counsel, and such matters will be considered 

separately from the fairness, reasonableness and adequacy of the settlement. 

14. At or after the Settlement Hearing, the Court shall determine whether the Plan of 

Allocation proposed by Lead Counsel, and any application for attorneys’ fees or reimbursement 

of expenses shall be approved. 

15. All reasonable expenses incurred in identifying and notifying Class Members, as 

well as administering the Settlement Fund, shall be paid as set forth in the Stipulation. In the 

event the settlement is not approved by the Court, or otherwise fails to become effective, neither 

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the Lead Plaintiff nor Lead Counsel shall have any obligation to repay any amounts actually and 

properly disbursed from the Class Notice and Administration Fund. 

16. Neither the Stipulation, nor any of its terms or provisions, nor any of the 

negotiations or proceedings connected with it, shall be construed as an admission or concession 

by Defendants or their Related Parties of the truth of any of the allegations in the Litigation, or of 

any liability, fault, or wrongdoing of any kind and shall not be construed as, or deemed to be 

evidence of or an admission or concession that Lead Plaintiff or any Class Members have 

suffered any damages, harm, or loss. 

17. In the event that the settlement does not become effective in accordance with the 

terms of the Stipulation or the Effective Date does not occur, or in the event that the Settlement 

Fund, or any portion thereof, is returned to the Defendants, then this Order shall be rendered null 

and void to the extent provided by and in accordance with the Stipulation and shall be vacated 

and, in such event, all orders entered and releases delivered in connection herewith shall be null 

and void to the extent provided by and in accordance with the Stipulation. 

18. The Court reserves the right to continue the Settlement Hearing without further 

notice to the Members of the Class, and retains jurisdiction to consider all further applications 

arising out of or connected with the proposed settlement. Should the Court continue the 

Settlement Hearing, such a continuance will be reflected in the Court’s calendar and accessible 

via the Court’s website. Also, Lead Counsel shall publish over the same widely disseminating 

news wire as used to publish the Summary Notice, a press release informing Class Members of 

the change. The Court may approve the settlement, with such modifications as may be agreed to 

by the Settling Parties, if appropriate, without further notice to the Class. 

DATED: 4/14/08 

 THE HONORABLE CLAUDIA WILKEN 

UNITED STATES DISTRICT JUDGE 

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Respectfully submitted, 

Dated: ____________________

SAXENA WHITE P.A. 

MAYA SAXENA 

JOSEPH E. WHITE III 

JOSEPH E. WHITE, III 

2424 North Federal Highway, Suite 257

Boca Raton, FL 33431 

Tel: (561) 394-3399 

Fax: (561) 394-3382 

Counsel for Lead Plaintiff and the Class 

Dated: ____________________ 

Dated: ____________________ 

KAHN GAUTHIER SWICK, LLC

LEWIS S. KAHN 

________________________________________________

LEWIS S. KAHN 

650 Poydras St, Suite 2150 

New Orleans, LA 70130 

Tel: 504/455-1400 

Fax: 504/455-1498 

Counsel for Plaintiff and the Class 

BRAUN LAW GROUP, P.C. 

MICHAEL D. BRAUN 

MICHAEL D. BRAUN 

12400 Wilshire Blvd., Suite 920 

Los Angeles, CA 90025 

Tel: 310/442-7755 

Fax: 310/442-7756 

Liaison Counsel for Plaintiff and the Class

Dated: ____________________ 

LATHAM & WATKINS LLP 

PATRICK E. GIBBS 

JENNIE FOOTE FELDMAN 

PATRICK E. GIBBS 

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140 Scott Drive

Menlo Park, CA 94025 

Tel: 650/328-4600 

Fax: 650/463-2600

Counsel for Defendants 

Dated: ____________________ 

MORGAN, LEWIS & BOCKIUS LLP

MICHAEL J. LAWSON 

SHEILA A. JAMBEKAR 

JOHN HEMANN 

One Market 

Spear Street Tower 

San Francisco, CA 94105 

Tel: 415/442-1000 

Fax: 415/442-1001

Counsel for Defendant Ernst & Young LLP

Filer’s Attestation: Pursuant to General Order No. 45, Section X(B), Michael Braun hereby 

attests that concurrence in the filing of this document has been obtained. 

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