KAHN GAUTHIER SWICK, LLC 

Michael A. Swick (MS-9970) 

Kim E. Miller (KM-6996) 

12 East 41st Street, 12th Floor 

New York, NY 10017 

Telephone: (212) 696-3730 

Fax: (504) 455-1498 

KAHN GAUTHIER SWICK, LLC 

Lewis S. Kahn 

650 Poydras Street, Suite 2150 

New Orleans, LA 70130 

Telephone: (504) 455-1400 

Fax: (504) 455-1498 

Counsel for the Chen Group and 

Proposed Lead Counsel for the Class 

UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF NEW YORK 

BRICKMAN INVESTMENTS, INC., 

Individually And On Behalf of All Others 

Similarly Situated, 

Plaintiff, 

 vs. 

ALLOT COMMUNICATIONS, LTD., YIGAL 

JACOBY, RAMI HADAR AND ADI SAPIR,

 

Defendants. 

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DOCKET NUMBER: 07-cv-3455 

HON. RICHARD J. HOLWELL 

(Caption continued on the following page) 

REPLY MEMORANDUM IN FURTHER SUPPPORT OF THE MOTION OF THE 

CHEN GROUP TO CONSOLIDATE RELATED ACTIONS; TO BE APPOINTED LEAD 

PLAINTIFF; AND TO APPROVE PROPOSED LEAD PLAINTIFF’S CHOICE OF 

COUNSEL 

Case 1:07-cv-03455-RJH Document 23 Filed 08/03/2007 Page 1 of 12
GERALD BILGER, Individually And On Behalf 

of All Others Similarly Situated, 

 

Plaintiff, 

 vs. 

ALLOT COMMUNICATIONS, LTD., YIGAL 

JACOBY, RAMI HADAR AND ADI SAPIR,

 

Defendants. 

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DOCKET NUMBER: 07-cv-3815 

HON. RICHARD J. HOLWELL 

ELIYAHU MOKHTAR, Individually And On 

Behalf of All Others Similarly Situated, 

Plaintiff, 

 vs. 

ALLOT COMMUNICATIONS, LTD., YIGAL 

JACOBY, RAMI HADAR AND ADI SAPIR,

 

Defendants. 

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DOCKET NUMBER: 07-cv-5456 

HON. RICHARD J. HOLWELL 

SHANNON VINSON, Individually And On 

Behalf of All Others Similarly Situated, 

 

Plaintiff, 

 vs. 

ALLOT COMMUNICATIONS, LTD., YIGAL 

JACOBY, RAMI HADAR AND ADI SAPIR,

 

Defendants. 

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DOCKET NUMBER: 07-cv-5457 

HON. RICHARD J. HOLWELL 

Case 1:07-cv-03455-RJH Document 23 Filed 08/03/2007 Page 2 of 12
INTRODUCTION 

The Chen Group respectfully submits this reply memorandum in further support of its 

motion to consolidate the related cases, to be appointed Lead Plaintiff, and to approve its choice 

of counsel, pursuant to the Private Securities Litigation Reform Act (“PSLRA”).1

Currently pending before this Court is only one other competing motion to be appointed 

Lead Plaintiff in this matter, by movant Dikla Mondial.2 For the reasons discussed below, this 

Court should deny Dikla Mondial’s motion and appoint the Chen Group Lead Plaintiff in this 

action. Dikla Mondial has failed to rebut the presumption afforded the Chen Group under the 

PSLRA that it is the most adequate plaintiff, based upon its greater loss, that otherwise satisfies 

Fed. R. Civ. P. Rule 23’s adequacy and typicality requirements. Instead, in an eleventh-hour 

attempt to cure the fatal deficiencies identified in its PSLRA Certification and motion by the 

Chen Group, Dikla Mondial has reflexively submitted declarations by its proposed Israeli lead 

counsel and the purported CEO of its “paid fund manager”, Migdal Mutual Fund Management, 

Ltd. (“Migdal”), declarations that fail to rebut the Chen Group’s serious concerns about Dikla 

Mondial’s ability to fairly and adequately represent the interests of the Class. Moreover, these 

new declarations raise unique defenses, only applicable to Dikla Mondial and not other class 

members, that prohibit this Court from appointing it as Lead Plaintiff in this litigation. 

 

1 On July 24, 2007, Dikla Mondial filed a document styled “Reply Memorandum of Law in 

Support of Motion of Dikla Mondial Mutual Fund for Consolidation of Cases, Appointment as 

Lead Plaintiff and for Approval of Lead Counsel.” This Reply contained important new 

information that should have properly been disclosed with Dikla Mondial’s original motion, 

along with new legal arguments never before raised by Dikla Mondial. Accordingly, the Chen 

Group hereby exercises its right to reply to Dikla Mondial’s filing, herein. 

2 The motion to be appointed Lead Plaintiff by movant Brickman Investments was withdrawn on 

7/25/2007.

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Dikla Mondial’s legal authority to bring this action and to move for Lead Plaintiff on 

behalf of owners of its mutual fund remains unclear. Further, the declaration submitted by 

Migdal CEO Asa Sasson has only served to obfuscate the true legal structure of Dikla Mondial 

and, for the first time, has disclosed that movant Dikla Mondial has vested in Migdal, its 

admitted “paid fund manager”, the legal authority to act on its behalf. Yet Dikla Mondial, and 

not Migdal, filed a motion to be appointed Lead Plaintiff. 

Dikla Mondial has also failed to show this Court that it will fulfill its duty to the Class 

members pursuant to the PSLRA by effectively supervising its chosen Israeli lead counsel Jacob 

Sabo. Instead of addressing the serious misrepresentations made to this Court by its proposed 

lead counsel, Dikla Mondial has glossed over its lack of oversight and has chosen instead to 

embellish other aspects of Israeli counsel’s biography. 

Finally, the new declarations submitted by Dikla Mondial raise serious jurisdictional 

questions regarding the propriety of appointing a foreign movant (who has also chosen foreign 

lead counsel for the Class) as Lead Plaintiff against a foreign defendant in this action. This 

extraterritoriality will create unique defenses that the Chen Group, comprised of American 

citizens, is not subject to, should Dikla Mondial be appointed Lead Plaintiff. Clearly, appointing 

Dikla Mondial Lead Plaintiff runs a serious risk of severely prejudicing Class members’ rights. 

The Chen Group, a proper, cohesive group under the PSLRA, has the largest financial 

interest in this litigation, is the presumptive lead plaintiff in the action, and has chosen counsel 

fully adequate and capable of effectively prosecuting this action on behalf of the Class. Dikla 

Mondial has failed to rebut with proof the presumption that the Chen Group should be appointed 

Lead Plaintiff. As such, the Chen Group respectfully requests that the Court grant its motion to 

be appointed Lead Plaintiff, and deny the motion of competing movant Dikla Mondial. 

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ARGUMENT 

I. Dikla Mondial Should Not Be Appointed Lead Plaintiff 

A. Dikla Mondial Has Not Established Its Authority To Act As Lead Plaintiff In This 

Litigation 

Dikla Mondial, a mutual fund, has no standing to bring this action. Despite a belated 

declaration by Migdal CEO Asa Sasan explaining the nature of Dikla Mondial’s relationship 

with its investment advisor Migdal, Dikla Mondial has submitted no proof that it is authorized by 

the owners of the Dikla Mondial mutual fund to bring suit to recover for investment losses. 

Moreover, Dikla Mondial can cite to no supporting caselaw that removes it from the “investment 

advisor” analysis, previously set forth in the Chen Group’s Opposition, whereby, as the movant, 

it must prove it has the attorney-in-fact authority to bring this action for its clients. 

For the proposition that Dikla Mondial, as a mutual fund and therefore an “institutional 

investor”, has the implied legal authority to file its Lead Plaintiff motion, Dikla Mondial cites 

Weiss v. Friedman, Billings, Ramsey Group, Inc., 2006 U.S. Dist. LEXIS 3028 (S.D.N.Y. Jan 25, 

2006) and Barnet v. Elan Corp., 236 F.R.D. 158, 161 (S.D.N.Y. 2005), which do not involve 

mutual funds at all; and Malasky v. IAC/InteractiveCorp, 2004 U.S. Dist. LEXIS 25832 (S.D.N.Y. 

Mar. 7, 2005), which merely cites Black’s Law Dictionary as defining “institutional investor” to 

include mutual funds. None of these cases establish that a mutual fund has automatic authority, or 

need not prove its authority, to sue for losses. 

Next, Dikla Mondial relies upon the self-serving declarations of Asa Sasson and its proposed 

Israeli lead counsel Jacob Sabo to argue that Dikla Mondial has standing to file its Lead Plaintiff 

motion. However, these declarations spotlight a fatal flaw in Dikla Mondial’s motion, where, by 

Dikla Mondial’s own admissions, it is Migdal, and not Dikla Mondial, that should have been the 

proper movant – “Migdal, its paid fund manager, is its authorized agent to purchase and sell 

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securities and to enforce rights flowing from stock ownership.” Dikla Mondial Reply, p. 5. Yet no 

evidence has been offered to even establish that Dikla Mondial, the movant, has provided its “paid 

fund manager” Migdal the authority to act on its behalf. It is not enough for Sasson, Migdal’s CEO, 

to make this assertion in a Declaration – such vesting of attorney-in-fact authority must emanate from 

the movant itself, Dikla Mondial. 

Notwithstanding that Dikla Mondial has apparently ceded its authority to its admitted “paid 

fund manager” Migdal who would effectively be the Lead Plaintiff if this Court granted Dikla 

Mondial’s Lead Plaintiff motion, Dikla Mondial’s claim that as a mutual fund it implicitly has the 

authority to pursue claims for losses is not the universal view in the courts of the United States. As 

noted in the Chen Group’s Opposition, in In re Peregrine Sys. Sec. Litig., 2002 U.S. Dist. LEXIS 

27690 at *58-*59 (S.D. Cal. October 9, 2002) the court was presented with a similar motion to be 

appointed Lead Plaintiff by the Needham Growth Fund, a mutual fund like Dikla Mondial. The court 

analyzed the fund’s standing to be appointed Lead Plaintiff, found that it did not have authority, and 

determined that “the court is unable to discern any reason why the Needham Growth Fund is able to 

function as ‘a person’ under the PSLRA and finds that it is not an appropriate Lead Plaintiff...” 

Considering that the Peregrine court denied the Needham Growth Fund’s motion upon identical 

grounds, this Court should similarly not appoint Dikla Mondial, particularly in light of its admission 

that it has ceded full control of this litigation to its “paid fund manager” Migdal. 

In short, Dikla Mondial’s attempts in its belated Reply to clarify its standing to represent the 

Class have only raised further questions, and jeopardize Class members’ rights to obtain a fair 

recovery in this action in the event that Migdal – a “paid fund manager” with no financial loss of its 

own and no similar motive to prosecute this litigation to a successful resolution like the Chen Group 

– is placed in control of this case by virtue of Dikla Mondial’s appointment as Lead Plaintiff. Dikla 

Mondial’s motion to be appointed Lead Plaintiff should therefore be denied. 

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B. Dikla Mondial Is Subject to Unique Defenses as a Foreign Plaintiff Suing a Foreign 

Company On Behalf of Allot Shareholders

United States courts must consider the question of the res judicata effect of a judgment in 

favor of Allot Communications in this class action. In re Royal Ahold N.V. Sec. and Erisa Litig., 219 

F.R.D. 343, 352 (D.Md. 2003). “Foreign courts might not recognize or enforce such a decision from 

an American court, which would allow foreign plaintiffs in the class to file suit against the defendant 

again in those foreign courts.” Id. Dikla Mondial has failed to provide any evidence regarding 

whether the foreign court of Dikla Mondial’s citizenry, Israel, may recognize a decision of this court. 

Dikla Mondial’s own willingness to submit to the jurisdiction of this court does not speak to the issue 

of a foreign court’s recognition of this Court’s decision. “A strong possibility or near certainty that a 

foreign court will not recognize a judgment in favor of the defendant as a bar to the action of its own 

citizens may be the basis for eliminating foreign purchasers from the class.” Id. (citing Bersch v. 

Drexel Firestone, Inc., 519 F.2d 974, 996 (2d. Cir. 1975)).

If Dikla Mondial is selected Lead Plaintiff, it may face problematic unique defenses. A class 

representative’s claims are not typical if that representative is subject to unique defenses. In re AOL 

Time Warner, Inc., 2006 WL 903236 (S.D.N.Y. April 6, 2006); See Gary Plastic Packaging Co. V. 

Merrill Lynch, Pierce, Fenner & Smith, Inc., 903 F.2d 176, 179-80 (2d. Cir. 1990) (class certification 

properly denied because plaintiff was inappropriate class representative as its claim was subject to 

several unique defenses), cert. denied, 489 U.S. 1025 (1991). As a foreign mutual fund in a case 

against a foreign company, the doctrines of res judicata (discussed above) and forum non conveniens

open Dikla to a range of defenses which would not apply to the class at large, but which could result 

in the dismissal of the case should Dikla be appointed Lead Plaintiff. “In particular, courts have 

refused to appoint a foreign movant to be...lead plaintiff because the defendants were subject to 

unique defenses of lacking subject matter jurisdiction and forum non conveniens.” In re Cable & 

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Wireless, PLC, Sec. Litig., 217 F.R.D. 372, 377 (E.D. Va. 2003) (citing Tri-Star Farms Ltd. V. 

Marconi, PLC, 225 F.Supp.2d 567, 573 n. 7 (W.D. Pa. 2002); In re Bann Co. Sec. Litig., 103 

F.Supp.2d 1, 10-11, 25 (D.D.C. 2000) (holding that foreign buyers of shares in a foreign company 

could not assert claims under United States securities laws.) 

Whether Defendants will succeed eventually on any of these defenses is not the issue before 

the Court. What is important is that the Class not be saddled with a representative who is subject to a 

unique defense. “Where it is predictable that a major focus of the litigation will be on an arguable 

defense unique to the named plaintiff or a small subclass, then the named plaintiff is not a proper 

class representative.” In re Liner Board Anti-trust Litigation, 203 F.R.D. 197, 211 (E.D. Penn. 2001), 

aff’d., 305 F.3d 145 (3d Cir. 2002), cert. denied, 538 U.S. 977 (2003); see State of Alaska v. 

Suburban Propane Gas Corp., 123 F.3d 1317, 1321 (9 Cir. 1997). Therefore, Dikla Mondial should 

not be appointed as Lead Plaintiff.

C. Dikla Mondial’s Failure To Investigate The Troubling Record Of Its Proposed Lead 

Counsel Sabo Renders It Inadequate To Be Appointed Lead Plaintiff 

 Dikla Mondial has failed to rebut the Chen Group’s contention that its proposed Israeli 

lead counsel Jacob Sabo has misrepresented his credentials to this Court, and has provided no 

reason why it failed to conduct a basic inquiry that could have protected the Class from counsel 

that does not possess the federal appointments it asserts. See Chen Group Opposition, pp. 11-13. 

Sabo, by declaring in his resume that he “currently serves as Co-Lead Counsel or 

supporting Lead or co-Lead counsels in numerous securities fraud actions throughout the United 

States, including, among others” the Gilat, Lumenis and Amdocs litigation (he lists no other 

current cases but these three cases), lulls one into the mistaken impression that Sabo at least 

serves in a Co-Lead position in one of these cases, “currently.” This impression is important, as 

Sabo’s representations serve to assure this Court that Sabo has the ability and experience to 

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adequately represent the Class were he to be appointed as lead counsel. Had Sabo intended to be 

truthful, he would have never described his current role in any of the previously-mentioned cases 

as one of several options including “Co-Lead Counsel” when in fact he is not “Co-Lead 

Counsel” in any of the cases listed. Further, the usage of the terms “supporting Lead or co-Lead 

Counsels” is not a common term and is misleading on a resume – it connotes no federal 

leadership appointment in a PSLRA securities fraud case, and is designed to deceive. 

The only conclusion this Court can make is that Dikla Mondial has not diligently 

managed its chosen counsel, and this Court cannot appoint Dikla Mondial Lead Plaintiff in this 

action.

II. The Chen Group is the Presumptive Lead Plaintiff 

A. The Chen Group Has the Largest Financial Interest in this Action and Is An 

Acceptable Group under the PSLRA 

The Chen Group, with losses of $42,789.64, has the “largest financial interest in the 

relief sought by the Class” among those seeking appointment as Lead Plaintiff. 15 U.S.C. § 77z1(a)(3)(B)(iii). The Chen Group has clearly demonstrated that it is the most adequate Lead 

Plaintiff to represent the Class in light of its cohesiveness, ability to work together, willingness to 

control the litigation and effectively oversee counsel, and ability to communicate and make 

decisions, with and without counsel present, about the litigation. The Chen Group members are 

fully familiar with their fiduciary obligations as class representatives under Rule 23(a)(4), and 

they have explained, in great detail, how they will proactively discharge those obligations. See 

generally Chen Group Decl. They will also act as a “single voice” in directing counsel and will 

bring their broad experiences to the forefront to protect the interests of the Class. See In re 

Oxford Health Plaints, Inc., 182 F.R.D. 42, 46 (S.D.N.Y. 1998) (recognizing the benefit of 

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Case 1:07-cv-03455-RJH Document 23 Filed 08/03/2007 Page 9 of 12
“pooling” the “knowledge and experience” of “multiple Lead Plaintiffs.”). In sum, the Chen 

Group represents precisely the type of “group of persons” – small, cohesive, cognizant, and in 

control – that Congress envisioned when it enacted the PSLRA. 

The only case cited by Dikla Mondial to rebut the Chen Group’s cohesiveness, evidenced 

by the substantive, detailed declaration signed by its members, is of no consequence. See Dikla 

Mondial Reply at 3, fn.7. In Miller v. Ventro Corp., No. C 01-01287 SBA, 2001 U.S. Dist. 

LEXIS 26027 (N.D. Cal. Nov. 28, 2001), in rejecting a group of shareholders as lead plaintiff, 

the court noted that “the Group has stated that, following the hearing before this Court, it has 

created a structure to control the litigation by which the six members of the Group will meet 

regularly and make decisions by consensus.” Id. at 31. Here, the Chen Group (comprised of only 

three members, not six), created a structure to control the litigation in anticipation of its necessity 

to further the interests of Class, not simply in response to a court’s admonition. Further, unlike in 

Miller where “the Group was essentially created by three different law firms” that came together 

to aggregate losses, the Chen Group has chosen one law firm – Kahn Gauthier Swick, LLC – as 

lead counsel to represent the class, Id. 

Accordingly, Dikla Mondial’s objections that the Chen Group lacks cohesion and is 

inadequate to serve as lead plaintiff in this litigation ring hollow. While Dikla Mondial suffers 

from a plethora of adequacy and typicality concerns that render it unable to fairly represent the 

class, in addition to numerous unique defenses, the Chen Group is the most adequate choice to 

serve as Lead Plaintiff. Further, the Chen Group has selected Kahn Gauthier Swick, LLC 

(“KGS”) to serve as Lead Counsel for the Class. KGS is highly experienced in leading the 

successful prosecution of securities class actions, and currently serves as Lead Counsel in 

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numerous securities litigations. This Court may be assured that in the event this motion is 

granted, the members of the Class will receive the highest caliber of legal representation. 

CONCLUSION 

For all the foregoing reasons, the Chen Group respectfully requests that this Court: (1) 

consolidate all related actions; (2) appoint the Chen Group as Lead Plaintiffs in the Action; (3) 

approve the Chen Group’s selection of Lead Counsel for the Class; and (4) grant such other and 

further relief as the Court may deem just and proper. 

Dated: August 3, 2007 Respectfully submitted, 

 

KAHN GAUTHIER SWICK, LLC 

/s/ Kim E. Miller_________

Kim E. Miller (KM-6996) 

Michael A. Swick (MS-9970) 

12 E. 41st Street, 12th Floor 

New York, NY 10017 

Telephone: (212) 696-3730 

Facsimile: (504) 455-1498 

KAHN GAUTHIER SWICK, LLC 

Lewis S. Kahn 

650 Poydras St., Suite 2150 

New Orleans, Louisiana 70130 

Telephone: (504) 455-1400 

Facsimile: (504) 455-1498 

Counsel for the Chen Group and 

Proposed Lead Counsel for the 

Class 

Case 1:07-cv-03455-RJH Document 23 Filed 08/03/2007 Page 11 of 12
CERTIFICATE OF SERVICE

I hereby certify that this Memorandum was filed through the ECF system and will be sent 

electronically to the registered participants as identified on the Notice of Electronic Filing (NEF), 

and paper copies will be sent to those indicated as non-registered participants on August 3, 2007. 

/s/ Kim E. Miller_____

Case 1:07-cv-03455-RJH Document 23 Filed 08/03/2007 Page 12 of 12