Robert J. Matthews v. FAT Brands Inc. et al, No. 2:2022cv01820 - Document 71 (C.D. Cal. 2023)
Court Description: ORDER AND FINAL JUDGMENT - CLASS ACTION 70 by Judge Mark C. Scarsi: The Court hereby finally certifies this action as a class action for purposes of the Settlement, pursuant to Rule 23(a) and (b)(3) of the Federal Rules of Civil Procedure, on beh alf of all Persons who purchased publicly traded FAT Brands, Inc. ("FAT Brands") securities during the period from December 4, 2017 through February 18, 2022. The Action and all claims contained therein, as well as all of the Released Cl aims, are dismissed with prejudice as against each and all of the Defendants. The Parties are to bear their own costs, except as otherwise provided in the Settlement Stipulation. The Court hereby finds that the proposed Plan of Allocation is a fair a nd reasonable method to allocate the Net Settlement Fund among Settlement Class Members, and Class Counsel and the Claims Administrator are directed to administer the Plan of Allocation in accordance with its terms and the terms of the Stipulation. C lass Counsel are hereby awarded 25% of the Settlement Amount, or $625,000.00 in cash and $125,000.00 worth of FAT Brands Class A common stock, in fees, which the Court finds to be fair and reasonable, and $45,000.00 in reimbursement of out-of-pocket expenses. Class Representatives are hereby awarded $1,500.00 each. (SEE DOCUMENT FOR OTHER SPECIFICS). (MD JS-6, Case Terminated). (lc)
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Robert J. Matthews v. FAT Brands Inc. et al Doc. 71 1 JS-6 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA 9 10 Case Nos. 2:22-cv-01820-MCS-RAO 2:22-cv-02541-MCS-RAO 11 IN RE: 12 FAT BRANDS INC. SECURITIES LITIGATION 13 14 Hon. Mark C. Scarsi CLASS ACTION 15 16 17 18 19 20 ORDER AND FINAL JUDGMENT 21 22 23 24 25 26 27 28 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO Dockets.Justia.com 1 On the 28th day of February, 2023, a hearing having been held before this 2 Court to determine: (1) whether the terms and conditions of the Stipulation of 3 Settlement dated September 23, 2022 (“Stipulation”) are fair, reasonable and 4 adequate for the settlement of all claims asserted by the Settlement Class against 5 Defendants (as defined in the Stipulation), including the release of the Released 6 Claims against the Released Parties, and should be approved; (2) whether judgment 7 should be entered dismissing this Action with prejudice; (3) whether to approve the 8 proposed Plan of Allocation as a fair and reasonable method to allocate the Net 9 Settlement Fund among Settlement Class Members; (4) whether and in what 10 amount to award Lead Counsel as fees and reimbursement of expenses; and (5) 11 whether and in what amount to approve an award to the Plaintiffs; and 12 13 The Court having considered all matters submitted to it at the hearing and otherwise; and 14 It appearing in the record that the Notice substantially in the form approved 15 by the Court in the Court’s Order Re: Motion for Preliminary Approval of Class 16 Action Settlement, dated November 8, 2022 (“Preliminary Approval Order”) was 17 disseminated to all reasonably identifiable Settlement Class Members and posted to 18 the website of the Claims Administrator, both in accordance with the Preliminary 19 Approval Order and the specifications of the Court; and 20 21 22 23 24 NOW, THEREFORE, IT IS HEREBY ORDERED, ADJUDGED AND DECREED THAT: 1. All capitalized terms used herein have the same meanings as set forth and defined in the Stipulation. 2. For purposes of this Settlement, the Court has jurisdiction over the 25 subject matter of the Action, Plaintiffs, all Settlement Class Members, and 26 Defendants. 27 28 1 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 3. The Court finds that the prerequisites for a class action under Rule 2 23(a) and (b)(3) of the Federal Rules of Civil Procedure have been satisfied in that: 3 (a) the number of Settlement Class Members is so numerous that joinder of all 4 members thereof is impracticable; (b) there are questions of law and fact common 5 to the Settlement Class; (c) Plaintiffs’ claims are typical of the claims of the 6 Settlement Class they seek to represent; (d) Plaintiffs fairly and adequately 7 represent the interests of the Settlement Class; (e) questions of law and fact common 8 to the members of the Settlement Class predominate over any questions affecting 9 only individual members of the Settlement Class; and (f) a class action is superior 10 to other available methods for the fair and efficient adjudication of this Action. The 11 Settlement Class is being certified for settlement purposes only. 12 4. The Court hereby finally certifies this action as a class action for 13 purposes of the Settlement, pursuant to Rule 23(a) and (b)(3) of the Federal Rules 14 of Civil Procedure, on behalf of all Persons who purchased publicly traded FAT 15 Brands, Inc. (“FAT Brands”) securities during the period from December 4, 2017 16 through February 18, 2022, both dates inclusive (“Settlement Class Period”), except 17 that excluded from the Settlement Class are: (a) persons who suffered no 18 compensable losses; and (b) Defendants; the officers, directors, and affiliates of 19 FAT Brands at all relevant times; FAT Brands’ employee retirement or benefit 20 plan(s) and their participants or beneficiaries to the extent they purchased or 21 acquired FAT Brands securities through any such plan(s); immediate family 22 members, legal representatives, heirs, successors or assigns of any excluded person 23 or entity; and any entity affiliated with any excluded person or in which any 24 excluded person or entity has a controlling interest. Also excluded from the 25 Settlement Class are Persons who filed valid and timely requests for exclusion from 26 the Settlement Class in accordance with this Preliminary Approval Order, as listed 27 on Schedule A to this Final Judgment. Pursuant to Rule 23 of the Federal Rules of 28 2 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 Civil Procedure, Plaintiffs are certified as the class representatives on behalf of the 2 Settlement Class (“Class Representatives”) and Lead Counsel previously selected 3 by Lead Plaintiff and appointed by the Court are hereby appointed as Class Counsel 4 for the Settlement Class (“Class Counsel”). 5 5. In accordance with the Court’s Preliminary Approval Order, the Court 6 hereby finds that the forms and methods of notifying the Settlement Class of the 7 Settlement and its terms and conditions met the requirements of due process, Rule 8 23 of the Federal Rules of Civil Procedure, and Section 21D(a)(7) of the Exchange 9 Act, 15 U.S.C. § 78u-4(a)(7), as amended by the Private Securities Litigation 10 Reform Act of 1995; constituted the best notice practicable under the 11 circumstances; and constituted due and sufficient notice of these proceedings and 12 the matters set forth herein, including the Settlement and Plan of Allocation, to all 13 persons and entities entitled to such notice. No Settlement Class Member is relieved 14 from the terms and conditions of the Settlement, including the releases provided for 15 in the Stipulation, based upon the contention or proof that such Settlement Class 16 Member failed to receive actual or adequate notice. A full opportunity has been 17 offered to the Settlement Class Members to object to the proposed Settlement and 18 to participate in the hearing thereon. Thus, it is hereby determined that all 19 Settlement Class Members are bound by this Final Judgment except those persons 20 listed on Schedule A to this Final Judgment. 21 6. The Settlement is approved as fair, reasonable and adequate, and in the 22 best interests of the Settlement Class. This Court further finds that the Settlement 23 set forth in the Stipulation is the result of good faith, arm’s-length negotiations 24 between experienced counsel representing the interests of Class Representatives, 25 Settlement Class Members, and Defendants. The Parties are directed to 26 consummate the Settlement in accordance with the terms and provisions of the 27 Stipulation. 28 3 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 7. The Action and all claims contained therein, as well as all of the 2 Released Claims, are dismissed with prejudice as against each and all of the 3 Defendants. The Parties are to bear their own costs, except as otherwise provided 4 in the Settlement Stipulation. 5 8. Upon the Effective Date, the Releasing Parties, on behalf of 6 themselves, their successors and assigns, and any other Person claiming (now or in 7 the future) through or on behalf of them, regardless of whether any such Releasing 8 Party ever seeks or obtains by any means, including without limitation by 9 submitting a Proof of Claim, any disbursement from the Settlement Fund, shall be 10 deemed to have, and by operation of this Final Judgment shall have, fully, finally, 11 and forever compromised, settled, resolved, released, relinquished, waived, 12 dismissed and discharged all Released Claims against the Released Parties and shall 13 have covenanted not to sue the Released Parties with respect to any and all Released 14 Claims, and shall be permanently barred and enjoined from asserting, commencing, 15 prosecuting, instituting, assisting, instigating, or in any way participating in the 16 commencement or prosecution of any action or other proceeding, in any forum, 17 asserting any Released Claim, in any capacity, against any of the Released Parties. 18 For the avoidance of doubt, Defendants are released from any and all claims for 19 contribution or indemnity, as would otherwise be allowed by Section 21D of the 20 Exchange Act, 15 U.S.C. §78u-4(f)(7). Nothing contained herein shall, however, 21 bar the Releasing Parties from bringing any action or claim to enforce the terms of 22 the Stipulation or this Final Judgment. Nor shall anything contained herein limit or 23 release any claims Defendants may have with regard to insurance coverage that may 24 be available to them under any applicable policy. This release shall not apply to any 25 Settlement Class Members who timely and properly exclude themselves from the 26 Settlement Class. 27 28 4 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 9. With respect to any and all Released Claims, the Releasing Parties 2 shall waive, shall be deemed to have waived, and by operation of this Final 3 Judgment shall have waived, the provisions, rights, and benefits of California Civil 4 Code § 1542, which provides: 5 A general release does not extend to claims that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party. 6 7 8 9 10 10. With respect to any and all Released Claims, the Releasing Parties 11 shall waive, shall be deemed to have waived, and by operation of this Final 12 Judgment shall have waived, any and all provisions, rights and benefits conferred 13 by any law of any state, territory, foreign country or principle of common law, 14 which is similar, comparable or equivalent to California Civil Code § 1542. The 15 Releasing Parties may hereafter discover facts in addition to or different from those 16 which they now knows or believes to be true with respect to the Released Claims, 17 but the Releasing Parties, upon the Effective Date, shall be deemed to have, and by 18 operation of this Final Judgment shall have, fully, finally and forever settled and 19 released, any and all Released Claims, known or unknown, suspected or 20 unsuspected, contingent or non-contingent, whether or not concealed or hidden, 21 which now exist, or heretofore have existed, upon any theory of law or equity now 22 existing or coming into existence in the future, including, but not limited to, conduct 23 which is negligent, intentional, with or without malice, or a breach of fiduciary duty, 24 law or rule, without regard to the subsequent discovery or existence of such 25 different or additional facts. The Releasing Parties acknowledge and the Settlement 26 Class Members shall be deemed by operation of this Final Judgment to have 27 28 5 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 acknowledged, that the foregoing waiver was separately bargained for and a key 2 element of the Settlement. 3 11. Upon the Effective Date, the Released Parties shall be deemed to have, 4 and by operation of the Final Judgment shall have, fully, finally, and forever 5 released, relinquished, and discharged all claims they may have against the 6 Releasing Parties related to the Releasing Parties’ prosecution of the Action or any 7 other known or unknown counter-claim related thereto and shall have covenanted 8 not to sue the Releasing Parties with respect to any counter claim, claim, or sanction 9 related to the Released Claims, and shall be permanently barred and enjoined from 10 asserting, commencing, prosecuting, instituting, assisting, instigating, or in any way 11 participating in the commencement or prosecution of any action or other 12 proceeding, in any forum, asserting any such claim, in any capacity, against any of 13 the Releasing Parties. Nothing contained herein shall, however, bar the Released 14 Parties from bringing any action or claim to enforce the terms of this Stipulation or 15 the Final Judgment. 16 12. The Court finds that all Parties and their counsel have complied with 17 all requirements of Rule 11 of the Federal Rules of Civil Procedure and the Private 18 Securities Litigation Record Act of 1995 as to all proceedings herein. 19 13. Neither this Final Judgment, the Stipulation (nor the Settlement 20 contained therein), nor any of its terms and provisions, nor any of the negotiations, 21 documents or proceedings connected with them is evidence, or an admission or 22 concession by any Party or their counsel, any Settlement Class Member, or any of 23 the Released Parties, of any fault, liability or wrongdoing whatsoever, as to any 24 facts or claims alleged or asserted in the Action or could have been alleged or 25 asserted, or any other actions or proceedings, or as to the validity or merit of any of 26 the claims or defenses alleged or asserted or could have been alleged or asserted in 27 any such action or proceeding. This Final Judgment is not a finding or evidence of 28 6 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 the validity or invalidity of any claims or defenses in the Action, any wrongdoing 2 by any Party, Settlement Class Member, or any of the Released Parties, or any 3 damages or injury to any Party, Settlement Class Member, or any Released Parties. 4 Neither this Final Judgment, the Stipulation (nor the Settlement contained therein), 5 nor any of its terms and provisions, nor any of the negotiations, documents or 6 proceedings connected with therewith (a) shall (i) be argued to be, used or construed 7 as, offered or received in evidence as, or otherwise constitute an admission, 8 concession, presumption, proof, evidence, or a finding of any, liability, fault, 9 wrongdoing, injury or damages, or of any wrongful conduct, acts or omissions on 10 the part of any Released Party, or of any infirmity of any defense, or of any damages 11 to Class Representatives or any other Settlement Class Member, or (ii) otherwise 12 be used to create or give rise to any inference or presumption against any of the 13 Released Parties concerning any fact or any purported liability, fault, or wrongdoing 14 of the Released Parties or any injury or damages to any person or entity, or (b) shall 15 otherwise be admissible, referred to or used in any proceeding of any nature, for 16 any purpose whatsoever; provided, however, that this Final Judgment, the 17 Stipulation, or the documents related thereto may be introduced in any proceeding, 18 whether in the Court or otherwise, as may be necessary to enforce the Settlement or 19 Final Judgment, to effectuate the liability protection granted them hereunder, to 20 support a defense or counterclaim based on principles of res judicata, collateral 21 estoppel, release, good faith settlement, judgment bar or reduction, offset or any 22 other theory of claim preclusion or issue preclusion or similar defense or 23 counterclaim or as otherwise required by law. 24 14. Except as otherwise provided herein or in the Stipulation, all funds and 25 Settlement Shares held by the Escrow Agent shall be deemed to be in custodia legis 26 and shall remain subject to the jurisdiction of the Court until such time as the funds 27 28 7 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO 1 are distributed or returned pursuant to the Stipulation and/or further order of the 2 Court. 3 15. Exclusive jurisdiction is hereby retained over the Parties and the 4 Settlement Class Members for all matters relating to the Action, including the 5 administration, interpretation, effectuation or enforcement of the Stipulation and 6 this Final Judgment, and including any application for fees and expenses incurred 7 in connection with administering and distributing the Settlement Fund to the 8 Settlement Class Members. 9 16. Without further order of the Court, Defendants and Class 10 Representatives may agree to reasonable extensions of time to carry out any of the 11 provisions of the Stipulation. 12 17. There is no just reason for delay in the entry of this Final Judgment 13 and immediate entry by the Clerk of the Court is expressly directed pursuant to Rule 14 54(b) of the Federal Rules of Civil Procedure. 15 18. The finality of this Final Judgment shall not be affected, in any 16 manner, by rulings that the Court makes herein on the proposed Plan of Allocation 17 or Class Counsel’s application for an award of attorneys’ fees and expenses or an 18 award to Class Representatives. 19 19. The Court hereby finds that the proposed Plan of Allocation is a fair 20 and reasonable method to allocate the Net Settlement Fund among Settlement Class 21 Members, and Class Counsel and the Claims Administrator are directed to 22 administer the Plan of Allocation in accordance with its terms and the terms of the 23 Stipulation. 24 20. Class Counsel are hereby awarded 25% of the Settlement Amount, or 25 $625,000.00 in cash and $125,000.00 worth of FAT Brands Class A common stock, 26 in fees, which the Court finds to be fair and reasonable, and $45,000.00 in 27 reimbursement of out-of-pocket expenses. Class Representatives are hereby 28 8 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO Schedule A 1 2 1. Raymond C. Maratea 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 10 ORDER AND FINAL JUDGMENT Nos. 2:22-cv-01820-MCS-RAO and 2:22-cv-02541-MCS-RAO
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