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Federal Securities Law Class Action Defense Cases-In re Sterling Financial: Judicial Panel On Multidistrict Litigation (MDL) Grants Plaintiff Motion To Centralize Class Action Litigation In Eastern District of Pennsylvania

Judicial Panel Grants Plaintiffs’ Request for Pretrial Coordination of Class Action Lawsuits Pursuant to 28 U.S.C. § 1407 and Rejects Defense Attorney Request to Transfer Class Actions to Southern District of New York

Seven class action lawsuits were filed against various defendants alleging violations of federal securities laws based on allegations that Sterling Financial “issued materially false and misleading statements relating to its wholly-owned subsidiary, EFI, which artificially inflated Sterling’s stock price.” In re Sterling Financial Corp. Securities Litig., ___ F.Supp.2d ___ (Jud.Pan.Mult.Lit. October 26, 2007) [Slip Opn., at 1]. Plaintiff lawyers in the Pennsylvania class action filed a motion with the Judicial Panel for Multidistrict Litigation (MDL) requesting centralization of the class actions pursuant to 28 U.S.C. § 1407 in the Eastern District of Pennsylvania; plaintiff lawyers in the other class actions supported the motion, and defense attorneys did not oppose pretrial coordination of the class action litigation but argued that the Southern District of New York was a more appropriate transferee court. Id. The Judicial Panel granted the motion to centralize the class action lawsuits and agreed with plaintiff that the Eastern District of Pennsylvania was the appropriate transferee court because “(1) defendants maintain business operations within this district; (2) the conduct at issue allegedly took place in Pennsylvania; and (3) accordingly, relevant documents and witnesses will likely be located there.” Id. Accordingly, the Panel ordered all class actions pending outside that district transferred to the Eastern District of Pennsylvania. Id., at 2.

Download PDF file of In re Sterling Financial Transfer Order