PHILADELPHIA – On May 29, the U.S. District Court for the Eastern District of Pennsylvania selected a group of individuals and two law firms to lead a securities class action on behalf of investors against Trevena Inc.
The lawsuit stems from claims that the clinical stage biopharmaceutical company violated sections of the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Plaintiffs Albert Koch, Whittier Pierce, Christopher Beyers, Kevin Walsh and Peter Palmer, known as the Trevana Group in the ruling; Huseyin Erenoglu; and Lanphie Ping all sought to become the lead plaintiff.
Judge Cynthia M. Rufe selected the Trevena Group as lead plaintiffs. Block & Leviton LLP was also selected as lead counsel while Kaufman Coren & Ress P.C. will serve as liaison counsel. The court determined these plaintiffs and firms were the best fit for the case.
Rufe
The plaintiffs are people who invested in Trevena after it released a statement in 2016 that the Food and Drug Administration reached an agreement with it regarding key elements of its Olinvo product, causing stock prices to increase. The FDA later rejected recommendation of the drug in 2018, causing stocks to drop 64 percent when the market closes on Oct. 9, 2018.
In making its decision, Rufe first evaluated who had the largest financial loss. This consists of who bought the most shares, the net funds the plaintiffs used and the actual losses they experienced. Erenoglu alleged he lost $552,075.43 while the Trevena Group individuals alleged they lost $485,972.97. Ping alleged a loss of $205,654.53.
Unlike the other moving plaintiffs, the Trevena Group also pointed out in its joint declaration that its members had several phone calls to discuss the role of the lead plaintiff and who would fill it.
“Having reviewed the submissions from Trevena Group as to its selection of Block & Leviton LLP as its choice of lead counsel and Kaufman Coren & Ress, P.C. as liaison counsel, the court finds that there is no basis to interfere with the strong presumption in favor of approving counsel,” Rufe wrote.
The judge added that each firm has lots of experience when it comes to arguing in class action lawsuits, especially as it relates to securities litigation.
Regarding Erenoglu’s sworn statements, Rufe noted there were errors the plaintiffs and the court noticed that “amount to a substantial degree of carelessness and raise doubt as to whether he will fairly and adequately represent the best interests of the class.”