Eighth Circuit Rejects Suit by Class Representative against Class Counsel

BNA is reporting on Koehler v. Brody, 8th Cir., Nos. 06-2357, 06-2746, 3/27/07, in which it rejected a suit by a class representative against the class counsel. Here is an excerpt from the story:

A class representative dissatisfied with a settlement of securities litigation stemming from a bank merger failed to show that the Private Securities Litigation Reform Act provided a cause of action for his claims against class counsel, the U.S. Court of Appeals for the Eighth Circuit ruled March 27.

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Plaintiff J. Michael Koehler was a lead plaintiff and class representative in those cases. Koehler and others objected to a proposed settlement of $490 million in cash. However, the district court approved the settlement as fair and reasonable and the appeals court affirmed the judgment approving the settlement.

Koehler subsequently filed this action against the attorneys who represented his class and against several attorneys who represented two of the other lead plaintiffs, the court explained. He alleged that the attorneys breached their fiduciary duties, violated PSLRA, and engaged in civil conspiracy by settling the class actions without his approval and by misleading the court into approving the settlement, the court said. The district court granted the defendants' motions to dismiss the complaint.

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