A recent Law 360 story by Emilie Ruscoe, “Robbins Geller Get $6.5M for Banc of California Settlement,” reports that a Robbins Geller Rudman & Dowd LLP team was awarded attorney fees of more than $6.5 million for its work on a securities class action accusing Banc of California and its former CEO of hiding ties to the notorious white collar fraudster Jason Galanis. In her attorney fee order, U.S. District Judge Dolly M. Gee said class counsel for the investors could have $6,517,500, or 33% of the $19,750,000 settlement in the matter. Class counsel also received about $1,575,000 to cover litigation expenses, according to Judge Gee's order.
"The court finds that the amount of fees awarded is fair, reasonable, and appropriate under the 'percentage-of-recovery' method," Judge Gee said, adding that the Robbins Geller team had "pursued the litigation and achieved the settlement with skill, perseverance, and diligent advocacy."
The lead plaintiff in the matter, Iron Workers Local No. 25 Pension Fund, also received an expense reimbursement award, which totaled $1,444. The action was launched in January 2017, when individual investor Fernando X. Garcia claimed that the bank hurt investors by concealing its connection to Galanis.
He said that when a blog post revealed the connection, the price of the bank's inflated shares plummeted. "The article alleged that Banc of California's senior-most officers and board members had ties to Galanis, who the article claims has a 'long history of secretly gaining control of banks and public companies via front men, looting assets, and leaving unsuspecting investors and taxpayers with hundreds of millions in losses,'" Garcia said.
Publication of the article caused the company's stock price to decline by $4.61 per share, or 29%, to close at $11.26 per share on Oct. 18, 2016, on unusually heavy trading volume. Three months later, when the company said its CEO was leaving and the U.S. Securities and Exchange Commission was investigating in the wake of the report, the trading price fell again by $1.50 per share, or nearly 10%, to close on Jan. 23, 2017 at $14.65.