The cash deal follows almost three years of litigation in which the Invisalign maker already fought off most of the allegations about the impact its discount program would have on sale prices, according to documents the investors filed Thursday as part of their bid for preliminary settlement approval in the U.S. District Court for the Northern District of California.
The proposed class consists of anyone who acquired Align common stock from May 23, 2018, through Oct. 24, 2018, and lost money as a result, with exceptions for those with close ties to the company. The investors want Judge Lucy H. Koh to certify the class for settlement purposes.
The deal “represents between 3.3% and 9.1% of likely recoverable damages,” the investors said. There’s “just one allegedly false and misleading statement” left in the case after Koh dismissed the other allegations in September 2020, and there’s a “real risk” the investors wouldn’t recover anything if the case went to trial.
Lead counsel Kessler Topaz Meltzer & Check LLP plan to ask for no more than 20% of the settlement fund—$3.2 million—in attorneys’ fees, “which is below the benchmark percentage for attorneys’ fees” within the U.S. Court of Appeals for the Ninth Circuit, the settlement documents said. The firm will also seek reimbursement of up to $250,000 to cover litigation expenses.
Wilson Sonsini Goodrich & Rosati PC represents Align, which denies any wrongdoing.
The case is SEB Inv. Mgmt. AB v. Align Tech. Inc., N.D. Cal., No. 5:18-cv-06720, preliminary settlement approval motion filed 7/15/21.