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In re Computer Associates Class Action Securities Litigation

September 12, 2007

IN RE COMPUTER ASSOCIATES CLASS ACTION SECURITIES LITIGATION
IN RE COMPUTER ASSOCIATES 2002 CLASS ACTION SECURITIES LITIGATION
FEDERMAN
v.
ARTZT ET AL.



The opinion of the court was delivered by: Platt, District Judge.

MEMORANDUM AND ORDER

Before the Court is Respondent CA Special Litigation Committee's motion to clarify or amend this Court's Order dated August 2, 2007, pursuant to which this Court reiterated its ruling on August 1, 2007 denying on the record the pending 60(b) and related discovery motions filed by derivative plaintiff Ranger Governance, Ltd.*fn1 and class action plaintiffs, Wyly Movants.

Federal Rule of Civil Procedure 60(b) provides in part:

Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud, Etc.

On motion and upon such terms as are just, the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence which by due diligence could not have been discovered in time to move for a new trial under Rule 59(b); (3) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party . . . . The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order, or proceeding was entered or taken.

(Emphasis added)

As above set forth, Rule 60(b) requires that motions be made under that Rule within one year, i.e., on or before December 10, 2004 in this case.

Respondent CA Special Litigation Committee (CA CLS), however, was not appointed by the Computer Associates International, Inc. Board of Directors to represent or investigate CA's claims until February 1, 2005. Indeed, CA SLC did not appear in these actions by its attorneys, Fried, Frank, Harris, Shriver & Jacobson, LLP, until March 14, 2005, approximately fifteen months after the above captioned matters were settled on December 10, 2003.

Given that CA SLC was not in existence on December 10, 2004, it was in no position on that day to file a 60(b) motion within the statutory time frame. Moreover and due to the fact that the Committee had not yet been appointed, it does not today have standing to bring or participate in a Rule 60(b) motion.

Consequently, this Court did not intend and, moreover, has no authority, to include the CA SLC in its Order dated August 2, 2007.

As heretofore indicated, on December 5, 2003, a settlement hearing was held whereby settlements in the following actions were negotiated: In re Computer Associates Securities Litigation, 98-CV-4893; In re Computer Associates 2002 Class Action Securities Litigation, 02-CV-1226; and Federman v. Artzt, 03-CV-4199, a derivative action.*fn2 Upon its finding that said Settlement was fair, reasonable and adequate and in the best interests of CA and its shareholders, this Court issued an Order of Final Judgment and Dismissal dated December 8, 2003. Said Order was entered in the office of the Clerk on December 10, 2003.

On December 7, 2004, the class action plaintiffs, Wyly Movants, moved this Court to vacate the aforesaid Settlement and Order of Final Judgment and Dismissal dated December 8, 2003 pursuant to Federal Rule of Civil Procedure 60(b). Similarly, Derivative Plaintiffs filed a Notice of Motion on December 9, 2004 pursuant to Rule 60(b) seeking relief from the aforesaid Order of Final Judgment and Dismissal which approved the Settlement.*fn3

On December 13, 2004, this Court instructed those parties to brief the 60(b) motion. See Minute Order dated December 13, 2004, DK # 98-CV-4839, Entry # 228. By letter to the Court dated December 16, 2004, the Wyly Movants sought expedited discovery in support of their motion. Counsel for CA, John Hardiman, Esq., of the firm Sullivan & Cromwell, LLP, however, objected to the Wyly Movants' discovery requests and on February 3, 2005, this Court referred the discovery issues to Magistrate Judge E. Thomas Boyle. On February 8, 2005, Magistrate Judge Boyle granted CA's motion to stay discovery in the derivative action.*fn4 See Order dated February 8, 2005, DK # 04-CV-2697, Entry # 72.

Thereafter and on June 14, 2005, more than six months after its application to open the Settlement was denied without prejudice, the Wyly Movants submitted their fully briefed 60(b) motion while Ranger Governance, Ltd. submitted its fully briefed 60(b) motion on June16, 2005. Both the Wyly Movants and Ranger Governance, Ltd. claimed that settlement of the class action and derivative lawsuits were procured by fraud, misrepresentation and other misconduct and that newly discovered evidence warranted relief from the Order of Final Judgment and Dismissal dated December 8, 2003. Both parties further claimed that CA's General Counsel, Steven Woghin, Esq., failed to disclose to the Court and opposing counsel the existence of ...


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