NEW YORK (April 19, 2016) – Labaton Sucharow LLP announced today that the Firm achieved a $41.5 million settlement, subject to court approval, in a securities class action on behalf of the Pension Trust Fund for Operating Engineers Pension Plan and the International Brotherhood of Electrical Workers (IBEW) Local No. 58/Southeastern Michigan Chapter National Electrical Contractors Association (SMC NECA) Benefit Funds in In re NII Holdings, Inc. Securities Litigation, against certain former executives of NII Holdings, Inc. (NII). NII is a telecommunications company that, through its subsidiaries, operates wireless voice and data networks in Latin America under the Nextel brand.
E. Craig Young, the administrator of the IBEW Local No. 58/SMC NECA Benefit Funds commented, “We are very pleased to have reached this result on behalf of the class. Ensuring that the best interests of our members are constantly maintained is of the utmost importance to us, and with the help of Labaton Sucharow, we can continue to uphold our mission to protect those interests from corporate misconduct.”
First to file the securities class action complaint and led by Labaton Sucharow partners Joel H. Bernstein, Mark S. Arisohn, and Serena Hallowell, Labaton Sucharow served as co-lead counsel in this case, which took place in the Eastern District of Virginia—otherwise known as the “rocket docket” for its speedy disposition of cases.
Prior to and during the class period (February 25, 2010 to February 27, 2014), NII’s wireless service featured a unique, walkie-talkie like “Push to Talk” (PTT) communication function. Among other factors, the decline of PTT in the United States and increased demand for higher speed data availability compelled NII to transition its wireless services—including its signature PTT service—from a 2 to 3G network. While NII was transitioning to the more modern 3G network, the company raised $1.45 billion in funding through the issuance of publicly traded debt securities by NII Capital. The plaintiffs allege in the complaint that within that time, NII made nearly 100 misstatements and omissions regarding allegations including those concerning defendants’ misrepresentations about NII’s instant-communication PTT function during its transition from 2G to 3G technology and NII’s efforts to attract and retain high-quality subscribers. When the truth emerged, plaintiffs alleged that shareholders suffered substantial losses caused by significant declines in the value of the company's stock and NII Capital's bonds.
NII filed for bankruptcy mid-litigation and was eventually released as a defendant, which led to a host of complex issues the Firm’s team effectively navigated. The case was further complicated in that the allegations heavily involved Latin America, which posed discovery challenges including obtaining key discovery from these countries within the compressed schedule of the rocket docket. Notwithstanding these hurdles, the parties were successfully able to negotiate an agreement in principle to settle in the amount of $41.5 million.