On February 14, 2022, U.S. District Judge Alison J. Nathan granted final approval of a proposed $18 million Settlement (the “Settlement”) in a class action against AMC Entertainment Holdings, Inc. and certain executives and financial underwriters (“AMC,” the “Company,” or “Defendants”). The Settlement resolves allegations that AMC misled investors when touting the Company’s plans to acquire Carmike Cinemas, Inc. (“Carmike”), Odeon & UCI Cinema Group, and Nordic Cinema Group AB. The settlement amount covers monetary relief to the class members, awards to the lead plaintiffs, and attorneys’ fees and expenses.
This lawsuit was vigorously litigated for over three years. After Plaintiffs initiated the action on behalf of shareholders, AMC filed a motion to dismiss the complaint, arguing that Plaintiffs failed to adequately allege that any material misstatements or omissions occurred and, even if such omissions did occur, that AMC lacked actionable knowledge at the time of omission. Ultimately, the Court sustained Plaintiffs’ allegations regarding Carmike’s under-investment in its theaters and Securities Act claims based on the conversion of loyalty program members and seasonality of European business.
Following the Court’s decision on Defendants’ motion to dismiss, the parties engaged in a comprehensive discovery process, including voluminous document review and numerous depositions of witnesses. In addition, Plaintiffs moved the Court for certification of the proposed class, which the Court granted on March 30, 2021. The parties were preparing for summary judgment and trial when they agreed to settle the case.
The Court preliminarily approved the settlement on November 8, 2021, finding that the Settlement: (1) resulted from informed, extensive arm’s-length and non-collusive negotiations; (2) eliminates the risks of continued litigation; (3) does not give unduly preferential treatment to Plaintiffs or to segments of the class; (4) does not provide excessive compensation to counsel; (5) has no obvious deficiencies; and (6) falls within a range of reasonableness warranting eventual final approval.
At a final approval hearing held on February 10, 2022, the Court affirmed the reasonableness of the Settlement, attorneys’ fees of one-third of the Settlement plus an estimated $1.3 million in litigation expenses, and lead plaintiff awards of $25,842.79.
The deadline for filing a proof of claim form in this action is February 28, 2022. The form and related case materials can be accessed here.
Plaintiffs are represented by Miller Shah LLP and Robbins Geller Rudman & Dowd LLP. The case caption in this matter is Hawaii Structural Ironworkers Pension Trust Fund v. AMC Entertainment Holdings Inc. et al., Case No. 1:18-cv-00299, filed in the United States District Court for the Southern District of New York.
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