Camille Lamar Roberts, Inc., et al. v. Rice Energy Inc., et al.

Berger Montague served as Class Counsel for purchasers of convertible debentures issued by a then-private Pennsylvania company. Plaintiffs brought claims against Rice Energy Inc. and its affiliates for common law breach of contract and unjust enrichment, along with a novel claim for violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (“UTPCPL”), which allows for treble damages, costs, and attorney’s fees.

As alleged, the Rice defendants had sought to buy out the interests of the investors who had purchased $60 million in convertible debentures in 2011. Those investors of convertible debentures had hoped this private company would someday go public so they could receive lucrative IPO stock that would far exceed their investment. Absent an IPO, investors would not seek to exercise a conversion option that would simply yield illiquid common shares in a private company but would instead choose to exercise a put option that would sell the securities back to the company for a return of capital and a 20% premium. As the company was then-private, the only source of information for those investors were the Rice defendants, who were contractually obligated to disclose “any significant and material event.” However, during the critical put period in 2013, the Rice defendants remained silent while they were surreptitiously planning to take the company public. Without the critical information about the planned IPO, which they were entitled to, almost 90% of the investors exercised the put and cashed out. Had they held and converted into public IPO shares, the investors would have achieved much larger gains on their investment.

Berger Montague waged an epic and very hard-fought battle over an eight-year period. We reviewed and analyzed over 175,000 pages of documents produced by the defendants, and thousands more from third parties. The parties conducted two dozen fact witness depositions, engaged three expert witnesses to prepare four expert reports, and litigated several discovery and other pretrial issues. After this, we successfully defeated defendants’ comprehensive motion for summary judgment, and certified in full the proposed Class after rounds of briefing. Both of those well-reasoned opinions by the Court will provide strong precedent for aggrieved investors in the future, including with regard to claims brought under Pennsylvania’s UTPCPL.

Berger Montague ultimately achieved a class settlement for $18,750,000, amounting to nearly one-third of the calculated maximum opportunity loss damages, which is over and above the return of capital and a 20% premium that investors had already received. In order to deliver the results achieved to those affected, Berger Montague diligently worked to locate and facilitate the filing of eligible claims. In the end, over 87% of all class members filed claims, which represented more than 94% of the securities eligible – something that is unprecedented in class actions.

About Berger Montague
Berger Montague is one of the nation’s preeminent law firms focusing on complex civil litigation, class actions, and mass torts in federal and state courts throughout the United States. The firm is active in the fields of antitrust, commercial litigation, consumer protection, defective products, environmental law, employment law, securities, and whistleblower cases, among other practice areas. For more than 50 years Berger Montague has played leading roles in precedent-setting cases and has recovered over $60 billion for its clients and the classes they have represented. Berger Montague is headquartered in Philadelphia and has offices in Chicago, Minneapolis, San Diego, San Francisco, Toronto, Washington, D.C., and Wilmington, Delaware, DE.