USING THE LAW TO PROTECT
YOUR FUND’S ASSETS:
The Role of Institutional
Investors in U.S. Shareholder
Litigation
Prepared for:
The Tel Aviv Institutional Investor Conference
June 20, 2011
Benjamin Kaufman, Esq.
Partner
Todd Kammerman, Esq.
Partner
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© Milberg 2011
Protection of Future Income
Litigation to Prevent or Recover Institutional
Investor Losses through:
•Securities Litigation;
•Derivative Litigation; and
•Transactional Litigation
•Commercial Litigation
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“This Court has long recognized that meritorious private
actions to enforce federal antifraud securities laws are an
essential supplement to criminal prosecutions and civil
enforcement actions brought, respectively, by the
Department of Justice and the Securities and Exchange
Commission (SEC).”
-- Justice Ruth Bader Ginsburg in the opinion of the Supreme Court in Tellabs, Inc.
v. Makor Issues & Rights, Ltd., 551 U.S. 308, 313 (2007), which was litigated by
Milberg LLP
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Institutional Investors Account for
Vast Majority of Settlements
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96 total settlements valued at $2.9 billion in 2010
61% of cases settled in 2010 had institutional
investor involvement
However, the value of the cases led by an
institutional investor that settled in 2010 accounted
for 77% of the value of total 2010 settlements
Eight of the top ten settlements in 2010 (including
the year’s largest) had institutional investors as the
lead plaintiff
Sources: PricewaterhouseCoopers 2010 Securities Litigation Study (April 2011)
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Institutional Investors Role
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Private and public funds dominate the market
and have vested interest in:
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Maintaining integrity of financial markets
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Assuring corporate accountability
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Maximizing returns
Increasingly stepping forward to seek recoveries
for losses due to securities fraud
Fulfill fiduciary duties to take action when
necessary
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Serve as Lead Plaintiff and/or Class Representative
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Why Not Let Others Serve Instead?
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Your fund controls the litigation
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Your fund picks the attorneys
Your fund has direct input into any settlement
structure
You are taking proactive steps to help your
Fund and fulfilling your fiduciary duties
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Recent Jury Verdict: In re Vivendi
Universal, S.A.
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Recent trial ended with a jury verdict finding Vivendi
liable on all counts
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Retirement System for the General Employees of the
City of Miami was a lead plaintiff
Class includes foreign institutional and individual
investors who purchased their shares on U.S. exchanges
Investors estimated to recover over $1 billion
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Transactional and Derivative Litigation –
Protecting Assets From Future Losses
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Comverse Derivative Litigation
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Southwest Airlines
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Improved reporting procedures
Anheuser Busch Litigation
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$62 million in cash + significant corporate governance reforms
(settlement approved at June 21, 2010 hearing)
Settled for additional disclosures in proxy statement concerning
merger with InBev, protections for certain AB employees and an
increase in the merger consideration
Madoff Litigation
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Brought on behalf of feeder funds that invested with Madoff
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Alleges that the funds’ managers failed to conduct adequate
due diligence
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Alleges that the funds’ auditors failed to conduct proper
audits
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Attractiveness of U.S. Lawsuits
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Ability to sue on behalf of other similarly situated persons is
largely unique to the United States
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Availability of contingency fee arrangements
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Absence of “loser pays” fee-shifting rules
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Confidentiality Order
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Scheduling Orders, which move the litigation
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Right to expansive discovery after Motion to Dismiss phase
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Well-developed system for certifying class actions
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Potential for a large jury verdict
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Opting-Out of Class Actions
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Depends on the particulars of a
plaintiff’s claims and the strengths of
those claims connected to the
plaintiff’s purchases
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Typically reserved for plaintiffs with
substantial losses and financial and
structural wherewithal to pursue its own
claims
The ability of defendants to pay damages
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Opting-Out of Class Actions
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Advantages of opting-out
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The ability to select the venue in which to file
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The power to select counsel
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The ability to direct settlement unimpeded by the
court or class issues
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Possibility of obtaining a recovery many times
larger than what would have been obtained in a
class recovery
No need to seek class certification
Risks
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Opt-out plaintiff runs the risk of non-recoveryopting out forever bars that plaintiff in
participating in the class settlement or judgment
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Commercial Litigation
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Protecting your Fund against:
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Breach of Contract
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Breach of Fiduciary Duty
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Fraud

Arbitration
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The Milberg Difference
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Milberg LLP: Setting the Standard
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Expertise
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Recovered over $55 billion on behalf of shareholders
Leadership in landmark cases (e.g., Vivendi; Tellabs,
Inc. v. Makor)
Resources
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Financial and human resources to oppose defense firms
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Top-tier attorneys supported by in-house experts
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Forensic accountants and investigators
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Litigation technical support
Results
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More than 45 years of unparalleled recoveries on behalf
of investors
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Sample of Milberg’s Significant
Cases
Vivendi Universal
Securities Litigation
Xerox Securities
Litigation
Tyco International
Securities Litigation
Estimated $1 Billion
jury verdict in favor of
an international class
of defrauded investors
$750 Million
settlement in 2009
$3 Billion settlement
in 2007
Nortel Securities
Litigation
IPO Securities
Litigation
Prudential
$1.142 Billion
settlement in cash and
company stock in 2006
Lucent Technologies
Inc. Securities
Litigation
$517 Million
settlement in 2003
$586 Million cash
settlement in 2009
$4 Billion settlement
in 1997
Raytheon Co.
Securities Litigation
Sears, Roebuck and
Company
$410 Million
settlement in 2004
$215 Million cash
settlement in 2006
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Judicial Commendations of Milberg
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Following the jury verdict in Vivendi, in describing the work
of the attorneys trying the case, Judge Holwell stated:
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In Judge Barbadoro’s order approving the $3.2 billion Tyco
settlement, the court noted:
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“I can only say that this is by far the best tried case that I have had in
my time on the bench. I don’t think either side could have tried the case
better than these counsel have. The jury has spoken and that’s the end
of the trial. It was a pleasure having you in the courtroom.”
“This was an extraordinarily complex and hard-fought case. Co-Lead
Counsel put massive resources and effort into the case for five long
years, accumulating [millions of dollars in expenses] and expending
[hundreds of thousands of hours] on a wholly contingent basis. But for
Co-Lead Counsel’s enormous expenditure of time, money, and effort,
they would not have been able to negotiate an end result so favorable
for the class. . . . [L]ead Counsel’s continued, dogged effort over the
past five years is a major reason for the magnitude of the recovery.”
In Judge Thompson’s order approving the $750 million settlement
in Xerox, the court noted:
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“The class received high-quality legal representation and obtained a very
large settlement in the face of vigorous opposition by highly experienced
and skilled defense counsel.”
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Milberg LLP Practice Areas
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Institutional Investor Services
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Class Action Litigation
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Portfolio Monitoring
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Securities Fraud
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Quarterly Reporting
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Consumer Fraud
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Case Evaluation
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ERISA
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Insurance
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Antitrust
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Corporate Governance and
Shareholder Rights Advice
Litigation
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Bankruptcy
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Pro Bono Litigation
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False Claims – Qui Tam
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Mass Torts
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Human Rights and Labor
Practices
Derivative

Madoff
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Transactional
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Governance and Fees
© Milberg 2011
Thank You
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Benjamin Y. Kaufman, Esq.
E bkaufman@milberg.com
T 212.631.8641
F 212.273.4378
Admitted:
Education:
States of New York and New Jersey
B.A., Yeshiva University, 1985
J.D., Benjamin N. Cardozo School of Law of Yeshiva
University, 1988 Beklin Fellow, Belkin Scholar
M.B.A., Stern School of Business of New York University,
1999
Mr. Kaufman focuses on class actions on behalf of defrauded investors and consumers. Mr.
Kaufman’s successful securities litigations include In re Deutsche Telekom AG Securities Litig., No.
00-9475 (S.D.N.Y.), a complex international securities litigation requiring evidentiary discovery in
both the United States and Europe, which settled for $120 million. Mr. Kaufman was also part of the
team that recovered $46 million for investors in In re Asia Pulp & Paper Securities Litigation, No. 01CV-7351 (S.D.N.Y.) and $43.1 million, with contributions of $20 million, $14.85 million and $8.25
million from Motorola, the individual defendants, and defendant underwriters respectively, in
Freeland v. Iridium World Commc’ns, Ltd.
Mr. Kaufman’s outstanding representative results in derivative and transactional litigations
include: In re Trump Hotels Shareholder Derivative Litigation (Trump personally contributed some of
his holdings; the company increased the number of directors on its board, and certain future
transactions had to be reviewed by a special committee.)
He recently argued the appeal in In re Comverse Technology, Inc. Derivative Litig., 56 AD3d 49
(2008) which led to the seminal New York Appellate Division opinion which clarified the standards of
demand futility, and held that a board of directors loses the protection of the business judgment rule
where there is evidence of self-dealing and poor judgment by the directors; and In re Topps
Company, Inc. Shareholder Litig. which resulted in a 2007 decision which vindicated the rights of
shareholders under the rules of comity and doctrine of forum non conveniens and to pursue claims in
the most relevant forum notwithstanding the fact that jurisdiction might exist as well in the state of
incorporation.
Mr. Kaufman is also at the forefront of consumer litigations with a recently-filed litigation brought on
behalf of paid e-mail subscribers against web hosting and e-mail service providers in Golf Clubs Away
LLC v. Hostway Corporation, et al., Case No. 09-29596 (Fl. Cir. Ct., Broward County).
In addition, Mr. Kaufman represents many of the firm's corporate clients in complex commercial
litigation matters and arbitrations, including Puckett v. Sony Music Entertainment, No. 108802/98
(New York Cty. 2002) (a complex copyright royalty class action) and in arbitrations on behalf of
oppressed minority shareholders in both public and privately held corporations. Prior to joining
Milberg in August of 1998, Mr. Kaufman was a Court Attorney for the New York State Supreme Court,
New York County (1988-1990) and Principal Law Clerk to Justice Herman Cahn of the Commercial
Division of the New York State Supreme Court, New York County (1990-1998).
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Todd Kammerman, Esq.
E tkammerman@milberg.com Admitted:
T 646.733.5692
Education:
F 212.273.4339
States of New York and New Jersey
B.A., Brandeis University, 1999 cum laude with honors
J.D., Benjamin N. Cardozo School of Law of Yeshiva
University, 2002 Alexander Fellow
Mr. Kammerman focuses his practice on securities class action litigation, shareholder
derivative litigation and commercial litigation. Mr. Kammerman’s successful litigations
include In re CMS Energy Securities Litigation, No. 02-72004 (E.D. Mich.) ($200 million
recovery); In re Royal Dutch/Shell Transport ERISA Litigation, No. 04-1398 (D.N.J.) ($90
million recovery); Scheiner v. i2 Technologies, et al., No. 01-418 (N.D. Tex.) ($87.8 million
recovery); and In re Collins & Aikman Corporation Securities Litigation, No. 03-71173 (E.D.
Mich.) ($10.8 million recovery).
Mr. Kammerman played a pivotal role in the In re Comverse Technology, Inc. Derivative
Litigation ($62 million recovery), particularly in drafting the appellate briefs which led to the
seminal New York Appellate Division opinion, reported at 56 A.D.3d 49 (2008), clarifying the
standards of demand futility, and holding that a board of directors loses the protection of
the business judgment rule where there is evidence of self-dealing and poor judgment by
the directors. He was also a member of the team that litigated the appeal in Tellabs, Inc. v.
Makor Issues & Rights, Ltd. before the United States Supreme Court, in which the Supreme
Court issued an opinion defining the pleading standard for scienter in all federal securities
fraud cases, and is reported at 551 U.S. 308 (2007).
While at Cardozo, he was named an Alexander Fellow, through which he worked as a judicial
intern in the chambers of the Honorable Joseph A. Greenaway, Jr., U.S.D.J. in Newark, New
Jersey. Mr. Kammerman is a member of the bars of the States of New York and New Jersey
and is admitted to practice before the United States District Courts for the District of New
Jersey, Southern District of New York, Eastern District of Michigan and the Eastern District
of New York and the United States Courts of Appeals for the Third and Eleventh Circuits.
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